quick service restaurants (QSR) like Domino's and Pizza Hut have been hit by the rapid expansion of food delivery platforms like Zomato and Swiggy, while quick commerce — a segment that is also led by by Zomato-owned Blinkit and Swiggy-owned Instamart — are pulling younger customers away from modern retail and other physical stores, multiple brokerage reports said.
For the overall QSR industry, revenue growth for the final quarter of FY24 was at 9% on a year-on-year basis, compared to 18% growth in the same quarter of FY23, while both same store sales growth (SSSG) and average daily sales (ADS) declined, a report from brokerage firm BNP Paribas Exane said.
Also read | Food delivery companies lean on existing users for growth
At the same time, platforms like Swiggy and Zomato continued to expand. Zomato’s average monthly active restaurant partners increased from 61,000 in FY19 to 2.7 lakhs as of FY24, while Swiggy was at 2.72 lakh at the end of FY23. Compared to this, there were only 5,300 branded stores run by QSR firms.
“We think with consumers now having more options, sales are likely to get fragmented. This is further denting the already weak average daily sales of the QSR industry, along with the general weakness in demand,” the