The county’s economy is rising, and catering brands are hunting for “small town consumers”?

Wen| Chopsticks Playing Thinking Wang Yingli

In the past two years, the county catering market has gone against the national market and shown an unprecedented prosperity, which has had to be noticed by us.

Taking the recent data during the Spring Festival in 2024, the county’s catering consumption has grown significantly, with dine-in food and leisure and entertainment consumption increasing by 24.9% and 35% respectively year-on-year, which is higher than the national average. In the past, it may be attributed to the return home effect of the Spring Festival, but this time, it will also add to the popularity of local intangible cultural heritage tourism, movie entertainment activities, etc.

From the perspective of daily consumption, unlike the high degree of involution in large cities, the county’s economic atmosphere is more relaxed and more suitable for catering and entertainment consumption, and consumer needs are diversified, which is obviously very suitable for new and old catering brands to make gold in the future.

According to Chopsticks Play Thinking (www.kwthink.cn), due to the highly developed Internet and transportation, today’s young people in small towns are no longer the stereotyped information block, aesthetic stagnation, and outdated taste. They and the main consumer groups in first-tier cities have similar consumer preferences and high requirements, and their purchase frequency and consumption power are actually comparable to those of first-tier and second-tier cities.

New opportunities have long been known and have been laid out. Now, when we look at it, it is necessary to use an in-depth dry article to sort out how this explosive growth of the county economy has stirred up the entire catering industry.

From incremental carnival to stock game to new world gold mining”

With the rise of county tourism, tourists from all over the country flock to the county during holidays. Whether it is a reverse tour from the high-line city to the low-line city or a weekend trip by locals, everyone will look for delicious food hidden in the streets and alleys.

Tourists from cities are no longer satisfied with the same chain restaurants in big cities, but prefer to taste authentic county snacks and experience the original local culture. This has made the county’s catering industry usher in unprecedented prosperity during the holidays., especially some landmark restaurants and local online celebrity shops.

In contrast, for catering brands that are crowded in large and medium-sized cities, the market incremental carnival in large cities has long ended. Now that the stock game is exhausting, the county has unknowingly become a rare new continent.

Judging from the county’s population structure and consumption potential, the permanent population of China’s county market reaches 748 million, accounting for 38% of the country’s total population, and the growth rate of per capita consumption expenditure of rural residents (6.5%) is higher than that of urban residents (5.0%)59. The QuestMobile report shows that 80.4% of young and middle-aged people(under 40 years old) in small towns in third-tier cities and below account for an average monthly online consumption of more than 1000 yuan, becoming the main force in consumption upgrades.

The competitive advantage of sinking markets is already very obvious. Commercial rents and labor costs in low-tier cities are only 1/3 and 1/5 of those in first-tier cities, which provides profit margins for brands.

Taking the new tea and beverage industry as a reference, Guming has deployed 80% of its stores in cities below second-tier through the strategy of surrounding cities by towns. In 2024, the proportion of township stores will increase to 40%. Guming reduces costs through the scale effect of fresh fruit procurement.

During the Spring Festival of 2025, county tea and beverage takeout orders increased by 65% year-on-year, and sales in stores in non-first-tier cities such as Xiaogan and Fuyang increased by more than 400%. The average daily sales of Bawang Tea Lady in Jieyang, Guangdong, Changzhi, Shanxi and other places exceeded 3000 cups, which confirms the strong driving force of returning people and tourists to the sinking market.

If we look deeper, this emerging market of the county economy can actually be understood as the result of the accelerated urbanization process of the county, and the consumption potential of the sinking market is further released. Data shows that the growth rate of national catering revenue in the first half of 2024 was 7.9%, while the sinking market maintained a rise of more than 8%. This shows that the sinking market has become an important battlefield for catering brands.

At this critical moment, following the trend is the most critical thing. According to incomplete statistics, in 2024, more than 15,000 chain catering brands will sink into the market, relying on people-friendly prices and open franchise models to achieve rapid expansion.

