Limited-Service Restaurants Market
Limited-Service Restaurants Market Analysis, By Type (Fast Food Restaurants, Drive-in Restaurants, Pizza Delivery Shops, Carryout Restaurants), By Distribution Channel (Offline, Online), By Region – Global Market Insights 2023 to 2033
Analysis of Limited-Service Restaurants Market Covering 30+ Countries Including Analysis of US, Canada, UK, Germany, France, Nordics, GCC countries, Japan, Korea and many more
Limited-Service Restaurants Market Outlook (2023 to 2033)
The global limited-service restaurants market is valued at US$ 1,160 billion in 2023. The market is predicted to reach a valuation of US$ 1,890 billion by the end of 2033, expanding at a CAGR of 5% over the next ten years.
- 'Order, pay, take the food' is the basis of the functioning of limited-service restaurants. The general purpose of limited-service restaurants is to provide convenient services to consumers while minimizing their operational costs.
Quick response time and easy access are the main characteristics of limited-service establishments in the restaurant industry. This industry includes organizations primarily engaged in providing food services (except nonalcoholic beverages, bars, and snacks). At these places, patrons generally select or order items and pay before eating.
Drinks and food items can be consumed inside restaurant premises, delivered at the consumer’s location, or taken out. There are many companies providing food service facilities along with alcoholic beverages. In limited-service restaurants, actual services are kept to the minimum possible and staff-consumer interactions occur only during meal purchases.
Limited-service restaurants or LSRs are typical restaurant setups where consumers enquire about food products or look up menus, pay for their respective food options, and obtain a receipt of the payment. After this, they get their order delivered. Consumers can take away their food or can enjoy their meals inside the establishment.
However, full-service restaurants are defined as restaurant establishments where consumers are provided with a wide variety of services, including a broad menu on the table, waiting services, and services at the booth or counter. These restaurants are characterized by meal provisions that are ready to be consumed within respective premises or takeout.
In full-service restaurants, consumers pay for the service and meal after availing of all facilities, whereas in limited-service restaurants, they need to pay for their meals beforehand.
Limited-Service Restaurants Market Size in 2023
US$ 1,160 Billion
Forecasted Market Value (2033)
US$ 1,890 Billion
Estimated Market Growth Rate (2023 to 2033)
Canada Market Growth Rate (2023 to 2033)
Germany Market Growth Rate (2023 to 2033)
Fast Food Restaurants Segment Growth Rate (2023 to 2033)
Key Companies Profiled
Which Factors are Contributing to Increased Number of Limited-Service Restaurants Globally?
“Convenience of Limited-Service Restaurants Attracting More Consumers”
Very less time is required for the preparation of food products in limited-service restaurants. Moreover, no table service can result in maximum satisfaction of consumer cravings if they are short on time. There are a lot of limited-service restaurant venues that are optimizing takeout as well as delivery services owing to their limited menus. The convenient services offered by these restaurants are expected to contribute to the growth of the limited-service restaurants market.
“Lower Food Costs Creating Substantial Opportunities”
Various limited-service restaurants such as fast-food chains require less expenditure in comparison to full-service restaurants. LSRs widely use frozen ingredients instead of fresh ones due to their convenience and affordability. Thus, consumers can get different food products at economical prices, which is further expected to increase sales of food products from these restaurants.
Limited-service restaurants can get noticeable profit margins due to their lower operating costs (food costs, labor, and real estate) compared to full-service restaurants. LSRs can get a profit margin of 6-9%, whereas the margin is 3-5% in the case of full-service restaurants.
All the above-mentioned benefits of limited-service restaurants are expected to generate lucrative opportunities in the industry over the coming 10 years.
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Which Key Challenge is Experienced by Limited-Service Restaurant Operators?
“Falling Percentage of Casual Diners across the World”
The rising cost of end products owing to the increasing adoption of third-party food delivery services around the world is creating challenges for such restaurants. In addition, the falling percentage of casual diners is also projected to restrict sales of foods from limited-service restaurants globally.
However, some recent developments, including sustainable food preparation processes, drone delivery services, and the trend of plant-based products are anticipated to generate lucrative opportunities for industry players over the coming years.
Which Factor Contributes to the Growth of the North American Limited-Service Restaurants Market?
