Judging from the overall situation of domestic social catering, the current urban population of more than 900 million people, according to the conservative three meals a day, the total number of "people" will exceed 2.5 billion. In the next 30 years, the scale of social catering may surpass that of family catering. How can catering merchants eat the big cake of social catering?
The author | Dong Xiaohua
Editors | peace of mind
What would happen to the world without takeout?
Recently, a young man in Pudong, Shanghai, gave the answer. Because the epidemic was closed at home, she had to cook herself, and the result was to burn two pots in three days.
For this news that makes people cry and laugh, many netizens commented that if there are conditions, professional things should still be handed over to professional people to do.
In fact, there are already a large number of people who choose to outsource cooking or catering.
According to CNNIC data, as of December 2021, the number of domestic online takeaway users reached 544 million, an increase of 125 million year-on-year, accounting for 52.7% of the total netizens.
Source: CNNIC
With the shift of young people's consumption to online takeaway, the penetration rate of food and beverage takeaway in terms of both scale and the entire catering market has increased rapidly. In 2021, the online penetration rate of catering takeaway was 19.92%, an increase of 3.02 percentage points year-on-year.
In the view of Wang Puzhong, senior vice president of Meituan and president of the home business group, with the growth of the post-90s and post-00s as the main force of consumption, the promotion of family miniaturization and social urbanization, the outsourcing of family catering demand will be the trend of the times, thus driving the scale growth of social catering.
Wang Puzhong made the above judgment in a speech at the Meituan 2022 Takeaway Industry Conference. He also predicted that in the next 30 years, the scale of social catering may exceed that of family catering.
Social catering refers to the form of dining provided by catering enterprises. The rapid rise in the scale of social catering means huge business opportunities for catering enterprises.
But now, catering operations have come to the era of "double home" with equal emphasis on takeaway and dine-in, which puts forward higher requirements for the digital awareness and ability of catering operators.
So, how should catering businesses meet the arrival of the social catering era and truly eat the cake of social catering? In the face of the rise of social catering, Meituan also hopes to find its own role.
"Ren Dun" promotion: the era of social catering is coming
Those who serve the country are based on the people, and the people are based on food and clothing. This is true both ancient and modern, Chinese and foreign.
In China, with a population of 1.4 billion, what happens if everyone outsources "food and clothing"?
In the 1990s, with the improvement of the consumption level of Chinese people, more and more people no longer use sewing machines to make their own clothes or find tailors to tailor, but choose standardized and branded ready-to-wear.
When people outsource the work of making clothes to professional clothing operators, the direct changes are: sewing machines can't sell, tailors are unemployed, but China's garment industry has risen.
A similar story is happening in the catering space. More and more people outsource cooking, and the form of dining has moved from family catering to social catering, which has directly driven the rise of the catering industry.
According to data from the National Bureau of Statistics, in 2021, the national catering revenue was 4,689.5 billion yuan, an increase of 18.64% year-on-year; accounting for 10.6% of the total retail sales of consumer goods, higher than 10.1% in the previous year.
Unlike clothing outsourcing, the rise of the restaurant industry has liberated people who cook, people who can't cook or don't want to cook, to some extent.
People can eat out (dine-in) or opt for takeout to their homes. Because of its convenience and other characteristics, takeaway is sought after by more and more consumers.
In the past five years, the market size of food and beverage takeaway has grown rapidly, from 274.1 billion yuan in 2017 to 934 billion yuan in 2021. In the same period, the penetration rate of takeaway increased from 6.9% to 19.92%.
Data source: National Bureau of Statistics, good look at business mapping
The rapid growth of the takeaway market has also spawned catering takeaway platforms such as Meituan Takeaway and Ele.me. In 2021, meituan's catering takeaway transaction volume was 702.057 billion yuan, an increase of 43.6% year-on-year; the number of catering takeaway transactions was 14.368 billion, an increase of 41.6% over 2020.
The rapid development of takeaway has also led to the rapid growth of the entire catering market. In the past five years, the size of the domestic catering market has increased from 3,964.4 billion yuan in 2017 to 4,689.5 billion yuan in 2021. For the catering industry, catering operations have entered the era of dual home for dine-in and takeaway.
Behind the rise of the takeaway market, in addition to the progress of mobile Internet, payment and other technologies, the deeper reasons are social factors such as population structure, miniaturization of family structure, and urbanization process.
The "China Takeaway Industry Development Report in 2019 and the First Half of 2020" released by the China Hotel Association and the Meituan Research Institute presents the rise of a new generation of consumers and how to accelerate the development of the takeaway industry.
It is mentioned that the young group after 90 and 00 has officially become the main force of takeaway consumption, accounting for more than 60%. Different from the post-70s and post-80s dining in the form of groups, families or multiple people, the proportion of single meals in the takeout orders of the post-90s and post-00s is 65.4% and 73.7% respectively. This form of dining is closely linked to the increase in the number of people living alone on the mainland.