What are the consumption characteristics of the county market?

What are the differences between consumers in sinking markets, mainly counties, and consumers in high-line cities? This may be the core of understanding this consumer spree.

Consumers in the county area have low mortgage pressure, stable jobs, and abundant leisure time, showing a rich and leisure life. Unlike the stereotype, they actually have relatively high spending power, rationality and openness.“”

There is such a hot search during the Spring Festival. A blogger who drifted back to his hometown in Jiangxi Province posted a video titled “The county is really rich. I laughed at being poor when I came home during the New Year”, telling his experience of being shocked by the consumption upgrade of a small county in Jiangxi Province.

Old classmates in the county drive BMW, and he drifts north to squeeze the subway in winter. I couldn’t buy good clothes for one or two hundred yuan in the county, so I wore a knitted sweater that I bought at a discount of 45 yuan on Taobao.

As you can see in this video, the county is copying the city. Catering and snack chain brands such as Xicha, Ruixing, and Zhao Yiming have long been used to in the county. Script killing, cooking tea around the stove, and even golf have long become the most fashionable activities in the county. With the enrichment of consumption models, the county’s consumption format is more convenient and constantly upgrading.

Because the household savings rate in the county is relatively high, nearly 60% of the homeowners do not have a mortgage, which further enhances their spending power. There is still a considerable number of people who are within the system and consume more boldly. Young people in the town, small town mothers and small town aunts are the main consumer groups in the county. 4J cherries can be bought if they want; there are no discounts or discounts in the county gold shop, and customers are still endless; Sam, Master Bao, and Hollyland purchasing can add a price of 20 yuan per cake, and there are still piles of people who buy it; the number of cafes in the county is increasing rapidly, and the growth rate is much faster than that in a super-large city.

It is estimated that by 2030, more than 66% of China’s personal consumption growth will come from sinking markets. This means that the sinking market will continue to be an important growth point for catering brands.

As a result, catering brands have accelerated their sinking, and catering, leisure and entertainment formats have been rapidly upgraded while continuing to enrich: the county has opened foreign fast food such as KFC, McDonald’s and Pizza Hut; Xicha, Naixue and Ruixing have sunk to the county and ordered takeout. Delivery; popular selfie shops, Live House and camping tent camps in first-tier cities have also been opened in the county.

According to data, Yum China, the parent company of KFC and Pizza Hut, accounted for nearly half of the total store number in third-to sixth-tier cities in the first half of 2023. The number of stores in third-tier cities and below will account for 38.78% in 2023, exceeding the number of stores in first-tier, new first-tier and second-tier cities.

At the same time, many young entrepreneurs have begun to break ground in the county to dig gold. They can better understand the mentality of local young people who are eager to achieve equal consumption rights with first-tier cities and hope to create new business formats from all aspects.

The county is accelerating its efforts to bridge the business gap with large cities. Many young people who have drifted away have seen new opportunities to start businesses and have begun to return home to start businesses and find jobs at home. There are not only bosses who have returned to their hometowns to create a generation, but also takeout riders who have more than double the local average salary level and waiters who earn two to three hundred a day. Wealth gathers and people gathers, and improved infrastructure brings opportunities and a high-quality business environment to the catering and entertainment industry, thereby jointly promoting the sustainable development of the county economy.

How do various brands respond?

Returning to my hometown county after returning from Shanghai, there is actually a shopping center in the small county. There, you can not only drink ancient tea and Mixue Ice City, but also eat KFC, Xiaolongkan and Xianhezhuang. You can also visit famous premium products, Decathlon and Hailan Home. This situation is becoming increasingly nothing new.

From a consumer’s perspective, catering brands that were previously only seen in large cities can now be owned by more and more small counties; from a brand perspective, huge opportunities are seen. The county market seems to be small and has a small population. However, the consumer demand behind it cannot be ignored, so we began to accelerate the reduction of dimensions.

2018 is an important year. This year, the sinking market has begun to become a prominent and hot spot. It seems that overnight, major catering brand stores have opened to county-level markets, and the sinking speed is astonishing.

