The catering industry is one of the largest in Europe. Some countries, such as France in particular, are known to be true icons of gastronomy. In this article, we will analyze the restaurant industry in Europe via the SWOT matrix. As such, we will talk about its strengths and weaknesses, which constitute an internal diagnosis, and its opportunities and threats, which will refer more to the external diagnosis.
SWOT analysis
The strengths
Europe is the continent with the most gastronomic countries, which is one of the main strengths. There are indeed several kinds of cuisines that are classified as intangible heritage of humanity, such as French gastronomy, which we mentioned earlier in the introduction.
In Europe, the culinary field is one of those knowledge that is passed down from one generation to the next, so it is preserved for many years. Many foreign tourists travel across Europe in search of great restaurants and discoveries of culinary novelties, they are looking for traditional dishes, and authenticity in the cuisine.
In addition, many French restaurateurs have been trained by prestigious establishments, such as Ferrandi in France or Alma in Italy, a non-exhaustive list. These establishments have the reputation of having trained starred chefs, known internationally. There are a lot of requests from foreign students who want to enrol in Europe.
Earlier, we were talking about tourists, it should be noted that in recent years, gastronomic tourism has advanced a lot.
The European-style restaurant model has a wide variety of formats. On the continent, there are food trucks offering all kinds of food, luxury brasseries and restaurants, fast food, etc. This diversity remains an asset, especially in the current context, as consumer trends and habits are constantly evolving.
The weaknesses
The European restaurant model, like many sectors, has some weaknesses. Among them, a fairly high operational cost, rents for brands, salaries which are also high depending on qualifications or more generally all the costs which are often a brake on real profitability.
Independent institutions can encounter problems with margins, which are often less than 5%.
Restaurants in Europe certainly bring a high rate of consumers, and some regions, some countries are more affected than others during certain periods, especially those of the school holidays. One of the main problems remains the dependence on the staff, because to run a restaurant, you need a lot of people, waiters, dishwashers, cooks, clerks, etc.
Young people lose interest in this type of work during the seasons, the younger generations do not want to get tired, preferring to earn their living elsewhere, the internet offering many possibilities. It is often hard work, which is no longer the priority for many of them.
In addition, it is still a sector where the automation of tasks remains complex, there are no real innovations on this side in traditional establishments.
Finally, the laws and various regulations are very strict, and above all, they are not the same from one country to another, even within Europe. There is a lot of work and administrative burdens, especially for small restaurants.
The opportunities
The restaurant world has many growth levers, with the importance of ecology taking an increasingly important place in the regulations but also more generally in the marketing strategies of the various establishments.
Indeed, in today's society, many consumers are very concerned about the ecological issue, so it is essential that the sector as a whole takes this trend into account. Thus, catering establishments take into account the need to give the exact origin of the products they offer, in the interests of transparency. Anti-waste operations are also more and more numerous, they show the responsible side of restaurants, and make it possible to limit waste.
In addition, there are more and more innovations regarding the digital transition, with, among other things, applications to manage reservations to limit the margin of error, to better manage stocks, or to develop loyalty software, allowing you to remain competitive. Artificial intelligence is a valuable help in this sector, as it makes it possible to define forecasts concerning ridership, or everything related to energy consumption.
The fact that Europe is one of the leading tourist destinations makes it possible to develop projects such as cooking classes, multi-sensory dinners or others.
Little by little, new concepts are emerging, such as restaurant and concert mixes, co-working spaces and cafés, in order to develop ever more innovative customer experiences. Every institution wants to develop something new whenever possible, in order to fight against excessive competition.
The threats
The restaurant world in Europe is facing a series of relatively serious threats. Earlier, we were talking about certain regions, which work almost exclusively with tourism, and this is without counting the many instabilities at the economic level. Geopolitical conflicts are leading to higher prices, lower purchasing power, and going to restaurants is no longer a priority for consumers.
In recent years, home meal delivery platforms, such as Uber Eats or Deliveroo, have somewhat changed the way consumers eat. To meet the demand, some restaurant owners work with these platforms and therefore lose their autonomy.
It should also be noted that restrictions on certain foods as well as controls in establishments make recipes more difficult to make, and customers are also more demanding, and harder to impress.
Finally, young people no longer consume as they used to. They are looking for ways to eat quickly, and they are increasingly focused on vegan food. Restaurants must absolutely adapt for fear of seeing their attendance drop drastically in the coming years.
Conclusion
The restaurant industry is subject to a set of factors that force it to constantly change and adapt. Economic crises, technological innovations, new expectations, restaurateurs must remain on the alert so as not to be threatened by omnipresent and constantly renewed competition.
In Europe, the restaurant sector is forced to innovate, regardless of whether the establishments are starred or not. Today, it's a question of knowing how to innovate, how to improve the customer experience, well beyond offering expensive or inexpensive dishes.
https://get.apicbase.com/restaurant-industry-report/
https://www.ibisworld.com/europe/industry/restaurants-takeaways/200255/