BEIJING, April 14, 2025 /PRNewswire/ — According to predictions, the size of China’s catering market is expected to exceed 6 trillion yuan by 2025, and the catering industry is accelerating differentiation in the competition for existing resources. The sinking markets and chain expansion in the central and western regions have become the core incremental engines, and consumer grading is driving fast food substitution and high-end “quality price ratio” transformation. The era of low profits is forcing enterprises to improve efficiency through digitization and supply chain. This article by Professor Hejiu will analyze the structural opportunities and risk boundaries for investors by combining the trends of financing contraction, technological iteration, and upgrading of healthy consumption.
Big Data Analysis of the Catering Industry in 2024
1. Market size and growth potential
In 2024, the national catering revenue reached 5.57 trillion yuan, a year-on-year increase of 5.3%, which is higher than the total retail sales of consumer goods and fully demonstrates the strong resilience of the catering industry. In the overall consumer market, the catering industry has risen against the trend and become a bright spot in economic development.
Looking ahead to 2025, the scale of the catering market is expected to exceed 6 trillion yuan. The Midwest and lower tier markets have become the main sources of incremental growth, containing enormous structural opportunities. With the rapid development of the economy in the central and western regions, residents’ consumption ability continues to improve, and the demand for catering is also increasingly strong. The sinking market, with its huge population base and gradually released consumption potential, has attracted the attention of many catering enterprises. Consumers in these regions are no longer limited to traditional local flavors in their pursuit of food, and are beginning to explore more diverse dining options, providing vast space for the development of the catering industry.
2. Chain process and competitive landscape
In 2024, the chain rate of the catering industry will increase from 15% in 2020 to 22%, which is driven by multiple core factors. The branded and standardized operating model gives chain catering enterprises significant advantages in ingredient procurement, personnel training, service quality, and other aspects, enabling them to provide consumers with a more stable and high-quality dining experience. At the same time, consumers’ awareness and trust in brands continue to increase, and they are more inclined to choose chain brand catering.
The chain rate of freshly made beverages is as high as 52%, and brands such as Luckin Coffee and Meixue Bingcheng have exceeded 10000 stores and accelerated their expansion into county-level markets. Taking Luckin Coffee as an example, it quickly gained a foothold in the market through precise market positioning, innovative product development, and efficient digital operations. Meixue Ice City is highly favored by consumers in the lower tier market due to its excellent cost-effectiveness and powerful supply chain system.
However, with nearly 8 million catering stores nationwide, competition for existing inventory has intensified. Approximately 3.02 million new stores were opened, 2.96 million were closed, and the net growth was only 64000. This indicates that the catering market has entered a relatively saturated stage, and small and medium-sized brands are facing enormous competitive pressure. In the fierce market competition, only by continuously improving one’s core competitiveness can one establish a foothold in the market.
3. Changes in consumer behavior and the contribution of food delivery
The changes in consumer behavior are particularly evident in the catering industry. Takeout has become an important part of catering consumption, with 80% of consumers ordering takeout more than twice a month, 74.3% of orders below 30 yuan, and a compound annual growth rate of over 20% for takeout. The convenience of food delivery meets the fast-paced lifestyle needs of consumers, allowing them to enjoy delicious food anytime and anywhere.
The per capita consumption center has shifted downwards, and fast food has taken over the demand for regular meals. In the fast-paced life, consumers have increasingly high demands for dining time, and fast food has become the first choice for many consumers due to its fast and convenient characteristics. High end catering has shifted towards “exquisite quality price ratio”, for example, some high-end restaurants have launched more cost-effective set meals, which not only ensure the quality of dishes but also lower the price threshold, attracting more consumers.
The underlying logic behind the demand for fast food to replace regular meals lies in the changes in consumers’ lifestyles and consumption concepts. With the acceleration of the pace of life, consumers pay more attention to time and efficiency, and fast food perfectly meets this demand. At the same time, consumers’ demand for catering has become more diversified, no longer limited to traditional meal forms.
Current situation and capital trends of catering financing in 2024
1. Financing data and analysis of hot product categories
In 2024, the financing market for the catering industry experienced a downturn, with a total of 51 financing events, a significant reduction compared to 132 in 2023, almost halving. There were only 7 billion yuan level financing transactions, a year-on-year decrease of 65%. This change reflects that capital is more cautious in investing in the catering industry, and the industry has entered a period of adjustment.
