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Online ordering, changed customer perceptions key trends in food service industry, says Jubilant FoodWorks

Jubilant FoodWorks (JFL) is the country's leading quick service restaurants (QSR) operator and master franchise of brands such as Dominos and Dunkin' Donuts.

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The trends in the food service industry are expected to turn towards online ordering, changed customer perceptions about product consumption and services with increased prominence on hygiene and safety, according to Jubilant FoodWorks.

This will be with an 'exponential increase' in the use of digital solutions as the world deals with the concept of contact-less interaction among people, the company said in its latest annual report.

Jubilant FoodWorks (JFL) is the country's leading quick service restaurants (QSR) operator and master franchise of brands such as Dominos and Dunkin' Donuts.

Besides, the rising presence of international brands, stronger back-end infrastructure, acceptance of new cuisines, changing lifestyles and aspirations, and the rise of entrepreneurial ventures will fuel growth, it added.

'It is expanding rapidly due to the high percentage of the young and working population, increased frequency of eating out amid time-pressed schedules, and the growing influence of cross-cultural dietary patterns, owing to the strong presence of international brands,' JFL said.

The Indian food service industry witnessed exceptional growth in the past decade, it said.

Talking about the outlook, JFL said the Indian economy is navigating uncertain times with policy reforms.

Moreover, pro-investment measures such as reduced tax rates on new capital investment, lowered interest rates and easy credit dissemination, among others, will yield benefits in the medium-to long-run. Consumption cycle can only be re-invigorated by putting more money in the hands of consumers, it added.

'Rising population, growing income levels and evolving consumer preferences and lifestyles have opened promising prospects for the food of certain standard and quality,' it said.

JFL, part of the Jubilant Bhartia group, operates brands like Domino’s Pizza, Dunkin’ Donuts and Hong’s Kitchen. It recently added Indian cuisines like biryani and kebabs by launching Ekdum.

It has also signed a master franchise and development agreement with Popeyes, an American multinational chain of fried chicken fast-food restaurants, for markets as India, Bangladesh, Nepal and Bhutan.

Factors like younger demographics, increased participation of women workforce, India-centric offerings, value pricing, online food ordering and food delivery are going to be demand drivers of the industry, it said.

This will be also helped by the growing acceptance of online delivery in smaller tier-II, III and IV cities.

'This is particularly led by an increase in the percentage of working population in these cities. These cities have already started to see increased traction in the adoption of online food ordering apps,' the report said.

JFL said India's urban cities, across all economic classes, are increasingly opting to eat out during leisure outings.

'This trend is most popular among the millennial age group between 15 and 34 (around 447 million, 34 per cent of the population).

'India has the highest number of millennials globally, and the population is expected to grow faster than other groups, which is likely to encourage eating-out behaviour among Indian consumers,' JFL said, citing a Technopak report.

Moreover, the proportion of women workforce in India has been rising, majorly in the urban areas.

'Due to these factors, families order more multi-cuisine food via online channels and eat out, thereby contributing to the QSR market's growth,' it said, adding value-conscious Indian customers have found interest in combos and value meals common across QSR chains.

As on March 31, 2021 JFL was operating 1,360 restaurants of Domino’s Pizza and 24 of Dunkin’ Donuts. Its revenue from operations was Rs 3,268.87 crore in FY21.