Challenges

The Food and Beverage industry in the UAE has established its dominance over the middle east over the past decade. Dubai in particular continues to attract international & home-grown F&B brands, as it is a melting pot of cultures. Due to a global economic slowdown people are becoming cautious spenders and have reduce the splurge on overly expensive dining. According to a recent study 81% of the people claimed that they eat outside as much as they did in 2016, if this is the case why is there a decline in profit margins. This is primarily got to do with the supply side, as the demand for food orders remaining almost the same as previous years, there is an oversupply of restaurants in the country. As a result each restaurant on its own is not very profitable. A recent study done by JLL claim that the retail space for leasing is going to increase by 1.5 million square km by 2019. Addition to this the rising cost of overheads to run business as well as earning profits adds to the burden.