In the context of a tightening overall financing environment, areas such as tea drinks, fast food, and supply chain continue to be hot topics of capital concern. In the tea beverage market, Shanghai Auntie’s Series C financing reached 121 million yuan, and Jasmine Milk White also received nearly 100 million yuan in financing. Capital is optimistic about the development potential of sub categories such as light milk tea. In the fast food industry, regional specialty brands have emerged, such as Guangdong style jelly and Guizhou style spicy food, which have attracted the attention of capital with their unique flavors and local culture. In terms of supply chain and smart devices, companies such as Frozen Online and Coffee Technology have received investments, and smart coffee machines have become a new direction for cost reduction and efficiency improvement.
2. The transformation of capital layout logic
In the past, investment institutions placed greater emphasis on the expansion speed of catering enterprises, hoping to quickly open stores and occupy market share. However, there has been a significant shift in the investment logic of capital in 2024, with a greater focus on brand profitability and supply chain integration capabilities.
Top institutions such as Shunwei Capital, Joyful Capital, and Jue Fund continue to layout in the catering industry, but their investment strategies are more stable. They no longer blindly pursue scale, but instead conduct in-depth evaluations of the company’s profit model and sustainable development capabilities. For example, for some companies in the smart device and pre packaged food industry, capital sees their potential in improving efficiency and reducing costs in the catering industry. Smart devices can achieve automated production and management, while pre made dishes can reduce kitchen labor and food waste.
This transformation means that catering enterprises need to pay more attention to their refined operations and improve their profitability to adapt to the new requirements of capital.
Forecast of the Development Trend of the Catering Industry in 2025
1. Survival rules in the era of low profits
In 2025, the competition in the catering industry will be fierce, with internal competition becoming a trend, consumption grading, and profit margin compression becoming inevitable. Fluctuations in raw material prices, rising labor costs, and increasing rental pressures are constantly squeezing the profit margins of catering enterprises.
Faced with this dilemma, cost control and efficiency optimization have become the survival rules for catering enterprises. For example, some large chain catering enterprises reduce raw material costs through centralized procurement and establish long-term stable cooperative relationships with suppliers to obtain more favorable prices. In terms of human resources management, a flexible employment model is adopted to arrange the number of employees reasonably according to the passenger flow during different time periods, in order to improve work efficiency.
Consumption grading leads to intensified differentiation of business formats. High end catering is shifting towards a “refined quality price ratio” by improving the quality of dishes and service levels, attracting consumers who are less price sensitive but value the consumer experience. Mid to low end catering places more emphasis on cost-effectiveness to meet the daily needs of the general public. Some community fast food brands have gained a foothold in the market by optimizing their menu structure, reducing operating costs, and providing affordable and delicious meals.
2. Chain and scale acceleration
In 2025, chain brands will accelerate their store expansion and the Wandian Club will expand its capacity. Luckin Coffee has surpassed 20000 stores, becoming a typical representative of chain development. Behind the accelerated development of chain and scale, the Matthew effect is significant.
Large chain brands, with their brand influence, supply chain advantages, and standardized operations, can acquire resources at lower costs and attract more consumers. They have stronger capabilities in market promotion, product development, and talent cultivation, further expanding their market share.
In contrast, small and medium-sized brands are facing enormous pressure to shrink. They are relatively weak in brand awareness, financial strength, and supply chain integration, making it difficult for them to compete with large chain brands. Some small and medium-sized brands may close their stores due to the inability to bear high operating costs, gradually losing market share to large chain brands.
3. Technology and scenario driven innovation
Technology and scenario driven innovation have become important development trends for the catering industry in 2025. The application of digital systems in catering enterprises is becoming increasingly widespread, which can effectively reduce operating costs by 20% -30%.
The intelligent ordering system can reduce the error rate of manual ordering, improve ordering efficiency, and collect consumer ordering data to provide reference for enterprise dish research and marketing strategies. The AI inventory management system can accurately predict food demand based on historical sales data and real-time inventory situation, avoiding food waste and stockouts.
The innovation of the integrated scenario of “meal+drink” has also brought new opportunities to the catering industry. The scale of the tea and coffee track has exceeded 100 billion yuan, driving the development of composite scenes in stores. For example, some KTV themed restaurants combine dining with entertainment, providing consumers with a richer consumption experience. Camping themed stores create an outdoor camping atmosphere, allowing consumers to enjoy delicious food while feeling the breath of nature.
