China’s fast food restaurant boom is continuing as changing lifestyles and growing western influences see a continuing move away from traditional eateries.
A new report by industry research house IBISWorld estimates nearly 2 million fast food outlets will be operational in China by year’s end with consumer spending on the category up by 16 per cent on 2010. That equates to a US$74.8 billion market.
After nearly a decade of strong revenue growth, the Fast-Food Restaurant industry in China shows no signs of stopping. While the growth rate will ease slightly, IBISWorld predicts an annualised 14.5 per cent growth rate will continue until 2016 when the sector will be worth $147 billion.
But growth in the number of Chinese enterprises is expected to slow considerably, due to increasing competition and expected saturation in the most developed markets.
“Lifestyle changes and reduced leisure time have contributed to consumers shifting from eating in traditional full-service restaurants toward eating in fast-food restaurants,” the report concludes.
“Increased Western influences in China and higher incomes have seen increased demand for fast-food. Western-style fast-food outlets are growing much faster than Chinese-style outlets, in terms of operating revenue and network establishment numbers.”
With the rapid development of fast-food service providers and new brands and food styles, industry growth has been strong for a whole decade.
IBISWorld estimates fast-food restaurants will spend an estimated $11.5 billion in wages in 2011.
The nearly 2 million establishments operating in the industry by the end of the year will include franchise and chain operators of all sizes and independent Chinese-style fast-food facilities throughout the country.
Last year, China’s economy gradually recovered from the global recession and food prices increased rapidly under the rising inflationary level, resulting in revenue growth of 17 per cent in the fast food sector.
