bodyType

customContents

entityId

entityUuid

articlePageQuery

filter

article

articleBaseAdvertisingInfoArticle

articleListArticle

articleSeoArticle

helpersCheckIsPostiesArticle

hooksArticleAcknowledgementGateOverlayArticle

hooksTrackPageViewArticle

hooksContentInterestArticle

articleLinkingDataContent

articleSchemaContent

liveArticle

advertZone

sentiment

contentLock

topics

types

sections

moreOnThisArticles

urlAlias

commentCount

sponsorType

authorLocations

authors

paywallTypes

corrections

displaySlideShow

multimediaEmbed

printHeadline

seriesContainer

socialHeadline

headline

flag

firstTopic

glossary

flattenTypeIds

publishedDate

additionalInfoBoxes

images

image

relatedLinks

relatedNewsletters

__typename

createdDate

sponsor

factSheets

series

knowledgeQuestion

disableOffPlatformContent

published

updatedDate

summary

subHeadline

body

keywords

copyrighted

customTimezone

liveContents

Kinling Lo

The Yins have a conundrum.
Regulars at their local branch of Din Tai Fung – a renowned chain of restaurants originally from Taiwan – the Beijing residents, both in their 70s, will soon have to find another option.
“My granddaughter loves the dumplings here, so we always come for lunch,” said Mrs Yin, gesturing towards the 4-year old as the family waited for a table at the national capital’s China World Mall. “We still haven’t figured out where else to take her. We are expecting a tantrum when she finds out.”
They may be out of luck. The chain’s announcement it would close all its shops in northern China – no alternate Beijing locations for the Yin family – marks the end of a 20-year engagement between the wildly popular restaurant and a consumer base once flush with discretionary income and hungry for new places to spend it.
The region’s 14 stores will be closed by October 31, the company said last week in a written statement which attributed the decision to the expiration of a business licence and disagreements over renewal. However, the 18 shops in southern China will remain open, as they are operated by a separate franchisee.
Din Tai Fung, founded in Taiwan in 1958, has built a global brand on its dumplings and beef noodles. By 2021 it had over 160 branches around the world, including the United States and United Arab Emirates. Its first mainland China outpost was established in Shanghai in 2001.

“These were times when the Chinese economy was experiencing a boom, with an expansion in international exchanges, the middle class and expat populations,” said Wei Wei, a researcher at Beijing-based think tank Anbound.
Though consumer spending as a whole has been sluggish, food and drink has been one of China’s top performing subcategories this year.
According to the National Bureau of Statistics, total spending on catering was 3 trillion yuan from January to July, increasing 7.1 per cent over the same period last year and outpacing the 3.1 per cent registered in overall consumption growth.
But this uptick has not manifested in restaurant profits.
Beijing’s statistics bureau reported overall catering revenue of 74.4 billion yuan in the first half of this year, a year-on-year decrease of 4.2 per cent. Restaurants in the capital with annual revenues of over 2 million yuan reported a total profit of 180 million yuan over the same period – a 88.8 per cent year-on-year drop that has slashed margins razor thin, as low as 0.4 per cent in some cases.
This steep decline has proven impossible to weather for many establishments. According to Chinese corporate database Tianyancha, 1.35 million food and beverage companies were registered in the first half of this year, but 1.06 million were delisted or suspended their business over the same period.


Data from Chinese food and beverage platform Hongcan 18 showed 1.36 million restaurants severed their licences in 2023, more than double the 519,000 closures reported in 2022.
“Data shows that 30 per cent of [Din Tai Fung’s] price comes from the cost of food and 30 per cent comes from labour, so they are not competitive in lowering prices,” Wei said. “When the economy is in a downturn, there is not much room to make such a transition.”
Din Tai Fung’s partial closure on the mainland does not appear to be unique – other restaurant brands from Taiwan have scaled back their operations or pulled out entirely.
Bafang Yunji, another popular chain specialising in dumplings, entered the mainland market in 2014, running 110 shops at its peak. By 2022 it had thrown in the towel, closing its last 17 outlets in the southern province of Fujian. At the time of its exit, the company pointed to indigenous competition and uncertainties regarding pandemic lockdown policies.
These brands’ struggles reflect an overall decline in Taiwanese investments, with the mainland’s Ministry of Commerce reporting a precipitous drop – from US$124.3 million in 2014 to US$70.9 million in 2023.
The correlation is less clear-cut for overseas firms. While China’s overall foreign direct investment has fallen, the performance of food and beverage companies has varied.


American coffee giant Starbucks’ sales in China fell 11 per cent during the second quarter of this year, but Burger King – a US brand which sold its China franchise rights to a Turkish company – has announced plans to open at least 200 new restaurants in the country each year.
While Din Tai Fung may only represent one of many trends in China’s food and beverage industry, Wei of Anbound said it is symbolic of a consumer market more cautious in its spending, creating more hurdles for restaurants in the upper strata of prices.
“There is an overall transition towards a lower-price market. It is therefore difficult for higher-end brands, because their customers are regular and they depend on repeat visits,” Wei said.
“However, this could just be temporary, as the company said itself that there is a problem regarding the license. When the economy is better, they could come back again.”


How big is Beijing’s war chest, and why does a headline stimulus figure remain elusive?

China’s private sector promotion legislation to add protections for entrepreneurs

4 steps China can take to revive and future-proof its economy

What are the challenges China faces on its road to economic recovery?