4. Health oriented and emotional consumption upgrade
The increasing attention of consumers to health and emotional experiences has promoted the health and emotional consumption upgrading of the catering industry.
The market penetration rate of low sugar, plant-based products is gradually increasing. 75% of consumers are concerned about food safety, and the demand for low sugar, plant-based products has surged. Some catering companies have launched healthy foods such as low sugar drinks and plant-based burgers, which have been well received by consumers.
The dining experience has shifted towards emotional resonance, and emotional healing services have a significant premium space. Naixue’s artistic stores create a unique decoration style and artistic atmosphere, providing consumers with a relaxing dining experience while feeling warmth and care.
5. The rise of sinking markets and segmented categories
In 2025, the sinking market will become an important growth point for the catering industry. The growth rate of stores in central and western cities such as Xi’an and Zhengzhou has exceeded 11%, and the county-level market has shown strong development potential.
The consumer demand in the sinking market is gradually being released, and basic necessities such as affordable buffets and community fast food have become new favorites. The affordable buffet meets the diverse dining needs of consumers with its rich variety of dishes and affordable prices. Community fast food, with its convenient location and fast service, has become the first choice for residents’ daily meals.
Segmented categories are also constantly rising. Local cuisines such as Hunan cuisine and Jiangxi stir fry have attracted numerous consumers with their unique flavors and cultural characteristics. Segmented categories such as sour soup hot pot and clay pot dishes have also emerged in the market, providing consumers with more choices. The penetration rate of affordable buffets in some communities continues to increase, becoming popular places for community residents to gather and dine.
Investment Strategy and Risk Warning for the Catering Industry in 2025
1. Investment opportunities for mature brands and specialty categories
In the field of catering investment in 2025, mature brands and specialty categories contain rich opportunities. Taking Dicos as an example, as a well-known regional brand, it has a high level of recognition and a stable customer base in the market. Dicos is gradually expanding into second and third tier cities and lower tier markets by continuously optimizing its product structure and improving service quality. Its expansion path mainly relies on brand influence and mature operating models, reducing investment risks.
Local snacks such as northwest noodles also have great potential for standardization. These local snacks attract consumers with their unique flavors and cultural heritage. With the growth of market demand, standardized production and chain operation have become possible. By unifying the procurement of ingredients, production processes, and service standards, the brand’s replicability and expansion speed can be improved.
2. Supply chain integration and layout of sinking markets
Hotpot, braised dishes and other categories have obvious advantages in supply chain integration. There are various types of hotpot ingredients, and by establishing a comprehensive supply chain system, centralized procurement and unified distribution of ingredients can be achieved, reducing procurement and logistics costs. Braised meat requires high quality and supply stability of raw materials, and a strong supply chain can ensure the quality and taste of products.
Taking frozen products online as an example, the company focuses on catering frozen product supply chain services, and achieves efficient circulation of frozen products by integrating upstream suppliers and downstream catering enterprises. Its advanced warehousing management system and cold chain logistics distribution system ensure the freshness and safety of ingredients. This supply chain integration model provides strong support for the development of categories such as hotpot and braised dishes.
Community fast food has essential attributes and broad development space in the sinking market. With the acceleration of people’s pace of life, the demand for convenient and affordable catering among community residents continues to increase. Community fast food has become the first choice for residents’ daily meals due to its close proximity to residents’ lives and affordable prices. Investing in community fast food can fully utilize the consumption potential of the sinking market and achieve stable returns.
3. Risk control and investment model optimization
Risk control is crucial in catering investment. It is recommended to adopt a small-scale trial strategy with a budget of less than 500000 yuan, and invest in individual stores for market validation first. This model can reduce investment risks while quickly understanding market demand and consumer feedback.
For emerging fields such as pre packaged meals, attention should be paid to policy risks. The development of the pre packaged food industry is greatly influenced by policies such as food safety and quality standards. Changes in policies may have adverse effects on the production and operation of enterprises.
The methodology for validating the single store model includes market research, cost accounting, profit forecasting, and other stages. In terms of market research, it is necessary to understand the local catering market demand, competition situation, and consumer preferences. Cost accounting requires accurate calculation of various costs such as raw materials, rent, labor, etc. Profit forecast should be based on market research and cost accounting results, and reasonably estimate the operating revenue and net profit of a single store. By validating the single store model, the feasibility and profitability of investment projects can be evaluated, providing a basis for subsequent investment decisions.
SOURCE Canyinj.com
