Determinants of Malaysian Household Expenditures on Food-Away-From-Home

The censored Tobit model is applied on data from the Malaysian Household Expenditure Survey (1998/99) to identify socio-demographic determinants of household expenditures on food-away-from-home (FAFH). Results indicate that Chinese, urban residents, and those with higher monthly household income spend significantly more on FAFH expenditures than their non-Chinese, rural, and lower household income cohorts, ceteris paribus. Other results obtained suggest that age of household head, gender, education level and household size do not significantly affect household expenditures on FAFH. Based on the above findings, several observations are noted. First, the current range of menus being served can be further diversified in order to attract those with religious and other diet restrictions. Opportunities exist to expand the range of FAFH to tap into the 'Halal' food market. Second, to further penetrate the FAFH market, efforts should be made to reach out to those staying in the rural areas that may not have access to advertising and marketing campaigns. Publicity campaigns in the form of regional radio and newspaper advertisements would be most effective in penetrating these areas. Third, mid-level FAFH establishments should consider appropriate pricing strategies to attract consumers from all income levels. Lastly, the Malaysian FAFH market appears to be continuing on its upward trend although there exists no significant differences between the old-young, male-female, higher-lower educated, or large-small family size in determining the amount of money spent on eating out.