Mexico Foodservice Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Mexico Foodservice Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The Mexican foodservice market is projected to register a CAGR of 5.30% during the forecast period, 2022-2027.

The in-restaurant dining and street stall segments that hold a noteworthy portion of the market were the worst-hit segments by COVID-19, largely due to the travel curbs, a general avoidance of people for large gatherings, and social distancing regulations closing millions of restaurants. The restaurants and bars located within mall premises in Mexico have already shut down, with a significant percentage unlikely to reopen. Moreover, the post-crisis recession is expected to drive a contraction in food service and consumers’ spending through an overall focus on convenient and affordable options.

The rapid growth of the fast-food sector in the country led to the expansion of more fast-food chains. This sector’s growth can be attributed to the convenience and availability of foods at lower costs compared to independent full-service restaurants.

Franchising and sub-franchising have become very popular tools for multinational and local players in the country. Foodservice chains like McDonald’s are prominent examples of the largest (QSR) restaurant chains in the country.

Mexico experienced rapid growth in online food delivery in the study period. Due to the COVID-19 outbreak in 2020 and social distancing norms, the number of footprints in restaurants reduced. However, there has been a surge in the online delivery in Mexico. During the pandemic, major players in the industry launched e-commerce websites that further drove the online sales of food. The convenience of the delivery service is attracting consumers to opt for online food delivery services. Moreover, the consumer-friendly interphase of the website and application of the food delivery players is attracting consumers toward online food delivery services.

Although the market is dominated by independent consumer foodservice, chained consumer restaurants are experiencing the fastest growth, with numerous global and local chains widely expanding their branches in the country. Chained consumer food service relies on effective marketing, advertising, and product campaigns to create awareness about their offerings. Apart from this, chained restaurants also focus on options for dine-in, drive-throughs, and home delivery options. The companies are implementing strategic initiatives to capture the market share and expand their regional presence.

The Mexican foodservice market is highly competitive due to numerous local and international players capturing the market. Some of the leading players, including Alsea, Restaurantes Toks (parent company- Grupo Gigante), Arcos Dorados México, CMR, and FEMSA – Oxxo, are holding significant market shares. This growth is attributable to their higher market penetration, reflecting a strong industry grip through subsidiaries and brands. International fast-food chains dominate the pizza consumer foodservice and fast-food sectors in the country. Higher prominence of brands, such as KFC, McDonald’s, Burger King, Subway, Little Caesar’s Pizza, and Domino's Pizza, was witnessed in the review year.

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