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prefabricated dishes are very popular, but most people’s understanding of them is still very vague.
In the eyes of the mass consumers, precooked dishes are Kwai bags, lazy dishes and fast food. However, in the eyes of traditional catering, prefabricated dishes are expected to become a stepping stone to change the current business dilemma and deal with a new round of survival of the fittest and industry reshuffle.
Who is hyping prefabricated dishes This paper preliminarily analyzes the changes brought by prefabricated vegetables in the b-end industry and the cognitive barriers of C-end consumers to prefabricated vegetables. From the perspective of the industry, this paper will further discuss how much imagination there is in the transformation of traditional catering to prefabricated dishes? What opportunities does the prefabricated food bring to the traditional catering enterprises?
Where do prefabricated dishes come from and go?
According to the classification of treatment methods, prefabricated dishes roughly include ready to serve food, ready to cook food and hot / ready to eat food. Among them, instant foods are mainly raw materials and clean vegetables, which need to be cooked and seasoned on site. The common vegetable platter in hotpot shops is a typical instant food; That is, cooked food is cooked clinker products that need to be reheated before they can be eaten; Instant / ready to eat foods are cooked food products that require simple heating or can be unpacked and ready to eat.
For the traditional catering industry, the main source of prefabricated dishes is the professional food factory represented by weizhixiang or the food raw material supplier similar to Guolian aquatic products. Some enterprises, like Jia Guolong’s Kung Fu cuisine, build their own central kitchen for centralized cutting and cooking, or hand it over to a third-party OEM central kitchen to provide the supply of prefabricated dishes. The common prefabricated dishes in the mass consumer market mainly come from catering enterprises or new brands of prefabricated dishes manufactured by OEM.
Different from the hot scene of prefabricated dishes only recently noticed by mass consumers, the domestic prefabricated dish industry has already passed the early stage of development. When western fast food represented by KFC and McDonald’s entered China, the traditional catering industry was also thinking about how to realize the standardization of Chinese food. Prefabricated dishes were regarded as a feasible solution at that time.
However, due to the high requirements of Chinese food on the freshness of food raw materials and cooking methods, the supply chain problems such as the production, storage and transportation of Chinese prefabricated dishes have not been solved, which has also become an important breakthrough in promoting the development of the industry.
Li Jian, founder of xinliangji, once mentioned in the public sharing that the supply chain is the second half of catering. Finally, whoever can establish it first than other enterprises at the end of the supply chain and compete based on the comparative advantage of social division of labor is likely to win in the catering competition in the future. Prefabricated dishes are a key for traditional catering to seize the advantage at the end of the supply chain.
In recent years, with the gradual maturity of production technology of catering manufacturers and the prosperity of warehousing and cold chain logistics industry, the complete supply chain system of prefabricated vegetables has been basically complete and entered a period of rapid growth. Prefabricated dishes also gradually transition from categories with high added value, complex production process and easy storage to categories with low added value, relatively simple production process and high freshness. The trend of catering chain and the industry demand of supply chain integration have also become an important driving force to send prefabricated dishes to the industrial outlet, pushing prefabricated dishes to the back kitchen of catering enterprises.
Open the door of Chinese food chain
According to the statistics of the National Bureau of statistics, from 2013 to 2019, the income of China’s catering industry increased from 2556.9 billion yuan to 4672.1 billion yuan, showing an overall upward trend. However, there is still a big gap in the rate of catering chain compared with developed countries. The low chain rate of Chinese food is mainly due to the limited market supply of professional kitchen staff and the complex supply of raw materials.
Traditional catering enterprises often focus on the back kitchen. Whether the offline stores can expand rapidly and operate stably depends on whether the enterprise can recruit professional back kitchen talents to a certain extent. According to the data disclosed by New Oriental culinary school in 2019, the number of Chinese chefs has exceeded 10 million. However, with the emergence of various solutions to replace professional chefs, such as prefabricated dishes, the demand for chefs in the catering industry has begun to decrease.
According to the financial report of New Oriental culinary school in 2020, its culinary business fell sharply, and the number of people participating in chef training decreased by 11.5% year-on-year. Behind the reduction of new chefs is the general trend of the catering industry moving closer to the FMCG chain model, and a large number of prefabricated dishes produced on the central kitchen assembly line are gradually replacing experienced chefs.
According to the survey results of China Hotel Association, 74% of chain brands in China have built their own central kitchens, and more than half of them are developing standardized semi-finished prefabricated dishes that can be eaten directly after heating, which are distributed to offline stores through the cold chain and can be provided to customers after simple processing.
In terms of supply chain, the traditional Chinese food supply chain generally includes six nodes: origin, broker, primary wholesale of origin, primary wholesale of sales land, secondary wholesale of sales land and terminal channel. Each link will increase the price of raw materials by 2% to 30%. The complex food material supply chain system not only brings high food material cost burden to the chain of terminal catering enterprises, but also makes catering enterprises bear the risk of food material corruption rate due to the uneven cold chain transportation conditions in all links.
