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The Cafes and Bars Market size is estimated to grow by USD 68.8 billion at a CAGR of 4.36% between 2023 and 2028. The market is experiencing significant growth, driven by the increasing number of establishments and the demand for innovation and customization in food menus. This trend is being fueled by consumers' desire for unique dining experiences and a shift away from traditional restaurant offerings. However, the market faces challenges from the rising popularity of home-cooked meals and increased competition. With more people opting for home-cooked meals due to health and cost considerations, cafes and bars must differentiate themselves by offering high-quality, unique menu items and exceptional customer service. Additionally, the market is becoming increasingly competitive, with new establishments opening regularly and established players expanding their offerings to stay competitive. To succeed in this dynamic market, cafes and bars must continually innovate and adapt to changing consumer preferences and trends.
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The market encompasses a wide range of establishments serving various types of food and beverages. From cozy cafes offering Breakfast, Afternoon tea, Five course meals, Vegan food items, Organic coffee, and Customizable orders to bars serving Tequila, Whiskey, Cognac, Wine, Soft drinks, and Readytodrink beverages, this market caters to diverse consumer preferences. Authentic snacks, Artisan bakeries, and patisseries add to the appeal, while Digital entertainment, gaming, graffiti, and Selfordering touchscreen kiosks enhance the customer experience. Cafe culture thrives with Coffee drinking culture and Hot Drinks dominating the scene. Brands like Restaurant Brands International, Starbucks, Whitbread, and many others have significantly influenced the market. The Digital Transformation has led to the adoption of technology in cafes and bars, enabling Remote Work cafes and other innovative concepts.
The increasing number of cafes is a key factor driving the market growth. The growing trend of urban youth socializing in cafes is set to drive the market. With over 56% of the global population in urban areas, a 1.2 million km2 increase in urban built-up areas is projected by 2030. This urbanization, coupled with a significant white-collar demographic, has led to a surge in specialty coffee shops. Major cafe chains like Starbucks Corp. and Dunkin Brands Group Inc. are expanding in developing economies, with Starbucks reporting an 8% increase in global store count to 18,416 in October 2022.
The market is also influenced by the rise of coffee chains offering products like iced coffee, particularly appealing to the youth demographic. Infrastructure growth in countries like India, Indonesia, Iran, and Iraq provides opportunities for coffee chains. Increased travel has contributed to higher coffee intake, fueling the market growth.
The demand for innovation and customization in food menus is a key major market trend. Consumers, particularly millennials, are seeking unique and bold flavor combinations in food, driving demand for innovative and exotic options. The desire for customizable meals, catering to daily calorie intake, is evident, with examples like Shake Shack's customizable Chick'n Shack chicken sandwich.
Furthermore, this trend, fueled by factors like medical needs, food allergies, and weight reduction plans, emphasizes the importance of aligning food choices with individual tastes. Achieving the right flavor profile not only satisfies consumers but also encourages repeat visits, contributing to the expected growth of the global market.
The threat from the rising popularity of home-cooked meals is a key challenge hindering the market growth. Some individuals favor homemade meals over restaurant dining due to concerns about the perceived unhealthiness of restaurant food, which often contains high levels of carbs, added sugar, salt, unhealthy fats, and artificial additives.
Furthermore, this increases the risk of diseases like heart problems, diabetes, and obesity. Additionally, homemade meals are more cost-effective than dining out, and they offer greater nutritional value with fresh, hygienic ingredients. This shift towards healthier home cooking poses a potential threat to the growth of the global market, especially among health-conscious consumers like millennials and baby boomers.
The market share growth by the beverages segment will be significant during the forecast period. The beverage segment includes the sales of hot and cold beverages like coffee, tea, and alcoholic beverages such as tequila, whiskey, and cognac. The major driving factor is the increasing demand for speciality and premium hot beverages like coffee.
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The beverages segment was valued at USD 177.10 billion in 2018. Rapid growth for naturally sweetened beverages is also driving the demand. Carbonated drinks sweetened with cane sugar (for example, Coca-Cola Life) are becoming more popular in the US and UK markets. Consumers are becoming interested in carbonated soft drinks flavored with tropical flavors such as passion fruit, pineapple, and mango. As a result, suppliers are developing new items, such as tropical flavors. Such factors are expected to drive the growth of the beverage segment of the market during the forecast period.
Europe is estimated to contribute 44% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
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In Europe, snacks and mini-meals commonly consist of light options like tacos, sandwiches, donuts, and milkshakes, allowing for convenient on-the-go consumption. In the UK and Germany, consumers show a preference for stuffed and topped light food products, such as apple pie with vegan cream and cookies. For example, vendors in European cafe and bar markets offer donuts filled with custard and topped with toffee or filled with apple pie and caramel sauce. These innovative product offerings are anticipated to drive food sales in European cafes and bars.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD billion " for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.
US Foodservice Market by Type, Solution, and Sector - Forecast and Analysis
Pubs, Bars and Nightclubs Market by Product, Application, and Geography - Forecast and Analysis
UK Foodservice Marketby Type, Application, and Sector - Forecast and Analysis
The market is evolving with a focus on instafriendly cafes and hot cross bun-filled dining, catering to evolving consumer preferences and increasing consumer awareness. Upscale bars and remote work café are becoming popular, reflecting a shift towards culinary choices that prioritize ethical consumerism and sustainability requirements. The market is also affected by price volatility in ingredients and supplies, necessitating adaptive strategies to maintain quality and affordability. As consumer awareness grows, there is a greater emphasis on sustainable practices and ethical sourcing, influencing how businesses meet both aesthetic and environmental standards.
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Market Scope |
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Report Coverage |
Details |
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Page number |
170 |
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Base year |
2023 |
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Historic period |
2018 - 2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 4.36% |
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Market growth 2024-2028 |
USD 68.8 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
4.12 |
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Regional analysis |
Europe, APAC, North America, Middle East and Africa, and South America |
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Performing market contribution |
Europe at 44% |
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Key countries |
US, China, Japan, UK, and France |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Berkshire Hathaway Inc., BJs Restaurants Inc., Brinker International Inc., Caffe Nero Group Ltd, Caribou Coffee Operating Co. Inc., Coffee Day Enterprises Ltd., Doutor Coffee Co. Ltd., Ediya Co. Ltd., Inspire Brands Inc., JAB Holding Co., Jollibee Foods Corp., LUIGI LAVAZZA SpA, McDonald Corp., Red Robin Gourmet Burgers Inc., Restaurant Brands International Inc., Starbucks Corp., Stonegate Pub Co. Ltd., The Coca Cola Co., Whitbread PLC, and YUM Brands Inc. |
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Market dynamics |
Parent market analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for market forecast period |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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