SOUTH AFRICAN FAST FOOD/QSR INDUSTRY LANDSCAPE REPORT COMPILED: JULY 2019 COMPANY OVERVIEW Insight Survey is a South African B2B market research company with more than 10 years experience, focusing on business-to-business (B2B) and industry research to ensure smarter, more-profitable business decisions are made with reduced investment risk. We offer B2B market research solutions to help you to successfully improve or expand your business, enter new markets, launch new products or better understand your internal or external environment. At Insight Survey, we believe in the advantage market research gives business leaders to fully understand their industry, facilitate business strategy, improve company performance, and drive company growth. 2 INDUSTRY AND COMPETITIVE INTELLIGENCE OVERVIEW WHY? SOLUTIONS ▪ Our bespoke Competitive Business Intelligence Research ▪ Competitor pricing research can help give the edge in a global marketplace, empowering your business to overcome industry ▪ Store visits and store checks challenges quickly and effectively, and enabling you to realise your potential and achieve your vision. ▪ Competitor interviews ▪ From strategic overviews of your business’s competitive ▪ Customer interviews environment through to specific competitor profiles, our ▪ Company website analysis customised Competitive Intelligence Research is designed to meet your unique needs. ▪ Governmental held records 3 FOOD AND BEVERAGES INDUSTRY REPORT CLIENTS Our Food and Beverages Industry Landscape reports have been purchased by global and South African companies: 4 REPORT OVERVIEW The South African Fast Food/QSR Industry Landscape Report (142 pages) provides a dynamic synthesis of industry research, examining the local and global Fast Food Industry/QSR Industry from a uniquely holistic perspective, with detailed insights into the entire value chain – from manufacturing to retailing, market size trends, industry trends, industry drivers and challenges, and pricing analysis. SOME KEY QUESTIONS THE REPORT WILL HELP YOU TO ANSWER: For the Global Fast Food Industry Section: What are the current market dynamics of the Global Fast Food Industry? What are the key markets within the Global Fast Food Industry? What are the Global Fast Food industry trends, drivers, and challenges? For the South African Fast Food Industry Section: What are the current market dynamics (market size, market value: 2013-2018 Actual, 2019-2023 Forecasts, market environment) of the South African Fast Food Industry? What are the South African Fast Food industry trends, drivers, and challenges? What are the latest SA Food trends in terms of food festivals, food markets, food trucks, and online ingredient delivery services? For the South African Retail, Competitor, and Pricing Analysis Section: Who are the key retail players in the SA Fast Food industry? How are each of the Fast Food competitors positioned in the market? What is the latest marketing and advertising news for each of the Fast Food competitors? What is the pricing and recent promotions by category: Burgers, Chicken, Pizza, Pies, and Other? 5 SCREENSHOTS FROM REPORT 142 page report filled with detailed charts, graphs, tables, and insights 6 SAMPLE FROM REPORT: GLOBAL INDUSTRY OVERVIEW The global Fast Food market is expected to reach a total ❑ Market growth is also being experienced due to plans for robust of US$617.6 billion in 2019 (as illustrated in the adjacent expansion by key market players into developing countries. graph) and is expected to grow at a compound annual ❑ Growth is predicted to remain strong due to widening applications, as growth rate (CAGR) of 5.5% for the period 2019 to 2025. well as strengthening of consumer spending power, while increases in terms of the import and exports of Fast Food are also expected. ❑ In terms of segmentation, the global Fast Food market is segmented by type into Chicken, Burger/Sandwich, Asian/Latin ❑ Despite the forecast market growth, the high setup costs involved in American Food, Pizza/Pasta, Seafood, and Others. entering new markets, as well as the increasing health awareness trend amongst global consumers, will act as constraints in the industry in the ❑ The Burger/Sandwich segment held the largest share in 2018 as a future. Additional challenges within the market include food regulations, result of its wide product line, which includes hamburgers, intensifying competition, as well as a rising demand for high quality cheesburgers, and giant burgers, amongst others. At the same products at affordable price points. time, the Pizza/Pasta segment is expected to record the highest growth between 2019 and 2025. ❑ Growth of the global market is being driven by changes in terms GLOBAL FAST FOOD MARKET: 2019 & 2025* of consumer preferences, increasing working populations, rising (IN US$ BILLION) numbers of Fast Food restaurants, as well as the growth of 900 851.6 international cuisine in local markets. 800 ❑ More specifically, the rise of urban populations globally is driving 700 617.6 market growth due to increased demand for inexpensive, as well 600 as faster meals. Additionally, changes in lifestyles and taste 500 preferences are also driving and shaping the global market. 