Chinese F&B brands eye SEA as next battleground
60 Chinese brands opened a total of 6,100 outlets in SEA last December.
Chinese brands are eyeing Southeast Asia as the next battleground, with 60 brands opening a total of 6,100 outlets in the region since last December, more than triple the 1,800 they had in 2022, a report by Singapore-based consultancy Momentum Works revealed.
The report said that this wave of expansion reflects the challenges Chinese F&B players are facing in their domestic market. During the first half of 2024, over 1 million F&B businesses shut down, an increase of 70% from 2023.
The report said that a confluence of well-developed digital platforms, including food delivery and online discovery, expectation to scale during intense competition, as well as heightened consumer and investor expectations makes the F&B market in China both innovative and competitive.
Out-of-home F&B market in China was worth $748b in 2023, 5.6 times that of SEA, which the report calculates is worth $132.8b during that year.
A good example, is the coffee price wars, led by Starbucks and Luckin Coffee.
Albeit smaller, SEA’s F&B market remains attractive to Chinese F&B players because of its cultural and geographical proximity, as well as a ‘less’ competitive F&B market landscape.
