Tier-II cities in India emerging growth hubs for restaurants, dining out becoming lifestyle among Gen Z: Report

TierII cities in India are fast emerging as the next growth frontier for restaurants as dining out is no longer an occasional indulgence but is becoming a lifestyle especially among Gen Z according to a report by Grant Thornton BharatThe report noted that rising consumer spending favourable cost structures and better infrastructure are making TierII cities an attractive alternative to metrosIt stated TierII cities are fast emerging as the next growth frontier for restaurantsHowever it added that winning in these markets requires more than ambition and calls for careful format choices operational discipline and a longterm viewThe report data highlighted a substantial shift in consumer behaviour in TierII cities Dining out which was once an occasional indulgence is now part of everyday lifestyle choices for Gen Z and millennials who make up a significant portion of the consumer baseWith average monthly incomes nearing metro levels consumers are increasingly open to experimenting with new cuisines and formatsThe report further pointed out that digital engagement is also on the rise in TierII cities Over 72 per cent of consumers are receptive to foreign recipes while 33 per cent follow food and beverage brands onlineThis reflects a growing appetite for branded experiences and a readiness to engage with differentiated offeringsOn the economic side the report highlighted that average monthly incomes in TierII cities are approaching metro levels resulting in higher diningout spendsAt the same time commercial leases are significantly cheaper at INR 200250 per square foot compared to INR 18002200 per square foot in metro cities This enables operators to enter new markets with lower capital investmentThe report also shared that TierII cities are emerging as cultural and economic hubs with pilgrimage tourism acting as a key growth driverCities such as Prayagraj Varanasi Puri and Shirdi are witnessing higher footfall not only from devotees but also from investors and hospitality brands responding to the need for structured and reliable experiencesThe report also shared strategic recommendations for restaurant operators It includes calibrated growth with local intelligence building consumer loyalty through local resonance and brand aspiration designing for operational efficiency and longterm viability elevating talent to drive consistency building scalable supply chains and using AI for operational intelligenceAccording to the survey 94 per cent of respondents plan to expand within their current TierII city or into other TierII and TierIII markets signalling that the next wave of growth for Indias restaurant sector is unfolding beyond metrosThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever