An Investigative Study on the Development of Chinese Fast Food Restaurant in United Kingdom

Executive summary

Due to the insufficient Chinese restaurants, which offer high-quality food in UK market, the researcher deemed it necessary to investigate the probable cause of the fall of Chinese fast food chain and/or restaurants.

As research organization Mintel (2015) investigated, Chinese food is the nation’s favourite foreign cuisine in UK. Chinese fast food experienced its great prosperity and development (Fast Food Industry Profile: China, 2012), but fell behind the western fast food brands due to problems (Judy and Elektra, 2013). The solution to this problem are conducting brand creation; expanding brand influence; pay more attention to brand product operation; and change the family business to brand chain management model (China Food & Drink Report, 4, pp. 103, 2012; Chaudhry and Crick, 2004; Dyer, 1994). Through these three aspects, it concludes that Chinese fast food should focus on brand operation.

This research focuses on the development of Chinese fast food restaurant in UK market, applies SWOT strategic model to analyse the prospect of Chinese fast food brand in the UK market, and draws the transformation measures of Chinese fast food brand operation. It introduces the corresponding solving methods, which will then be analysing the brand product operation methods for the Chinese fast food from the following four aspects: Product, Price, Place, Promotion.

TABLE OF CONTENT

1 Backgrounds and Introduction        1

2 Literature Review        3

3 The Development of Chinese Fast Food in UK Market        4

4 The Analysis of Chinese Fast Food Prospects in UK by SWOT        5

4.1 The Analysis of Strength (S)         5

4.2 The Analysis of Strength (W)         6

4.3 The Analysis of Strength (O)         6

4.4 The Analysis of Strength (T)         7

5 Recommendations        9

5.1 The Solutions Based on SWOT Analysis         9

5.2 The Solutions Based on 4Ps marketing framework         9

6 Conclusion        11

References        12

LIST OF TABLE

Table 1: Price Comparison of Chinese and UK Food        5

Table 2: British Favorite Fast Food        7

Table 3: The Solutions Based on SWOT Analysis        9

1. Backgrounds and Introduction

More and more Chinese students are living in UK and are used to eating Chinese food but they don’t find any suitable restaurants to satisfy their cravings. This situation paved way to the curiosity of the author to conduct a study about Chinese fast food chain in UK market.

According to the Restaurants Industry Profile of China (2015), the domestic Chinese food industry has developed to the stage of brand enhancing, while the Chinese food brand in UK still stay the transition phase from quantitative expansion to brand establishment. In UK, there are a few Chinese food enterprises based on brand management, primarily is family business management (Chaudhry and Crick, 2004).

This paper intends to find out the current development situation of Chinese fast food restaurants in UK by applying Strengths Weaknesses Opportunities and Threats (SWOT) model to analyze the Chinese food industry.

Lastly, this paper will enlighten the readers about the current stage of the Chinese food industry and provide substantial and possible solutions.

2. Literature Review

A study investigated by Stones (2015), Chinese food is nation’s favourite food, almost four in five (78%) Britons have loved it in the past three months and 12% eating it at least once a week.

The Restaurants Industry Profile of China (2015) described that the domestic Chinese food industry has a better foundation of development and Ember et al. (2007) showed that restaurants exist in almost all of the European countries. But Chinese food industry fell behind the Western brands (Judy and Elektra, 2013), because there are few restaurants based on brand management and most of them are family-owned as mentioned by Chaudhry and Crick (2004). So the Chinese food industry has been into the decline period (Buxel et al., 2014).

To solve this problem, SWOT is used to analyse the Chinese fast food prospects. Taylor (1994) described that Chinese food has lots of types, such as Cantonese, Sichuan, Zhejiang, etc., which will give customers various choices. Furthermore, Lv and Brown (2003) mentioned that a meal contains balanced nutrition, which is better than European food that has high calories such as chips, steaks, and pizzas. Since British are health conscious, it is a good opportunity to attract customers (United Kingdom Food and Drink Report, 3, pp. 85-86, 2013). In other words Chinese good eating habits can be utilized to strengthen brand appeal (China Food & Drink Report, 4, 2012), therefore, opportunities will develop. However, Chaudhry and Crick (2004) described that there are still some weaknesses existing in Chinese food industry: the labor shortage and Foodservice Industry Profile: Europe (2010) added the lack of standardization and regulation.

To solve these problems, McCarthy (1964) and Magrath (1986) elaborated that the 4Ps (Product, Price, Place, Promotion) are beneficial for enterprises to survive and develop. First, in a study by Amélie and Bianca (2014), the product is the main support of a company, so in the design of food, it can focus on the outstanding products nutrition features. Second, the price is important factor. Inexpensive food with high quality can easily win consumers’ loyalty (Werbner, 1984). Third, Promoting products and services or corporate with social responsibility will increase the brand image (Jackson et al., 2004; Cornelius et al., 2008). Finally, as Coughlan et al. (2014) stated that choosing a proper marketing channel could reduce the operating cost.

3. The Development of Chinese Fast Food in UK Market

According to the investigation from BMI in 2006, the food that can be prepared quickly and easily is increasingly becoming one of the staple foods for Europeans. It is visible that the Chinese fast food has a great market in Europe. Chinese fast food enterprises ought to grab the opportunities to enter into mainstream catering market instead of merely aiming at Chinese.  

The Chinese restaurants exist in almost all of the European countries like Netherlands, Belgium, France, Britain, Germany, Spain, Italy and etc. And in most of these restaurants are small restaurants, which are family-owned. From the late 1990s until now, Chinese food industry has been into the decline period (Buxel et al., 2014), the poor sanitation condition, capital shortage and etc. caused a large amount of Chinese restaurants bankruptcy.