The US chicken fried company Popeyes is making an effort to expand into China. It plans to launch 1,700 outlets throughout China over the next decade, taking on a number of well-established competitors such as KFC as well as McDonald’s.
The aggressive growth strategy is a result of a sister business that has an experienced mainland team and a well-tuned store development tool that was made the sole owner of the restaurant in Louisiana. Brand.
It also shows the growing interest of international fast-food businesses to capture an enticing slice of the huge Chinese market for consumers after China emerged from its oppressive Covid-19 government earlier this year.
“China remains a very important market for the brand to expand its presence,” Jason Ge, general manager of Popeyes China, told reporters at a press conference on Wednesday. “We want to bring people who share the same interests with our restaurants. We want our customers to be delighted with our cuisine, design and the music.”
Popeyes reopened its store in the busy Middle Huaihai Road in Shanghai on Saturday, only four months after closing all of its stores in China after a massive change in its business model. This fast-food chain first opened its doors on the scene in China just three years ago with a lot of excitement.
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A plethora of customers were waiting in lines for as long as eight hours to taste the signature Fried Chicken at the grand opening ceremony of Popeyes’ Shanghai store in May 2020.
Tim Hortons China – known simply as Tims in the market of mainland China is the operator of Tim Hortons China, a Canadian bakery and cafe chain that has established more than 600 outlets in China. It took over Popeyes China in March as it sought to grow its business by a significant amount for both brands.
Tims is a joint venture of Private equity firms Cartesian Capital Group and Restaurant Brands International, which is the owner of Tim Hortons, Burger King, and Popeyes.
Popeyes hopes to open ten stores in Shanghai next year. And to increase the number to 70 by 2024.
In 2025, it plans to expand its reach by adding around 100 stores as it expands its geographical coverage to include over a dozen cities on the mainland.
The company plans to operate 500 outlets across the continent within five years, out of which 180 franchise stores will be opened.
Popeyes currently has 4,100 outlets across the globe.
Lu Yongchen, chief executive of Tims China, told reporters that the two brands would collaborate to grow the business on the mainland as they build their supply chains imp,lement their digitalization strategy, and increase the brand’s image.
“The reopening of China’s economy [after the pandemic] heightened global fast-food giants’ hopes that they can regain growth momentum in the world’s largest consumer market,” said Chen Xiao, chief executive of Shanghai Yacheng Culture, a brand and marketing firm.
“Restaurant businesses appeared to recover quickly in cities like Shanghai, although it will still take time to revive the country’s stalled economy.”
In Shanghai, the amount of money spent on dining out and hotels was up 42 percent over the previous year to 19.36 billion Yuan (US$2.66 billion) in the first quarter of 2023. This was compared to a 9.7 percent growth in the local gross domestic product over the same time.
According to data provider YuboZhiye Information Technology, the scale of China’s fast food market is expected to reach 1.5 trillion yuan by 2024, which is up 70% percent from the total revenue of 89 billion yuan in 2017.
Yum China Holdings, which is the owner of KFC and Pizza Hut, the Pizza Hut restaurant chains in China mainland China and Taiwan, plans to spend $900 million to open an additional 1100 to 1300 outlets this year, its head of finance, Andy Yeung said in February.
Tims China said in a statement issued in March that Popeyes China has US$30 million of cash available to expand its business in China as well as announcing that it will allocate an additional 60 million to build business for the brand of fried chicken in the world’s biggest market for consumers.