Hong Kong diners are choosing value over luxury, says top restaurateur

Hong Kong restaurant goers are turning away from luxury dining experiences to focus on more affordable options, according to the head of a leading local restaurant group.

Syed Asim Hussain, the founder of Black Sheep Restaurants, says sales at the F&B group’s casual and premium properties – defined by per-head expenditure of around US$50 and US$100 respectively – have risen by 30 percent year-to-date. By contrast, the group’s luxury tier, with average per-head expenditure of US$200, is falling behind.

Speaking on Bloomberg’s China Show on 31 August 2026, Hussain, whose company owns 48 restaurants in the SAR, said diners were now looking for “affordable, repeatable experiences.”

[See more: Hong Kong’s biggest F&B trade show returns with retail crossover]

He added that Black Sheep was currently trying to answer the needs of guests seeking value-driven meals but doing so was being made difficult by the increased price of goods and staple ingredients, which Hussain noted had grown by 25 percent over the past five years. He said that these higher expenses could not be entirely passed on to consumers. 

The restaurateur also observed that people were drinking less alcohol. Black Sheep’s wine and spirits sales fell from 35 percent of total sales in 2016 to less than 24 percent as of August 2026. Hong Kong government data echoes the figures, with local bars reporting a 4 percent year-on-year decrease in sales in the first quarter of 2026. 

Why is Hong Kong’s restaurant industry struggling in 2026?

Hussain remarked that the restaurant sector, both locally and globally, had “changed significantly” to the extent that “the industry today would look unrecognisable to someone operating in 2016.”

Besides inflation and higher costs, the main changes lay in consumer preferences he said, with a much higher bar now being set when it came to convincing people to dine in a restaurant. 

“Good restaurants have to create their own demand,” he said, but cautioned “In some ways, there’s no real momentum for us to surf on,”

The Black Sheep founder noted that the group had to shut down restaurants it had been operating for a decade, as it could no longer “afford anymore to be precious about keeping restaurants open.” 

Despite the challenges, Black Sheep is expecting sales in Hong Kong in 2026 to rise by 18 percent year-on-year, according to company figures reported by Bloomberg.

Where is Black Sheep opening new restaurants?

Black Sheep is looking to expand beyond Hong Kong, with Hussain noting that his group has ten restaurant openings planned over the next 2.5 years, including three in the Middle East. Although the entrepreneur admitted that it had been a “difficult” past year in the Middle East, he also stressed that the region was “not a broken thesis,” with his company remaining “committed” to the market.

On Black Sheep’s Singapore operations, Hussain described its operating margins in the country as “tremendous.” He added that Singapore had been very receptive to his company, which was looking to expand the number of restaurants in the country from two to five by the end of 2026.