Thai food fight: Restaurant industry left starving as spending drops 40%
Thailand’s restaurant industry is in turmoil, with purchasing power dropping by over 40% in the first quarter of 2025, according to Thanivarn Kulmongkol, President of the Thai Restaurant Association.
The sluggish economic recovery and stagnant incomes have left consumers tightening their belts, opting for savings rather than spending, especially ahead of major festivals like Songkran.
This downturn is affecting all types of food outlets, from standalone restaurants to food stalls in shopping centres. Meals priced over 80 baht are struggling to attract customers, forcing restaurants to slash prices to 40-50 baht per dish to remain competitive.
The surge in competition from Chinese-owned zero-dollar restaurants offering cheap meals is also intensifying the strain on local businesses. With the food market valued at an estimated 700 billion baht, many establishments are facing the harsh reality of opening and closing each year based on their ability to stay afloat in a challenging environment.
Despite the gloom, there is some hope that the upcoming Songkran festival, when many people return to their hometowns, will help to revive the market.
The annual event has traditionally brought a boost in sales as people gather to celebrate, eat, and spend. In addition, the government’s third phase of digital currency distribution, worth 10,000 baht, has been proposed to aid young people aged 16-20.
The government is keen to implement this scheme quickly, and there are ongoing discussions about whether restaurants will take part.
However, there are concerns about the digital nature of the currency. As the scheme does not involve cash transactions, it remains uncertain whether restaurants will fully embrace it, particularly when many rely on cash payments.
If successful, the scheme could provide a much-needed influx of spending, but it’s still unclear whether this will be enough to sustain the restaurant industry in the long run, reported KhaoSod.
For now, Thai restaurants are left navigating a tough landscape, with hopes pinned on Songkran and digital currency as potential lifelines. But will these efforts be enough to turn the tide on the decline? Only time will tell.
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