However, after the use of prefabricated dishes, chain catering can further reduce the cost of food materials by integrating the supply chain and removing complicated intermediate nodes. At the same time, suppliers ensure the whole process cold chain transportation and reduce the corrosion rate. The realization of unification and standardization in the supply of food materials provides a solid logistical guarantee for the expansion of traditional catering stores, and can still ensure the supply of food materials even in the process of accelerating the sinking to the second and third tier cities.
For a long time, the traditional catering industry has been facing the “four high and one low” problems of high store rent, high labor cost, high food material cost, high energy price and low gross profit. Among them, the purchase cost of food raw materials generally accounts for more than 40% of the total cost, the labor cost accounts for about 20%, and the store rent cost accounts for more than 10%. The use of standardized prefabricated dishes can not only reduce labor costs, but also reduce the back kitchen area, reduce the total cost and improve the floor efficiency at the same time.
Based on the takeout data of meituan, an organization calculated a restaurant with an area of 20 square meters, an average of 80 orders per day, a customer unit price of 35 yuan and mainly engaged in takeout. The results showed that the use of prefabricated dishes increased the cost of food materials from 30% to 36%, but the saved labor and rental costs were enough to cover the original cost, and the profit of the store was increased from 3200 yuan to 3700 yuan, thus improving the overall profit margin of the restaurant. If the catering enterprises with larger scale and chain operation are calculated according to this model, the effect of using prefabricated vegetables to reduce costs and increase efficiency is more obvious. Therefore, prefabricated dishes solve the problem of “four high and one low” in traditional catering and pave the way for Chinese food chain.
In addition, many traditional catering enterprises are exploring how to use digital means to turn offline passenger flow into users, but the services of traditional catering enterprises based on offline consumption scenes are still unable to achieve efficient activation and transformation through online digital means. Based on this pain point, the standardized mode of prefabricated dishes has brought the products and services of traditional catering enterprises closer to users, and found a broader market space for the whole food industry in the field of mass consumption.
Retailing: a new opportunity for prefabricated dishes?
In fact, prefabricated dishes are not only available in China. The United States has long had prefabricated versions of pizza and pasta. Japan also has wheat, fried rice and fried pork chops that can be cooked quickly. Compared with the rising of China’s Prefabricated vegetable industry, the prefabricated vegetable industry in the United States and Japan has developed more mature, which is related to the economic development process experienced by each country.
From a macro perspective and industrial background, China’s Prefabricated vegetable industry has experienced a similar development process as that of the United States and Japan: from the growth of GDP, the improvement of national consumption level, the increase of dining out demand, to the industry trend of catering chain, and the rise of rent and labor cost forced the standardized development of catering industry.
The slight difference is that the channel mode of China’s Prefabricated food industry is more diversified, which may fully open the retail wave of traditional catering.
For example, the prefabricated dishes produced by food factories can be provided to catering brands such as Jia Guolong Kung Fu dishes, or self-supporting brands, which can be sold directly to ordinary consumers through offline retail or e-commerce channels; Catering brands can also cooperate with food factories to develop products, and then develop the retail business of prefabricated dishes with the help of online and offline channel resources; In addition, some players of new consumer brands can also customize products through OEM, and directly join the industry competition in combination with major e-commerce channels. The multi competitive market environment provides a certain possibility for the short-term outbreak of prefabricated vegetables in the mass consumer market.
A typical example is that after being made into convenience food, snail powder quickly became a popular food loved by young people. At the same time, a variety of new brands of snail powder also emerged. According to the Guangxi Liuzhou Municipal Bureau of Commerce, the sales revenue of the whole industrial chain of Liuzhou snail powder has reached 50.16 billion yuan in 2021, and the sales revenue of bagged Liuzhou snail powder alone has reached 15.197 billion yuan, a year-on-year increase of 38.23%.
In addition, with the continuous promotion of consumption upgrading and lazy economy, the prefabricated dishes represented by Kwai Fu dishes, because they have eliminated the links of food pretreatment, avoided the accident of “hand and residue party” cooking and overturn, and are likely to become the source of food supply for young families. This leads to the daily consumption habits of prefabricated dishes instead of traditional raw materials, and thus to fresh retail, Community group buying and other existing business formats have an important impact.
The improvement of “cost reduction and efficiency increase” and chain efficiency of prefabricated dishes will help traditional catering enterprises cope with the dilemma of offline catering formats to a certain extent, and retailing is more like a new opportunity to meet a new round of reshuffle of catering industry. Under the standardized product form, traditional catering enterprises have reduced the cost burden of offline operation and obtained greater development space. They can devote more energy to thinking about how to achieve higher operation efficiency and meet the catering needs of users faster.
In the future, catering enterprises may no longer be a chain entity with stores all over the world, but become a food content provider, develop a product R & D system with equipment, technology and formula as the core, and provide consumers with personalized food supply solutions with digital operation mode. Perhaps by then, consumers will no longer have to worry about what to eat tomorrow. They can even automatically obtain daily recipes from fixed catering enterprises, and the whole catering industry will gain a huge market that has never existed before.
Author: Bai Lu; Source: Jingzhe Research Institute (ID: jingzheyanjiusuo), reprint has been authorized.
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