China’s struggling restaurants feeling queasy as debate rages over pre-made food

In the run-up to National Day, a week-long celebration viewed as a litmus test for the strength of China’s domestic consumption, a fiery feud between a celebrity entrepreneur and one of the country’s best-known restaurant chains has drawn widespread attention to cost-saving practices in the food industry.

The drama began on September 10, when influencer Luo Yonghao – a former teacher known for his outspoken views – blasted the popular Xibei restaurant chain on social media, claiming his “disgusting” meal featured pre-made food sold at premium prices.

Luo used his platform to urge mandatory menu labelling for dishes not made to order, drawing millions of comments about transparency and food quality in the country’s restaurants.

Xibei founder Jia Guolong soon fired back, insisting the chain only offers “semi-processed” items and opening the kitchens at its nearly 400 outlets. Under intensified scrutiny, videos of restaurants using packaged and frozen ingredients circulated rapidly, further validating Luo’s complaints.

With millions joining the fray online, many of the country’s eateries fear the controversy will shrink their already narrow margins and depress turnout during one of their busiest times of the year.

From January to August, the National Bureau of Statistics reported the catering industry’s income reached 3.6 trillion yuan (US$505.2 billion), an increase of 3.6 per cent over the same period in the previous year. But in 2024, the bureau’s year-on-year growth rate for the same span of months was 6.6 per cent, and 2023’s figure was 19.4 per cent.

South China Morning Post