Food services in China - statistics & facts
The Chinese food service market has been hit hard by the coronavirus pandemic, with total market revenue dropping by more than 15 percent to 3.95 trillion yuan in 2020 (around 560 billion U.S. dollars). However, Covid-19 has also accelerated the restructuring of the industry and the development of new business models. Online food delivery has grown strongly against the general market trend and the growth of chain stores has been gaining momentum. Total food service market revenue has reached new all-time highs in 2023.
In addition to dominant Chinese cuisines, foreign food service brands are also sharing this fast-growing market. In 1987, the first KFC restaurant in China was opened near Tian’anmen square in Beijing. As of 2023, KFC had more than 10,000 restaurants in China and is still expanding. Foreign café brands like Starbucks have gained immense popularity in China, although drinking coffee does not belong to the traditional Chinese lifestyle. Besides, Japanese cuisine is particularly popular among the Chinese younger generations, and Ajisen China is one of the beloved Japanese casual dining style brands.
Driven by rising disposable income and increasing demand for diverse dining options, China's food service market has strong growth prospects. Digitalization and online food delivery platforms are also boosting market expansion, especially among younger consumers. However, common challenges such as possible regulatory changes and supply chain disruptions may impact growth, requiring adaptability from market players. Overall, the sector is expected to continue its robust development in the coming years.
Booming online services
With the advanced development of online-to-offline (O2O) services, food services have become more closely connected with the internet. In 2023, a record number of 545 million people used online food delivery in China. Instead of paying with cash, consumers can easily pay by scanning the QR code in restaurants and street food hawkers as well. Diners can read the menu and order the food through the restaurant apps while they are waiting for a table online. Food delivery services did not only boom thanks to the pandemic, but also because of low logistic costs and a decreasing interest in cooking at home. Besides consumer behavior changes, more and more catering providers utilize a smart management system based on big data, which help them better understand consumers’ preferences and make changes accordingly.Growing chain restaurant market
Chain operation had become the fastest expanding business model for the food service industry in the country. In 2022, the revenue generated from larger catering chain stores amounted to 233 billion yuan. Yum China is one of the largest national full-service restaurant operators in China with nearly 15,000 outlets in 2023. It is the parent company of KFC, Pizza Hut, Taco Bell operated in the country, as well as all East Dawning and Little Sheep restaurants. Other prominent local players include the time-honored brand Quanjude, which is famous for its Beijing roast duck, hot pot chains like Haidilao and its imminent rival Xiabu Xiabu. After its huge success in China, Haidilao opened its first restaurant in London in April 2019, which attracted long queues of enthusiastic diners.In addition to dominant Chinese cuisines, foreign food service brands are also sharing this fast-growing market. In 1987, the first KFC restaurant in China was opened near Tian’anmen square in Beijing. As of 2023, KFC had more than 10,000 restaurants in China and is still expanding. Foreign café brands like Starbucks have gained immense popularity in China, although drinking coffee does not belong to the traditional Chinese lifestyle. Besides, Japanese cuisine is particularly popular among the Chinese younger generations, and Ajisen China is one of the beloved Japanese casual dining style brands.
Driven by rising disposable income and increasing demand for diverse dining options, China's food service market has strong growth prospects. Digitalization and online food delivery platforms are also boosting market expansion, especially among younger consumers. However, common challenges such as possible regulatory changes and supply chain disruptions may impact growth, requiring adaptability from market players. Overall, the sector is expected to continue its robust development in the coming years.