China's economic recovery

Northern China loses Din Tai Fung’s dumplings as consumers keep budgets under wraps

The Din Tai Fung restaurant chain has announced it will close its northern China branches by the end of October. Photo: Kylie Knott

The China World Mall branch of Din Tai Fung in Beijing. The restaurant chain will close its northern China branches by the end of October. Photo: Kinling Lo

The Yins said they take their 4-year old granddaughter to the same Din Tai Fung restaurant in Beijing at least once every two weeks. Photo: Kinling Lo

China’s embattled restaurants, embroiled in price war, struggle to stay afloat

Restaurant owners and operators acros are facing challenges to stay afloat. Phtoo: Bloomberg

Starbucks has introduced a drink set which is nearly half the price of its regular offerings. Photo: AP

China’s fine dining scene darkens as economic clouds blot out Michelin stars

Illustration: Lau Ka-kuen

A view of TRB Forbidden City, Beijing. Photo: Weibo/右之杀啦波娃

Qingxiang restaurant in Beijing, with the CCTV Tower in the background. Photo: He Yuqian

China’s humble consumers embrace down-to-earth lifestyle, rising ‘poor man’s meal’ trend

Illustration: Brian Wang

Many businesses have launched budget-friendly options known as the “poor man’s meal,” a term that has gained traction online among young adults. Photo: Xiaohongshu

Can mainland Chinese restaurants break into Hong Kong’s dining scene amid changing tastes?

Mainland restaurant chain Tai Er Chinese Sauerkraut Fish, with its signature dish Suancai Fish, or Sichuan-style fish poached in a rich broth made from fish stock and  pickled Chinese cabbage. Photo: Daniel Suen

Branch manager Wyman Zheng Huiwen of the Tai Er Chinese Sauerkraut Fish restaurant chain says the company’s localised version of its popular dish can help attract more customers. Photo: Daniel Suen

Mainland chains are selling a variety of hand-crushed lemon teas that have gained popularity in recent years. Photo: Riva Hiranand

Chinese restaurant chain Xiaocaiyuan makes another attempt to list in Hong Kong

PwC expects some 80 companies to list in Hong Kong this year, raising a total of HK$80 billion, much lower than its previous estimate of HK$100 billion. Photo: Robert Ng

A Xiaocaiyuan restaurant in mainland China. The company operates more than 600 outlets on the mainland. Photo: Bilibili

Economy

China Economy

News

China

Business

China Business

 China’s consumption downgrade: what you need to know

China’s travel industry faces reality check of ‘worst ever’ season

Visitors at the Badaling section of the Great Wall in Beijing. Photo: Bloomberg

Passengers at a waiting hall of Guiyang North Railway Station in Guiyang, southern China’s Guizhou province. Photo: Xinhua

A train attendant and passengers travelling from Pingtan in southeast China’s Fujian province to Shanghai. Photo: Xinhua

China’s ‘golden week’ consumers unwilling to shell out as hairy crab prices tumble

Chinese mitten crabs. Photo: Shutterstock Images

Crab farmers catch crabs at a hairy crab breeding base in Suqian, Jiangsu province. Photo: Future Publishing via Getty Images

Hairy crabs are often given as gifts. Photo: Weibo/Xie Zhung Yuan

China’s Mid-Autumn mooncake sales fall back to Earth as consumption fails to take off

Factory employees make mooncakes ahead of the Mid-Autumn Festival in China’s Jiangsu province. Photo: AFP

People purchase mooncakes at a shop in China’s Hebei province ahead of this week’s Mid-Autumn Festival. Photo: Getty Images

As China’s consumption picture changes, think tank argues, so must its policies

The habits of Chinese consumers have changed significantly, a think tank has argued in a recent report, creating a need for new approaches in policies to spur spending. Photo: Bloomberg

KFC, McDonald’s, Haidilao push small-store format to beat China’s consumption downgrade

Pedestrians walk past a KFC stall and outlet in Beijing. Photo: Bloomberg

People exiting from a McDonald’s restaurant in Beijing in Jaonary 2020 before the Covid-19 outbreak. Photo: AFP

From Uniqlo to Nike, global clothing brands struggle in China against ‘white labels’ amid consumption downgrade

People visiting the Uniqlo stand during the 5th China International Import Expo in Shanghai in November 2022. Photo by AFP

People walk past a Li Ning outlet in Beijing in October 2019. Photo: AFP

People chatting outside a Nike store in a shopping area of Sanlitun in Beijing in March 2021. Photo: EPA-EFE

China revenues drop for high-end hotel chains as business travel, consumer spending dip

International hotel chains have reported reduced business in China as consumers remain cautious and domestic competition intensifies. Photo: Shutterstock

International hotel chains have reported reduced business in China as consumers remain cautious and domestic competition intensifies. Photo: Handout

Starbucks loses its perk in China as spending downgrade drives drinkers to cheaper brews

Shoppers walk by a Starbucks cafe at an outdoor shopping mall in Beijing on December 23, 2023. Photo: AP

A man takes a nap at a Cotti coffee shop in Beijing on August 1, 2024. Photo: AFP

A man leaves a Luckin Coffee store in Beijing, on December 8, 2023. Photo: Reuters

Luxury brands in China take hit on low consumer confidence as economy slows

A man walks past an under-construction Louis Vuitton store at a shopping mall in Beijing on July 14, 2024. Photo: AFP

A Chow Tai Fook jewellery shop in Central seen on April 11, 2024. Photo: May Tse

Din Tai Fung, a Taiwan-based restaurant chain, will close several of its mainland China stores as customers lose appetite for pricier meals


Din Tai Fung, a Taiwan-based restaurant chain, has announced it will close several of its mainland China stores as customers appear to have lost their appetite for pricier meals.


China economy

Consumers

Taiwan economy

Food and Drinks