Brazil has officially fallen into recession and unemployment rates are rising again. But even with money getting short for Brazilian consumers, it seems there is no crisis for the fast food and casual dining sector.
American brands still look to Brazil as a massive business opportunity. In 2014, McDonald’s had increased options on their ‘saver menu’ with the purpose of maintaining market share in the country – Brazil is their 7th biggest market in the world. and they plan to focus on small/ medium towns in other parts of the country, like the North-eastern region. McDonald’s succeeded to build a much better brand image in Brazil that is far cry from their reputation in the US.
Subway, which is the country’s leader in number of stores (1871 in 2014), has been investing hard in special offers like “Barato do dia” (Sub of the Day) and “Baratissimo” (loosely translated as ‘Super Cheap’), to cater for those that felt the squeeze in their wallets.
After closing its stores ten year ago, Dunkin Donuts recently returned to Brazil. The chain will not only bring their trademark donuts but also a wider menu choice with hot and cold coffees, croissants, bagels and sandwiches – in addition, they will have exclusive donut flavours adapted to Brazilian taste like doce de leite, passion fruit and coconut. Its first store in Brasilia has had queues since it opened in May this year. In Brasilia, Daiana Kmiecik, 27, standing in line in a recent afternoon said, “It’s my third time here, but they ran out of donuts from the other two times – I think I’ll buy a 12 donut box this time.”
Casual dining: a winning concept
Not only the fast food sector is thriving. The American casual dining restaurants are also getting their fair share from the “hungry” Brazilians’ money. In May this year, the Italian inspired Olive Garden and sea food restaurant Red Lobster arrived in Brazil. Applebees’s already has 15 stores and the burger chain Johnny Rockets has already nine restaurants and plans to open another three this year.
Outback Steakhouse – present in Brazil since the late 90’s – already has 64 restaurants and is planning to open another 12 in 2015. Outback restaurants are so popular that the average wait for a table is around 1 hour and queues of over 50 people at the door, but the restaurant fans don’t get put off by them – in fact, some have become regulars, having lunch at least 2 to 3 times a week. New openings are very much anticipated and celebrated by food bloggers – like the new restaurant in Rio Preto, in the state of Sao Paulo.
It seems that Brazilians have developed a taste for American restaurant chains, partly because of the increasing number of Brazilians travelling to North America for holidays. The US is the main destination for Brazilians going abroad – especially to Orlando, Florida. Leading the way are Brazilian teens, for whom a trip to Orlando has become almost a rite of passage. In 2014 there were about 2.3 million visiting the US, more than three times the total of 2007, according to US government data.
Back in Brazil, mother Elisama Lorenzo, 42, says her children like how American-style eating places are different and unique. They recently have been eating burgers in the new Johnny Rockets store at a mall in São Paulo, where the waiting time at lunch is up to 90mins. “I come to American places because my kids insist”, she says.
If the recession is bound to last it remains to be seen. Today, a third (33%) of what Brazilian spend with food are in restaurants, according to the survey from GS&MD. By 2020 will reach 40%. The casual dining is a winning concept among consumers in different income levels: consumers from the classes A and B like eating in these places to break the everyday routine. For the class C, it’s an alternative for special occasions.