“Expansion of Limited-Service Restaurant Chains Due to Increasing Demand for Convenience Food”
North America is projected to hold a noticeable share of the global market revenue owing to the rising number of single-person households and an increasing number of adults who are living away from home. In addition, the rising disposable income of people is predicted to increase their spending capacity, which can further generate opportunities for players in the target market.
The percentage of the adult population living away from home is predicted to stimulate the demand for convenience foods from limited-service restaurants across the region.
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Why are Limited-Service Restaurant Chains Growing Substantially in the United States?
“Increasing Number of Single-person Households Generating Higher Demand for Ready-to-eat Food”
- According to data provided by Fact.MR, a market research and competitive intelligence provider, the valuation of the United States market was US$ 280 billion in 2022.
The growth opportunities are attributed to the increasing demand for convenience foods due to the rising population of working-class people. Moreover, a growing number of single-person households is also predicted to generate lucrative opportunities for market players.
- Demand for quick service restaurants (QSRs) in Canada is expected to advance at a CAGR of 4.2% from 2023 to 2033.
How is Japan Forecasted to Perform in the Asia Pacific region?
“Increasing Incidences of Home-Delivery Services in Japan”
- Sales of limited-service restaurant food in Japan are forecasted to grow at a CAGR of 2.6% from 2023 to 2033.
Growth opportunities in the market are attributed to rising home seclusion and several options that are available for home delivery/takeout facilities.
Why is the Number of Limited-Service Restaurants Increasing in Germany?
“Growing Popularity of One-the-go Food among Busy Consumers”
- Demand for food services in Germany is projected to expand at a CAGR of 3.5% during the forecast period.
Market growth is attributed to several factors, including affordability. On-the-go food is generally appreciated by busy customers as it requires less time for preparation. In addition, consumers are giving preference to home delivery services, which is estimated to create growth opportunities for market players.
Why are Fast-Food Restaurants Increasing Around the World?
“Popularity of Convenience Food Resulting in Increasing Number of Fast-Food Restaurants”
Based on type, the global industry is segmented into fast food restaurants, drive-in restaurants, pizza delivery shops, and carryout restaurants.
- The fast-food restaurant segment is predicted to advance at a CAGR of 5.9% from 2023 to 2033 and reach US$ 630 billion by the end of 2033.
Growth of fast-food restaurants is attributed to increasing demand for ready-to-eat meals, on-the-go snacks, convenience foods, and cold cuts. The increased consumption of fast-food is due to millennials’ hectic lifestyle along with the increasing working-class population around the world.
What is Complementing the Popularity of Limited-Service Restaurants?
“Online Distribution Channels Contributing Substantial Share to Revenue”
Online and offline channels are used for the distribution of foods prepared by limited-service restaurants. Between these two, the traction for online distribution channels is increasing among millennials owing to the rapid penetration of online food delivery services, including Zomato, Swiggy, Uber, and others. These channels ensure convenient delivery of food to consumers’ doorsteps.
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Key limited-service restaurants around the world are increasing their expenditure to strengthen their supply chain management systems to ensure maximum satisfaction to consumers. In addition, LSR restaurants are also aiming to deliver quality products to end users while maintaining product standards and ensuring minimal environmental impact. These efforts are expected to fuel growth in the limited-service restaurants market.
Leading market players are coming up with new developments to attract a larger consumer base.
- In April 2021, McDonald’s Japan introduced the Samurai Mac burger in its regular menu.
McDonald’s Corporation, Starbucks Corporation, Papa John’s International, Inc., Burger King Corporation, Subway, The Wendy’s Company, Dunkin’ Donuts LLC, and Domino’s Pizza, Inc. are some of the prominent limited-service restaurant chains that are operating globally.
Segmentation of Limited-Service Restaurants Industry Research
By Type :
- Fast-Food Restaurants
- Drive-in Restaurants
- Pizza Delivery Shops
- Carryout Restaurants
By Distribution Channel :
By Region :
- North America
- Asia Pacific
- Latin America
- Middle East & Africa
- FAQs -
The market for limited-service restaurants stands at US$ 1,160 billion in 2023.
The global market is expected to reach US$ 1,890 billion by the end of 2033.
The fast-food restaurants segment is expected to expand at a CAGR of 5.9%.
The global limited-service restaurants market is forecasted to expand at a CAGR of 5% from 2023 to 2033.
The market in Canada is predicted to advance at a CAGR of 4.2% through 2033.
North America is anticipated to hold a substantial share of the global market revenue over the decade.