Panicked by President Xi Jinping’s austerity plan, which is attempting to combat corruption and government spending, fine-dining restaurants in Beijing are turning to buffet, hot pot and other cheap foods to stay in business, according to Sina News.
Following the austerity measures, which began in December, China has seen a decrease in luxury spending, which has hit the country's restaurant industry, especially the ones at the upper end of the price spectrum.
Now, faced with the inevitability of lower sales, high-end restaurants are being forced to make a choice: start serving affordable food, or shut down.
Jingya Restaurant, previously known for its “first-class gourmet,” announced on Wednesday that it will go back to cooking for the masses. They have already established a takeout window selling steamed buns. In July, it plans to open its hot pot operations, and is planning to have food stalls in subway stations around Beijing.
Quan Ju De, the famed Peking duck restaurant, is having a two-day 80 percent off deal in May at its branches all over China. It is also introducing a Peking duck buffet, a move that's never been tried before.
“Buffet will be our normal mode of business in the future,” a manager at a Beijing Quan Ju De branch said. The restaurant is trying to lower the per-person -cost of eating there so it can allow customers to pay less and eat more.
These restaurants are fighting for a chance to stay alive by adapting to the new economic circumstances. In contrast, a high-end restaurant based in Shanghai, Meilin Ge, shut its Beijing branch last week, because sales decreased drastically since the austerity plan was put in place, according to Sina News.
Restaurants’ weak performance has become a trend this year, and more expensive, high-end restaurants have been hit especially hard. A report by China Cuisine Association estimated that some high-end restaurants saw their sales drop by more than 50 percent. In particular, those with annual sales of more than two million yuan ($325,670) saw negative growth for the first time since China’s economic reform began in the late 1970s, Sina News reported.
Sophie is a graduate of Northwestern University. She covers the emerging markets in Southeast Asia, with a particular interest in foreign investment in the region....