I stopped keeping track of foreigners who asked me about starting a cafe, restaurant, coffee shop, or some such food place in China. More and more foreigners are interested in staying in China on a long term basis, and somehow they keep coming up with the same idea for business.
Some foreigners (that is, foreign to China) have a very good idea of what they are doing and are very focused on making their cafe or restaurant make money. Many others are not so focused and are naïve to the costs involved in running a restaurant. It is all about location and market.
I was a waiter once...for a few weeks. I was horrible. What I have noticed from my not-so-vast experience in the food industry and from relationships with many who were (including many in China) is that restaurants require a high commitment of time. Restaurant owners are busy all day, everyday, and have a hard time taking any time off. In short, opening a restaurant can be equal to selling your soul, if you are not careful.
And what of cafes or restaurants in China? It is easy to both over or under estimate the Chinese market for foreign food. It very much depends on where the restaurant will be located. I am speaking primarily of Western food places or coffee houses, assuming that a foreigner opening a Chinese restaurant in China is a non-starter.
Many foreigners over estimate the market. They do not have a good feel for what Chinese people really eat and how often they eat it. There must be a calculated reason Kentucky Fried Chicken is the first Western food chain to appear in Chinese cities. McDonald's is never first. Chinese just do not like burgers as much as fried chicken...in general.
Compare the average and mean age of diners in KFC and McDonald's and the results will prove who eats Western food. The young (15-35) and increasingly wealthy Chinese fill both, but McDonald's is noticeably younger. Western food will sell better to the young, either children of wealthy middle class or established young entrepreneurs (China's yuppies).
Some foreigners to China under estimate the buying power of these young folks when it comes to a fashionable hang out, a place to eat Western food with friends and collegues. And some foreigners do not do their research to determine the demand in a specific market.
Having spent some time in Thailand and Vietnam, I am shocked at the amount of coffee sold. China just does not have the coffee drinking market that Southeast Asia seems to have. It may be developing, but an accurate evaluation must be made in China before jumping in head first to a money losing situation trying to sell Western food and coffee.
The right place in any large Chinese city will bring the amount of coffee drinking, Western food eating customers. As soon as a move to the outside of the city or a small city is made, though, I would suggest a second look at the situation to evaluate the market desire.
To some degree, this is all obvious, but I still say it because too many have over estimated the Chinese desire.
