THE FUTURE OF F&B

Several factors make Iran’s F&B market a potentially rewarding one. First, it has a very young population that enjoys dining out. Second, it has a rooted, rich and very exotic culinary history. Finally, none of the major global brands are yet active or present in the market. Some believe that Iran’s F&B market has long been irrelevant for brands and investors. A great part of this reservation stemmed from the fact that the majority of global quick-service (QSR) and fast casual brands are British or US corporations. They are now sanguine about sanctions. While Tehran is a city of 15 million inhabitants, there are less than 3,000 restaurants, with many failing to meet international standards. The fact is that food and beverage has never been subject to sanctions. Among existing operators, few improvise and keep up with modern international formats. Local operators continue to copy concepts. However, the biggest opportunities are in fast casual dining. Fine dining is neither inclusive nor scalable and the QSR segment faces major challenges in its supply chain. The four major challenges relate to: Location (real estate), maturity of the sector or the PMI (Patron Maturity Index), lack of development and growth capital, and voids in service sophistication.

Strengths

• Young demographics: Guaranteed demand • Untapped market: Lack of saturation • Home-grown tech sector: Online Food

Ordering (OFOS)

Weaknesses

• High rents and shortage of modern

retail space • HORECA’S supply chain is still in its infancy • Skills shortage in the sector

Opportunities

• First movers’ advantage: Shaping

the market • Rich culinary history: Develop hybrid

menus • Investments in culinary training academies

Threats

• Choosing the wrong partners • Inability to attract, develop and

retain talent • Missing the train: Being late to enter

the market

Local operators continue to copy concepts