• Alazan

High-end restaurants vs. QSRs: which one is leading growth charts in China?

Updated: Jun 6, 2019

Chinese consumers used to perceive Western food as high-end and expensive dining options, often reserved for special occasions. When KFC, the first US chain to open a restaurant in China, started operating in Beijing in 1978, customers had to wait in line for over an hour to get their hands on the colonel’s fried chicken. However, the long wait times were the least mind-blowing fact about this American quick service restaurant. Local Chinese consumers considered the restaurant as such an upper-echelon establishment that couples held their wedding ceremonies and receptions in its dining room!

The grand opening of the first KFC store in China

Fast forward over 40 years, we find China with a significantly more educated and sophisticated population. Today’s Chinese consumers put emphasis on the value for their money when choosing to eat a meal at Western quick service restaurants.

According to China-Zhiku, both the consumption per capita and the traffic at high-end Western restaurants (defined as locations with an average meal price greater than US$30) decreased more than 10% in 2017. That same year, the traffic at middle-end Western restaurants (defined as locations with an average meal price between US$12 and US$15) decreased 2.3%, but consumption per capita increased by 12.8%. Conversely, the QSR and fast casual segments (defined as locations with an average meal price between US$5 and US$7) experienced remarkable growth in 2017, with an increase of 35.6% in number of consumers and of 12.3% in consumption per capita.

What are the reasons behind this exponential growth in these QSR and fast casual sectors as the average Chinese household enjoys more disposable income every year? Contact us to get more insights on this phenomenon and on other paradigm shifts that make China the perfect host for an American restaurant brand.

About Alazan

We are a group of restaurant and retail industry experts who embrace innovation, diversity, and growth. We empower foodservice enterprises to expand their global operation in China by leveraging our industry expertise, up-to-date insights, and strong national network of restauranteurs, real estate companies, supply chain partners, investors, and educational institutions.

32 views0 comments