400 300 200 100 0 2019 2025* 7 Source: MarketDataForecast; EnvisionIntelligence; ResearchAndMarkets Image Source: Pixabay; Forbes; Pixabay2 SAMPLE FROM REPORT: SA INDUSTRY TRENDS Branded Fast Food Apps Pots and Bowls ❑ It is evident that technological advances are having a profound ❑ Pots and bowls continue to trend in the food industry, and impact on both the South African Fast Food market, as well as the specifically the Fast Food industry. First starting with the Hawaiian behaviour of consumers. poke bowl, the concept has since developed extensively to the point where a variety of different bowls are now available, ❑ In response to this, industry players are increasingly introducing featuring diverse flavours and ingredients. their own branded mobile apps and utilising creative strategies to encourage customers to download and use them. Steers, for ❑ This trend has also been observed in the South African Fast Food example, recently had a campaign where they offered their industry. For example, Nando’s offers a Boujee Bowl and Veggie customers a free 1 litre Coke with their first app order. Bowl. Their Boujee Bowl consists of chicken strips on spicy rice with seasoned corn and roasted red peppers, while their Veggie ❑ Burger King South Africa launched their app by offering the first Bowl features halloumi instead of chicken strips. Furthermore, 5,000 customers to download the app a free WHOPPER Jr. Fishaways offers Seafood Hot Pots that consist of hake nuggets burger. The Burger King app allows customers to pay for their or shrimp with spicy rice. food, gift meals to others, as well as earn 5% back on all their purchases. ❑ In terms of their breakfast offering, Kauai’s menu includes a Mexi Egg Pot, a Pesto Egg Pot, a Protein Egg Pot, and a Breakfast ❑ Kauai also recently introduced a new app, which allows customers Bowl. They also have a range of warm bowls for lunch or dinner, to schedule their order in advance, pay for the order and then skip which includes the Winter Nourish, Mexi Fresh, Asian Rainbow, the queue when they collect it. The app also enables customers to and Butta Chicken bowls. earn cash back, loyalty points, as well as Kauai rewards. ❑ It is evident that pots and bowls will continue to be relevant in the ❑ The Fast Food industry is changing, and consumers are moving Fast Food industry in the future and industry players are expected more towards online purchases. As a result, Fast Food industry to continue to offer these types of food offerings. players will continue to utilise and improve their online offerings in order to remain relevant. 8 Source: BusinessLive; Steers; Kauai; BurgerKing; Bowls; Kauai2; Nandos; FishAways Image Source: Icon; Icon2 SAMPLE FROM REPORT: SA RETAIL ANALYSIS: FAMOUS BRANDS LIMITED The company was founded in the 1950’s by George FAMOUS BRANDS LIMITED’S FAST FOOD COMPANIES: Halamandres and, since then, Famous Brands Limited has become one of the leading branded food service • Debonairs Pizza • Steers franchisors in Africa. • Fishaways • Wimpy ❑ Famous Brands Limited operates through a vertically integrated business model that consists of three pillars, namely • Mugg & Bean Manufacturing, Logistics, and Brands. ❑ The company’s brand category consists of 25 restaurant brands and houses a total of 2,871 restaurants across South Africa, the United Kingdom, Africa, and the Middle East, amongst others. ❑ Their brands portfolio consists of Leading and Signature brands. The Leading brands are also sub-divided into Fast Casual, Quick Service, and Casual Dining. ❑ Casual Dining brands includes restaurants, such as Wimpy and Mugg & Bean, whereas Quick Service brands includes Debonairs Pizza, Steers, and Fishaways. ❑ Some of their most dominant restaurant brands include Steers with a total of 600 restaurants, followed by Debonairs Pizza, with a total of 569 restaurants, and Wimpy with a total of 467 restaurants. 9 Source: FB1; FB2; FB3; FB4; FB5; FB6 Image Source: FamousB; Deb; FishA; Steers; Wimpy; M&B; Burger; Pizza; Shake SAMPLE FROM REPORT: SA COMPETITOR ANALYSIS: DOMINO’S PIZZA OVERVIEW Established in 1960, Domino’s Pizza is one of the leading Fast Food pizza franchises globally with more than Domino’s Pizza Stores: 10,800 outlets across 70 countries. 2019: 81 SA Stores ❑ In South Africa, Domino’s Pizza currently has 81 outlets across the country and offers free delivery services. Domino’s Pizza was also one of the first quick service restaurants (QSR) to launch an online ordering platform in South Africa. ❑ Their online ordering platform includes a Pizza Builder and Domino’s Tracker. The Pizza Builder allows customers to order a customised pizza and view their pizza being made on the computer screen. The Domino’s Tracker allows the customer to follow the pizza’s progress from the initial order up to the delivery. ❑ Furthermore, the company also pioneered insulated pizza bags, which are used during delivery services to ensure that the pizzas are oven-hot upon delivery.