Shabu restaurants forced into price war

Bangkok Post

8 hours ago

The Thai Restaurant Association sees the price war among major shabu brands as reflecting challenges of the sluggish Thai economy, as consumers are increasingly seeking value-for-money dining choices. This price competition is also affecting small and medium-sized restaurant operators.
Last weekend, Thai media reported on the launch of Bonus Suki, a new sukiyaki brand operated by Koomkoom Co Ltd, a subsidiary of MK Restaurant Group.
The first outlet is scheduled to open in Saraburi province tomorrow, offering a suki buffet at just 219 baht per person, excluding VAT.
"If the Thai economy was in a better condition, we wouldn't see this kind of price war in the restaurant industry. But with the current sluggish economy, restaurant operators must compete on price," said Thaniwan Kulmongkol, president of the Thai Restaurant Association.
In 2024, the SET-listed MK Restaurant Group recorded revenue of 15 billion baht and a profit of more than 1.4 billion baht.
Meanwhile, BNN Restaurant Group posted revenue of 7.07 billion baht and a 1.16-billion-baht profit last year, according to the Ministry of Commerce's Department of Business Development.
Average spending per head at MK Restaurant is currently 600–700 baht, while at Suki Teenoi it stands at about 300 baht per head, Mrs Thaniwan said.
She said the rapid growth of Suki Teenoi has been driven by several factors. One key reason is its extended operating hours -- from 11am until 5am the next day -- matching the lifestyles of younger generations who tend to stay out late. These longer operating hours enable the restaurant operator to reduce the rental cost per square metre.
She added that given the current economic conditions and the rise of new competitors, MK Restaurant has launched this new budget-friendly brand to compete on price and retain its customer base.
In response, Suki Teenoi has launched a campaign across 10 branches, offering 50% off for customers dining between midnight and 5am, reducing the price to around 120 baht per person.
"Even though the restaurants may not generate much profit from this limited promotion, they gain significant media exposure and public awareness without spending on advertising," Mrs Thaniwan said.
She said intense competition from large restaurant chains is putting pressure on small and medium-sized operators, who lack economies of scale in terms of product supply.
To stand out, she said smaller operators should highlight the uniqueness of their dishes and the stories behind each dish to attract customers who are seeking a dining experience.