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SIAL|Ten Years of Change: 2024 Hong Kong Food and Beverage Industry Outlook

2024.04.12

According to SIAL, restaurants and bars in Hong Kong provide daily needs for the locals and wonderful experiences to tourists; however, due to the setbacks during the COVID-19 pandemic and the “heading north” consumption trend among Hong Kong residents in the post-pandemic era, many local restaurants and bars are facing challenges such as closures, huge revenue losses, and difficulty in recruiting. It has been one year since the pandemic ended. What changes have occurred in Hong Kong’s restaurants and bars today?

 

According to the statistics from the Food and Environmental Hygiene Department, in 2013 there were 8926 general restaurants (including Chinese restaurants, steakhouses, hot-pot restaurants, etc.) and 3155 light refreshment restaurants (including congee shops, noodle shops, and coffee shops, etc.) in Hong Kong. There were 5975 liquor licenses, with general restaurants accounting for the majority. Over the past ten years, there has been a significant increase in the above-mentioned figures. By 2022, statistics show that there were 12630 general restaurants and 4280 light refreshment restaurants in Hong Kong, with 9,200 liquor licenses. Based on the above data, the growth rate of general restaurants is 41.6%, that of light refreshment restaurants is 35.7%, and that of liquor licenses is 53.9%, indicating considerable growth.

 

More Closures than Openings

 

Yet, the number of opening and closing restaurants reveals a less optimistic situation. According to the “OpenRice Market Insights – The Most Comprehensive Hong Kong Dining Market Intelligence”, in October 2023 there were 338 new restaurants opened but 401 restaurants closed down; in November there were 357 new openings and 406 closures; as of December, there were 337 new openings and 314 closures. To conclude, the number of closures exceeded the number of openings in October and November, and the number of openings and closures in December was quite close, reflecting a worrying situation in which there is a notable number of closures despite the continuous emergence of new restaurants.

 

In addition, with reference to the Volume Index of Restaurant Receipts (after deducting the price change factor in the Value Index of Restaurant Receipts) of the Census and Statistics Department, the Volume Index of Restaurant Receipts ten years ago in 2013 was 137.8, and the figure in 2019 before the COVID-19 outbreak was slightly lower at 131.7. In 2023, a year when Hong Kong fully resumed normal travel, the indices for the first to third quarters were 118.7, 117.2, and 115.0 respectively, suggesting that the industry has not returned to the pre-epidemic level, but also facing a declining trend.

 

SIAL believes that the figures tell all. While the number of general restaurants, light refreshment restaurants, and liquor licenses has continued to grow after the pandemic, the ratio of restaurant openings to closures shows that the catering industry is experiencing significant difficulties. The Government and trade associations must devise more practical long-term plans to assist the industry survive the economic winter.

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