Market Trends of malaysia foodservice Industry
Quick service restaurants (QSR) in Malaysia observing increased popularity among young people in densely populated cities like Kuala Lumpur, Kota Bharu, and Klang
- The Malaysian foodservice market is majorly driven by cafes & bars, followed by full service and quick service restaurants. The increasing number of cafes and bars in Malaysia indicated a positive Y-o-Y growth rate of 13.16% from 2021 to 2022. This was due to the increased consumption of alcohol, mainly beer. As of 2022, nearly 69% of people preferred to drink beer. Also, the penetration of cafes and coffee shops is due to the rise in coffee consumption. As of 2022, nearly 800,000 (60 kg) bags of coffee were consumed in Malaysia.
- Cloud kitchen is the fastest-growing foodservice type, and it is projected to record a CAGR of 15.82%, by value, during the forecast period. This can be due to the increased penetration of the internet and the growing demand for online food delivery services. As of 2022, nearly 84.2% of Malaysian people used the internet. Post-pandemic food deliveries and takeaways have grown as more than 85% tend to order food from online delivery channels. Foodpanda, GrabFood, and DeliverEat are popular food delivery channels. As a result, the number of cloud kitchen outlets grew by 12.43% in 2022 compared to 2020. The increased popularity of quick service restaurants is due to young people's propensity to eat fast food frequently. As of 2022, approximately 84% of young students in Malaysia often ate fast food as they perceived it as an economical and convenient lunch option. The leading quick service restaurant chains in Malaysia with the highest number of stores are KFC, Domino's Pizza, McDonald's, and Subway, with 600, 240, 320, and 230 outlets, respectively. In order to reach more customers, these restaurants have expanded in densely populated cities like Kuala Lumpur, Kota Bharu, and Klang. Thus, with the rising number of outlet counts, the sales growth of the QSR segment increased by 11.72% in 2022 compared to 2021.
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Malaysia's cafes and bars saw increased demand from tourists and locals, driven by the growing tourism industry, rising disposable incomes, and increasing popularity of alcoholic beverages
- The average order value in the Malaysian foodservice market was the highest among cloud kitchens in 2022 compared to other foodservice types, with a price of USD 4.18. Due to the COVID-19 pandemic, the number of orders placed through food deliveries and takeaway services observed an 8.53% increase from 2020 to 2022. Similarly, the average order value increased by about 1.23% from 2017 to 2022. However, due to greater flexibility, most restaurants have converted their warehouses into virtual kitchens to boost their revenue by increasing takeaway orders.
- The demand for cafes and bars is anticipated to rise as more tourists visit the country's themed cafes and nightclubs featuring live dance performances, along with unusual food and premium alcoholic beverages. In 2022, Malaysia had more than 3 million visitors from various regions. Alcoholic beverages, including beer, cocktails, and mocktails, are becoming popular in bars and clubs. In 2022, the average price of beer in Malaysia was USD 3.6 per 300 mL, whereas the average prices of non-alcoholic beverages included coffee at USD 1.7 per 150 mL, tea at USD 1.02 per 150 mL, and vanilla latte at USD 3.27 per 300 mL. Full service restaurants have grown due to the popularity of ethnic cuisines, mainly Asian and North American. Chinese cuisine is becoming popular among the locals and Chinese immigrants. The number of Chinese immigrants is also growing; in 2022, nearly 82,000 entered the country. The popular dishes offered by the FSRs are Chicken 65, Wonton Mee, and Chicken Teriyaki, with an average price per 300 gm of USD 4.5, USD 5.2, and USD 5.42, respectively. Thus, the average order value of FSRs grew by 1.27% in 2022 compared to 2020.
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