In 2017, there were more than six million foodservice outlets in China, most of which were full-service restaurants. Chain operation had become the fastest expanding business model for the catering industry in the country. In 2018, the revenue generated from catering chain stores reached 195 billion yuan. Yum China is one of the largest national full-service restaurant operators in China with over 8,000 outlets. 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 catering brands are also sharing this fast-growing market. In 1987, the first KFC restaurant in China was opened near Tian’anmen square in Beijing. After 40 years, KFC had over 6,500 restaurants in China and is still expanding. Foreign café brands like Starbucks are gaining 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.
With the advanced development of online-to-offline (O2O) services, catering services are becoming more closely connected with the Internet. 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 had been booming because of low logistic 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.