It is gratifying to note that this year the restaurant business in Ukraine is developing according to forecasts .jpg)
marketers, without revealing any particular surprises.
In Kyiv, mid-price establishments (with an average bill of 50-70 UAH per person) are experiencing growth, while the opening of new luxury establishments has slowed significantly. Macroeconomic factors have played a role: large businesses with multimillion-dollar revenues aren't growing as rapidly as small and medium-sized businesses, meaning the elite audience isn't expanding. Consequently, the circle of clients who can afford luxury establishments has already been established and is barely expanding. Luxury establishments can only share the same clientele, "poaching" them from each other, but they don't create new ones. Therefore, the risk of opening an establishment with an average bill of 150-200 UAH is much higher than that of a mid-price establishment, especially considering the significant financial investments (from $1 million and up) in the luxury sector.
Macroeconomic factors significantly influence the development of the restaurant business in other Ukrainian cities. A clear correlation can be traced between the development of high-end or mid-range establishments and the development of large or medium/small businesses. Cities often exhibit a certain "polarity" of development: if the high-end sector is popular, then so are affordable establishments. In this case, the mid-range segment simply "falls out." The situation is such that the development of mid-priced restaurants (cafes, bars, etc.) is an indicator of both the city's economic development and the level of societal sophistication. It sounds rather grandiose, but it's true nonetheless.
But let's return to Kyiv. The lower price segment of the Kyiv restaurant business is growing slower than the mid-price segment. There are several reasons for this: establishments with a low average bill benefit from turnover (the turnover ratio per seat should be at least 1.2). To achieve this, it is necessary to find a front-facing location with a passenger flow of at least 1,500-2,000 people per hour, and this is quite a challenge in Kyiv. Low-price establishments are generally not visited intentionally; spontaneous visits account for over 70% of visits. Therefore, the currently popular low-price establishment formats (fast food restaurants, cafes, bars) can only be successful if the premises are carefully selected and the rental rate allows for profitability. In this regard, the currently extremely popular Quick&Casual format is only developed to 20-25% of its potential, as it is very difficult today to find a space that meets all requirements and is designed for a large number of seats.
As for the fast food and low-end cafe market, a huge number of pizzerias have opened in the last year (more than in the last three years combined). It seems that no matter where you open a pizzeria in the city, it will be in demand.
Countryside establishments are rapidly expanding, especially those located on key highways such as the Odessa, Zhitomir, and Obukhiv highways. It has been observed that during summer weekends, restaurants located within the city limits are significantly emptier, while those located outside the city are overcrowded. This trend is becoming more pronounced every year. Only those city restaurants located in recreational areas (parks, embankments) are benefiting. This phenomenon is most likely related to the emerging tradition of a full-fledged family vacation. The idea of "outdoor recreation" is becoming increasingly civilized. Countryside establishments typically follow the same pattern: a restaurant (either in a single building or in separate cottages), a hotel with 15-25 rooms (either in a single building or in a cottage format), a barbecue (shish kebab is an essential attribute of outdoor recreation), a children's playground, and sometimes a small zoo or swimming pool. Despite the rapid growth of suburban establishments, they are often unbranded, relying on passing customers and, much less often, on Kyiv residents who make a special trip to the establishment. In this case, we are faced with a situation where supply creates demand – any successful suburban establishment finds its customers. Outside the city, it is easier to purchase land, build your own restaurant space, and become its sole owner. This is an undeniable advantage, as the vast majority of Kyiv restaurants rent their premises and experience serious crises when property owners change, leases are cancelled, or rents increase.
As expected, the development of tea and coffee shops and pastry shops has accelerated over the past year. More than 10 have opened in Kyiv this year. Established cafes are doing well, and new ones are opening, such as "Nouvelle" in Passage and "Kofium" on Kostyolna Street. Establishments with prices in the 15-25 UAH range, offering coffee, tea, baked goods, pastries, and chocolate, are becoming popular. However, the expected boom has not materialized. However, the coffee shop and pastry shop segment in Kyiv is close to saturation. The strategically correct move is to create a chain of such establishments rather than a single coffee shop or pastry shop. This is primarily due to technological reasons: it is much more profitable to establish your own workshop to serve several establishments, and marketing reasons: consumers quickly become accustomed to a particular brand and product.
Restaurant business trends, of course, also reflect trends in the development of specific cuisines. Much to our surprise, preferences by cuisine type vary widely, especially across Ukraine's regions. A strong preference is for a specific product, rather than a specific type of cuisine per se. For example, preferences for meat, often a specific type (pork, chicken), served in various cuisines, or for fish and seafood. In Kyiv, certain cuisines generally have established groups of admirers, while other consumers prefer their favorite product in its favorite preparation, regardless of the cuisine represented by a given dish. Therefore, the type of cuisine most commonly found in various establishments across Ukraine can be described as mixed (in some cities, it's called the oddly named "international"), with an emphasis on a specific group of dishes or preparation method. Accordingly, the concept of restaurant cuisine is changing. Dishes are becoming more naturalized, with less additional processing, and the aim of presentation is to highlight the main ingredient, not to "camouflage" it. Customers should be able to clearly see what they're eating. More and more restaurants are emphasizing the natural use of ingredients rather than the complexity of recipes when creating their menus. Hence, the conclusion: long live signature cuisine, which allows you to creatively rework all existing cuisines of the world and create your own unique product that will attract customers.
A similar situation is observed with the preference for bar products, each of which can be the basis for the creation of an entire format: coffee shops, beer bars, liquor stores, establishments with an emphasis on cocktails or wine.
Overall, it can be noted that the purposes of visiting restaurants are beginning to change, increasingly focusing on food and the social interaction that goes with it.
And yet, there are still untapped niches in this business. For example, specialized children's cafes – children's themes are present in many establishments, but they rarely receive special attention. Promising areas of development include local establishments serving residential and suburban areas (pizzerias, cafes), so-called "one-street restaurants." Enterprises focused on specific product preferences (dish, menu item, or drink) are underrepresented. Catering and food delivery to homes or offices offer incredible scope for development. It's also worth noting the potential for music-focused establishments (not nightclubs, but rather art restaurants and art cafes). Establishments based on an existing model are very successful from a business perspective; this is the principle underlying the idea of franchising. This minimizes the risk of concept failure. "Kozyrnaya Karta" and most fast food restaurants are following this path. Any successful food service business is truly a successful technology, and like any technology, it can be replicated in any city in the world. The active development of chains by well-known restaurant brands is just around the corner.
