The Rise of Chinese Food and Beverage Brands in Southeast Asia

A New Era of Culinary Influence

In recent years, Chinese food and beverage (F&B) brands have been making waves across Southeast Asia, offering affordable and appealing alternatives to long-dominant American chains like Starbucks and McDonald’s. At the forefront of this trend is the Mixue Group, a Chinese beverage giant that has surpassed these global giants in terms of the sheer number of outlets worldwide. The brand, whose name translates to “Honey Snow Ice City,” has capitalized on the region’s sweet tooth by offering a wide range of affordable and delicious products, including ice cream, coffee, and bubble tea. Mixue’s rapid expansion has been nothing short of remarkable, with over 45,000 stores globally as of September, more than 40,000 of which are located in China alone.

The brand’s success is evident even on social media platforms like TikTok, where jokes about Mixue’s ubiquity are commonplace. In Indonesia, for instance, the brand has already opened more than 2,600 outlets, with many customers drawn to its affordable prices. A cup of brown sugar milk tea, for example, costs just $1.10, significantly cheaper than similar offerings from competitors like Chatime. Ice cream cones are even more affordable, priced at as low as 50 cents, making Mixue a go-to destination for budget-conscious consumers.

Affordable Luxury: The Key to Success

Mixue’s success is not just about affordability; it’s also about the quality and variety of its offerings. The company supplies its franchisees with ingredients for a wide range of unique and flavorful drinks, such as Creamy Mango Boba, Mango Oats Jasmine Tea, and Coconut Jelly Milk Tea. This focus on both quality and affordability has allowed Mixue to carve out a niche for itself in a crowded market, appealing to a diverse range of consumers, from students to working professionals.

The brand’s franchise model has also been a key driver of its success. Nearly all of its stores are operated by local franchisees, who are supplied with ingredients and support by Mixue. This approach not only allows for rapid expansion but also ensures that the brand can adapt to local tastes and preferences. In Indonesia, for example, Mixue has become a popular spot for single mothers like Rahma Yuliana, who can afford to treat her daughter to a delicious and affordable dessert after school.

Mixue is not the only Chinese F&B brand making waves in Southeast Asia. Other notable players include hotpot giant Haidilao, Fish With You sauerkraut fish restaurants, and popular beverage brands like Luckin Coffee, Heytea, and Chagee. These brands have not only expanded China’s commercial influence but also introduced new flavors and dining experiences to the region.

A Shift in Perception: China’s Growing Soft Power

The rise of Chinese F&B brands in Southeast Asia reflects a broader shift in the perception of Chinese products. For years, Chinese goods were often associated with being cheap and low-quality, but brands like Mixue are challenging this stereotype by offering products that are both affordable and high-quality. This shift is part of China’s growing soft power, as its cultural and culinary influences begin to rival those of Western brands.

Professor Gordon Mathews of the Chinese University of Hong Kong notes that the expansion of Chinese F&B brands is reminiscent of McDonald’s global expansion in the 1990s, which not only brought American food to new markets but also symbolized the cultural influence of the United States. Similarly, Chinese brands like Mixue are not just selling food and beverages; they are introducing a new generation of consumers to Chinese culture and values.

Rapid Expansion and Strategic Growth

The rapid expansion of Chinese F&B brands in Southeast Asia is driven by a combination of strategic planning and a deep understanding of local markets. According to Momentum Works CEO Jianggan Li, Chinese businesses are increasingly looking to Southeast Asia for growth opportunities after facing intense competition in their home market. These companies are well-equipped with advanced automation technologies and a strong online marketing presence, which allows them to move quickly and efficiently in new markets.

In Thailand, for example, Chinese entrepreneur Siya Han has invested over $1.37 million in 12 Mixue stores and several other restaurants serving spicy broth bowls, sauerkraut fish, and fried chicken steaks. While outlets in shopping malls take longer to break even due to high rent deposits, Han’s other outlets typically turn a profit within six months to a year. This rapid turnover is a testament to the brand’s popularity and the demand for affordable, high-quality food in the region.

Similarly, in Malaysia, the Chinese sauerkraut fish chain Fish With You has seen significant success, with one outlet recouping its $235,000 investment in just nine months. The brand’s vice president, Liu Liujun, attributes this success to the large ethnic Chinese population in Southeast Asia and the region’s growing economies.

Winning Hearts and Minds: The Consumer Perspective

For many consumers in Southeast Asia, the rise of Chinese F&B brands has opened up a world of new flavors and experiences. In Vietnam, for example, Nguyen Thu Hoài was initially skeptical of Mixue as a Chinese brand but has since become a regular customer, drawn by the brand’s affordability and better-than-expected quality. This sentiment is echoed by customers across the region, who appreciate the value and variety offered by Chinese brands.

The popularity of these brands is also driven by their ability to adapt to local tastes and preferences. In Malaysia, for instance, customers like Victoria Kovalan have embraced the new Chinese brands for their innovative offerings and affordability. “It’s opened up our palates,” she says, referring to the growing popularity of Sichuan hotpots and other Chinese dishes.

The Future of China’s Culinary Empire

As Chinese F&B brands continue to expand across Southeast Asia, they are not just building a commercial empire but also fostering cultural connections. The success of Mixue and other Chinese brands is a testament to the power of China’s soft power, as its products and values gain acceptance and admiration in new markets.

However, the impact of this trend is still being felt, and the long-term implications remain to be seen. While Chinese brands have made significant strides in Southeast Asia, they face stiff competition from both local and international players. Nevertheless, their focus on affordability, quality, and innovation positions them well for continued growth and success.

As the world becomes more interconnected, the rise of Chinese F&B brands in Southeast Asia serves as a reminder of the ever-changing global culinary landscape. Just as McDonald’s once symbolized American cultural influence, brands like Mixue may one day come to represent the cultural and economic might of China on the global stage.