In the past few decades, China's household population structure has shown a clear trend of miniaturization, with the average number of people per household falling from 3.96 in 1990 to 3.44 in 2000, 3.1 in 2010, and further to 2.62 in 2020.
Some experts believe that the average family population size will continue to decline, and the future will fluctuate at a level of about 2.5 people per household.
As the family structure becomes more and more miniaturized, the way family meals are eaten has also undergone great changes, gradually realizing the transformation from kitchen to restaurant to takeaway", and more and more families no longer cook or regard cooking as a kind of leisure and entertainment.
The advancement of urbanization has also become a long-term booster for the development of takeaway. According to Meituan's report, the proportion of takeaway consumers working in other places is increasing; at the same time, the demand for takeaway in third- and fourth-tier cities is growing rapidly.
At the end of 2021, the urbanization rate of the mainland's permanent population was 64.72%, an increase of 0.83 percentage points year-on-year. According to the calculation of the Guanghua Ideological Force Research Group, by 2035, China's urbanization rate will reach 75% to 80%, and nearly 400 million new urban residents will be added, reaching the same level in developed countries.
At present, the per capita consumption expenditure of urban residents is 2.1 times that of rural residents. With the increase of the urbanization rate, the increase in catering consumption alone is a huge market cake.
People's food and beverage consumption will also change from three meals a day to five meals a day or more. In addition to food and beverages, everything including milk, drinks, flowers and more can be taken out. For example, Meituan's prejudgment of catering and retail, "Everything Now", wants to be home.
In line with the trend of social consumption development, Wang Puzhong proposed a new indicator to measure the scale of social catering development - Rentun. It is used to measure the total number of times a user has eaten during a cycle. Three meals a day for one person corresponds to 3 people's meals; similar to the concept of the hotel industry's room night.
Correspondingly, in the past, the dining demand for a person in a day may be 3 people, but now with the increase of new scenes and new needs such as supper and afternoon tea, the number of people in a day may become 5 or more.
From the perspective of the social catering market, the current urban population of more than 900 million, according to the conservative three meals a day, the total number of people will exceed 2.5 billion.
According to model calculations, Wang Puzhong expects that in the next 30 years, that is, in 2040-2050, the number of urban social catering people may exceed the number of family catering people.
Generation Z and the silver-haired family will become the main force of takeaway consumption in the future. With the miniaturization of households and the continuous increase of urban population, catering takeaway will continue to grow and drive the rise of catering in the whole society.
Judging from historical experience and statistics, the big era of social catering is coming, which is an irreversible trend.
The Era of Dual Home: How Do Catering Merchants Win?
So far, there has been no national restaurant brand of scale and influence such as McDonald's and KFC in China.
The advent of the era of social catering will create a huge historical opportunity for local catering brands. How can catering merchants seize the opportunity to pan for gold?
Yak Road has explored some catering business logic in the era of "dine-in and takeaway" double home.
"Yak Road" focuses on Sichuan-style rice noodles, and in 2019, it opened its first store on Jianshe Road in Chengdu. At present, they have 500 stores in the country; the monthly output value of a single store is 100,000 yuan, of which online and offline account for 6:4. The monthly profit of a single store is more than 10,000.
The "Yak Road" has reached today, which is the result of continuous exploration and iteration.
Because of the epidemic, the first store of "Yak Road" was a model of pure takeaway. This small shop with an investment of more than 100,000 yuan can achieve a net profit of 50,000-60,000 yuan in a single month.
However, there are obvious problems in pure takeaway stores: first, the turnover rate of store personnel is high, and it is difficult to retain talents; second, the income is single, and if there is no systematic management of the company, the sanitary environment is difficult to monitor.
So, they made adjustments and opened a second store, "micro dine-in, heavy takeaway".
In the case of rent and labor costs unchanged, the store added 500 yuan of dine-in turnover every day, which was an increase of 15,000 yuan in one month, and the net profit earned 10,500 yuan more.
On the Meituan takeaway platform, this store also quickly became a 10,000-single store, plus dine-in income, the highest monthly profit of a single store can reach 60,000 yuan.
Niu Niu felt that this shop type still did not meet his requirements. They made a third store – "heavy dine-in, heavy takeaway".
The daily dine-in turnover of this model store can reach 3,000 yuan, 70% gross profit margin, plus 500 takeaways per day, their monthly turnover exceeded 300,000 yuan.
But the store also has a problem: because of the heavy dine-in, the store rent and labor costs have increased, so the net profit has not increased significantly compared with the second generation of stores. At the same time, there are many pain points in this store, such as the entire kitchen circulation line is in a state of chaos, and the dine-in customers have a poor dining experience.
In 2021, after Niu Niu participated in the Meituan takeaway "dine-in takeaway double home" activity, he was inspired by some and went back to make drastic adjustments to the store.
