Restaurants' growth accelerates as mass-market outlets thrive

Customers check out food products at an international food expo in Suzhou, Jiangsu province. The China Cuisine Association said that consumption using nonpublic funds accounted for 90 percent of the total catering spending last year. [Photo provided to China Daily]

The catering industry's fortunes took a turn for the better last year, driven by strong demand for restaurants targeting mass consumers, according to an industry survey.

The China Cuisine Association said that consumption using non-public funds accounted for 90 percent of the total catering spending last year.

Industry revenue stood at 2.786 trillion yuan ($449.3 billion), up 9.7 percent, the CCA said in its report released on Monday. The growth rate was an improvement from 9 percent in 2013.

The association forecast revenue will reach 3 trillion yuan in 2015.

The survey was conducted in December involving 41,171 interviewees, mainly male consumers aged 18 to 50 who live in first- and second-tier cities or township-level regions, with a monthly income of 3,000 to 8,000 yuan.

Food safety and hygiene levels ranked higher than in previous surveys when it came to picking a restaurant. The CCA said this finding showed the huge impact of last year's OSI scandal.

Shanghai Husi Food Co, owned by OSI China (the Chinese arm of United States-based food giant OSI Group), was accused in a television report of supplying expired meat to fast-food giants, including McDonald's and Yum Brands.

Consumers have become more price-sensitive, boosting the growth of mass-market restaurants.

Many restaurants are shifting from large cities and expensive menus to smaller cities and medium-priced dishes, a trend that is more visible during festive seasons.

Zhu Danpeng, an industry researcher, said the traditional Lunar New Year's Eve dinner for this year's Spring Festival, which falls on Feb 18, is being offered at much lower prices than before and with more food choices.

He said that although most chains had launched high-end menus in a bid to maintain profits, it is medium-priced menus that are expected to draw more traffic to restaurants.

According to the survey, social occasions involving friends and families, as well as dating, are still the main reasons people go to restaurants.

Business meals have been cut back amid the government's anti-corruption campaign. That has been especially true for high-end restaurants that depended on customers using public funds.

Other findings of the survey:

· Consumers have "very limited tolerance" in terms of waiting for their orders to arrive. Less than 10 percent of interviewees said they could wait between 20 and 30 minutes. Commitments to cut waiting times are being offered by many restaurants.

· Restaurant choices are most influenced by word-of-mouth reviews, which are ranked ahead of third-party review websites. The impact of newspapers and broadcasting outlets has continued to weaken.

· Delivery services have emerged rapidly, especially those based online, even though the sheer number of users remains small. This trend is creating challenges in food safety among third-party food delivery providers.