The county’s catering industry is almost constantly being occupied by chain brands, and the county’s commerce is polarized. On the one hand, the county is still dominated by individual small shops operated independently by couples. On the other hand, many first-line brands and local catering brands have sunk and become young people. The preferred place for consumption.

Tea drinks are the first wave. Joining chain tea drinks brands such as Mixue Bingcheng, Guming, Chabaidao, and Shuyi Shaoxiangcao have begun to appear in the center of the county and have begun to replace the county’s own brands. Immediately afterwards, chain restaurants (such as chain hot pot brands such as Xiaolongkan, Tan Yaxue, and Xianhezhuang that have become popular in first-tier cities through marketing) began to appear in county-level cities. These hot pot brands basically expand through chain franchises, and most of them are small bosses with slight financial strength in the county to join and open stores.

At the same time, the barbecue category performed well. Jiutian Family and Hangongyan barbecue brands are expanding rapidly in the county and making money. Jiutian Family has opened more than 900 stores across the country, and Hangongyan has more than 300 stores. The market size of stores.

In the past, only Wallace and Dicos would eat fried chicken burgers in the county. In the past two years, KFC has put down its dignity to embrace the sinking market. To this end, it has also opened a small-town model preferred store to pilot it in the county. Compared with traditional KFC stores, the preferred stores have made some changes. The store area is smaller, the main products have been deleted and drainage products that adapt to the low prices of the county have been added.

The first county king Mixue Ice City was born in the market environment of the county and knew well the county consumers ‘pursuit of cost performance; now brands such as Micun Bibimbap and Tianla are expanding very rapidly in the county market, adding hundreds of new stores in just half a year.

During this period, the inclusive effect of digital infrastructure was also quite obvious. Most leading brands adopt online drainage, private domain precipitation and offline repurchase models to improve efficiency; the average exposure conversion rate of brands on take-out platforms is three times higher than that of traditional stores. Meituan data shows that Yunnan’s summer catering online orders will increase by 14.9% in 2024, and county merchants will achieve low barriers to reaching customers across the region through the platform.

On the other hand, local catering brands in the county are also making efforts. Especially in the context of the food economy derived from the integration of culture and tourism, the rise of county catering and the deep integration of culture and tourism, the average total tourism revenue of 1866 counties across the country in 2023 will be 4.295 billion yuan, a year-on-year increase of 41.19%, and the average number of tourists received The number was 5.0827 million, a year-on-year increase of 35.18%.

County-specific restaurants such as Jingdezhen Sanbao Courtyard and Yiwu Bedi Restaurant rely on local cultural IP and tourism resources to attract customers. During the Dragon Boat Festival in 2024, the county-level catering order volume will increase by more than 30% year-on-year compared with last year.“”“” Yunnan and other provinces rich in tourism resources have turned seasonal ingredients into long-term consumption hotspots with the help of local delicacies such as Funzi Banquets and Four Yunnan Cuisine.“”“”

conclusion

“If the county is governed, the world will be safe, and if the county is strong, the country will be rich. According to relevant data, more than 2800 county-level administrative divisions across the country occupy nearly 9 million square kilometers of land, more than 90% of the country’s land area, and the county population exceeds 900 million. People, accounting for about 70% of the country’s total population. The income ratio of urban and rural residents has dropped from 2.88 in 2012 to 2.45 in 2023. The consumption power of young and middle-aged people in the town cannot be underestimated. The beginning of the golden decade of county catering has just begun.

However, after research on chopsticks play thinking, it was found that competition in the county catering market has also begun to appear. The competition between brands is not only reflected in price, but also in service, quality and innovation. How to stand out in the fierce market competition will This will be an important challenge for major catering brands.

In the future, brands need to seek a balance between cost-effective advantages and quality improvement, and county residents may be the largest food and clothing providers in the future. This consumption revolution that started in the county may reshape the overall pattern of China’s catering industry.