They put the kitchen of the store outside, and the rider took the meal outside, which not only formed a hot scene of the store, attracted natural traffic into the store, but also effectively solved the problem of the rider fighting with dine-in users and improved the dining experience.
This type of store rent of 13,000 yuan, daily dine-in income of 2,000 yuan, plus takeaway orders, this model has a monthly net profit of more than 60,000. For the small shop with an investment of 200,000 yuan, it is already a very good result.
However, this store type opened in white-collar business circles, and the traffic dropped significantly on weekends. Once expanding into more lower-tier cities, what about markets with fewer white-collar business districts?
Niu Niu led the team to explore the community store type - located in the community and student business districts, the kitchen is built-in, but still diverts customers from riders to ensure the dining experience. At the same time, in addition to the rice noodles, noodles, steamed buns, etc., to give customers more choices.
Niu Niu believes that today, when the epidemic is normalized, there is no simple pure takeaway shop and pure dine-in shop, which must be the double home of dine-in and takeaway. Therefore, they are not only upgrading and iterating offline stores, but also constantly exploring the tricks of online operation.
In the takeaway platform, the key to opening a store is how to quickly do traffic. When a new yak road store opens, it often uses a variety of promotional activities such as buy one get one free or "overlord meal" to attract users to place orders.
Niu Niu said that the purpose of this is very simple, that is, to increase online search, improve the transaction rate of stores, and strive for the recommendation of the platform.
With this set of traffic play methods that they have explored, the new store in Yak Road can achieve more than 10,000 takeaway orders in the same month as soon as possible.
To attract traffic, it is also necessary to retain customers and improve the repurchase rate through refined operation.
Niu Niu's experience is to take the service to the extreme. For example, when rice noodles are delivered, the soup in the meal is easy to spill. Yak Road packs all the soup in a jelly foil bag similar to one that can be sucked, which not only avoids spillage, but also the novelty of the packaging and the ritual of opening the soup packaging of the meal also become a plus point for the user experience.
"Yak Road" is just one of the fast-growing rookies in the takeaway catering industry, and many brands such as Laoxiang Chicken have grown rapidly with the help of takeaway platforms such as Meituan.
They have proved with practice that only by adhering to the new paradigm of catering operations, adopting new thinking in various aspects of constituency selection, product design, store planning, store operation, quality management, etc., and with the help of new digital tools, it is possible to grab the cake of social catering.
In this regard, the "service area" of meituan can become the starting point for the transformation and upgrading of catering businesses. Meituan's "service area" refers to the division of more than 2,800 counties and cities across the country covered by Meituan into a finer grid, clustered according to 1.4 million landmarks, and finally formed 15,000 "service areas" across the country.
In each "service area", Meituan has a localized operation team, with intelligent demand insights, all-round business empowerment and the ability to guarantee all-weather performance. Catering merchants can use the "service area" of Meituan to improve the efficiency of catering operations.
Merchants need more orders to solve their difficulties
The ongoing pandemic has hit the restaurant industry hard. At the beginning of March this year, Meituan Takeaway released six relief measures for catering merchants, aiming to help catering merchants solve their difficulties.
Meituan Takeaway's bailout measures include that, from March to December this year, for small and medium-sized merchants with operational difficulties in high-risk areas of the epidemic, the technical service fee (commission) will be halved, and the maximum of 1 yuan per order will be implemented after the halving; for other difficult merchants who have completed the transparency of the rate, they will be evaluated according to the business situation and the degree of difficulty, and the technical service fee will be capped at 5%.
At present, Meituan Takeaway is implementing corresponding measures, and the first batch of small and medium-sized merchants affected by the epidemic and business difficulties have been refunded 30 million yuan in commissions.
But platform commissions are different from rents for fixed expenses, and if there is no order, the commission cannot be talked about. Therefore, the platform "burden reduction" can only alleviate the temporary difficulties, and the more urgent needs of catering businesses are to obtain orders and revenue growth.
To this end, at this industry conference, Meituan Takeaway announced the launch of the "Prosperity Plan" for catering merchants, which will jointly build a takeaway ecology with merchants through four major mechanisms of communication, development, service and co-construction.
In the future, Meituan Takeaway will reach better communication with merchants through merchant earnest talks and bag research services. Through the new merchant support plan, the characteristic model of small and medium-sized merchants, and the quality merchant improvement project, different types of merchants can be developed.
At the same time, they will also improve the operational efficiency of merchants through methods such as merchant evaluation system and adjustment of operating subsidy rules. Through rule councils, product experience groups and other channels, merchants are allowed to participate in the formulation of rules and improve the operation experience of merchants.
Takeaway platforms and the catering industry are both prosperous and damaged. Wang Puzhong also said that only when merchants prosper, the market can prosper, riders can have income, user needs can be met, and takeaway platforms can be developed.
Obviously, in order to smoothly walk to a bright future, it is undoubtedly necessary for the platform and businesses to work together to make the big cake bigger and share it into the social catering.