Three Store-Level Frictions That Point to Operator Opportunities

This is an English adaptation of a FoodBud historical article originally published on September 27, 2022.

A recent critique of Mixue Bingcheng judged the company largely from its website and framed it as a brand overly eager to recruit franchisees. That misses a basic operator question: what actually happens in stores, and what happens when customers buy the product?

Based on recent visits to different foodservice brands and consumption scenarios, three issues stand out. Each is also an opportunity.

1. Location Accuracy Is Still Too Loose

In Shenzhen, in areas where KFC, McDonald’s, Luckin Coffee and other brands have dense store networks, both mini-programs and apps often fail to locate the intended store precisely.

This is not an isolated issue. While waiting for an order at a McDonald’s, another customer asked staff where her order was; the staff had to explain that she had ordered from a different nearby store.

From the brand or store team’s perspective, this can look like user error: the customer did not confirm the store carefully enough before paying. But when there are eight or nine stores nearby, it can be genuinely difficult for a customer to identify which store suffix or location label corresponds to the outlet in front of them.

A similar problem occurred when reordering from a previous McDonald’s order while en route to a target store. The system pushed the order to another outlet. After arriving at the intended store and discovering the order was elsewhere, the meal was abandoned.

When stores are close together, map precision becomes a real operating issue.

Ride-hailing provides a useful comparison. In earlier years, Didi’s pickup-point selection was much more accurate than some alternatives because it invested in more refined map data. For ride-hailing, being on the near side or far side of a road creates a very different experience for both rider and driver. Meituan Waimai’s delivery maps also show how granular location data can become: in some residential compounds, map data can identify individual buildings, helping riders deliver faster and improving the experience for both couriers and customers.

Brands with high-density networks tend to be among the better-funded and more capable chains. The gap is not lack of scale; it is that restaurant digital operations and detailed user-experience thinking have not yet reached that level of precision. As product capabilities and store networks reach bottlenecks, more attention will likely shift to these detailed experience layers.

Mobile ordering is already convenient. Improving advance ordering helps both sides: stores can operate more efficiently, and customers can pick up food faster.

2. Membership Programs Need Stronger Everyday Value

In recent years, many sectors have started selling memberships: hotels, OTAs such as Ctrip, video platforms such as Tencent Video and iQiyi, restaurant chains such as McDonald’s, and delivery platforms such as Meituan Waimai.

Ctrip previously sold memberships, but later stopped. Its benefits were not essential enough, and travel is a low-frequency category. The willingness to buy a membership is naturally low, except in specific cases such as trying to accelerate train-ticket purchases during Chinese New Year.

For restaurant chains, it is understandable that a single brand would sell memberships to build loyalty. But eating one brand repeatedly can become tiring. McDonald’s has offered many membership variations, and after buying several of them, the experience becomes repetitive.

This may be a better opportunity for Meituan Waimai. A single brand can fatigue users; a multi-brand bundle has more potential. But that requires an integrator. The hard question is whether Meituan Waimai has enough leverage in rigid consumption occasions such as breakfast and lunch to secure discounts on core products from different brands. If the main benefit is only saving a small delivery fee, the offer may not be compelling enough for consumers.

3. Large Categories Still Reward Micro-Innovation

In fast food, McDonald’s and KFC have strong systems from a food-safety perspective. If taste is not the primary concern, their products also offer strong value for money.

They continue to innovate, but their core products, especially burgers, have not changed dramatically. McDonald’s Angus series, for example, has burger buns that can feel quite hard, leaving room for micro-innovation in product experience.

Looking across fast-food companies, single-brand scale in Western-style fast food is larger than in Chinese fast food. KFC generated USD 7 billion in revenue in 2021. Chinese fast-food brands such as Country Style Cooking and Laoxiangji remain far smaller by comparison.

Tastien, founded by people who came out of Wallace, shows how a small product change can create differentiation. The brand made a micro-innovation in the burger bun, giving its burgers a texture that feels different from McDonald’s and KFC-style products. It is not easy to find another burger with the same mouthfeel, which creates a degree of distinctiveness.

By the end of last year, Tastien had received investment from Source Code Capital and Buhuo Ventures, and its store-opening pace had accelerated. According to data from Narrow Door Canyan, Tastien’s store count had already exceeded 1,700.

Large categories keep producing large players because the water is deep enough for them to grow.

Note: Financing and revenue figures are historical and reflect the article’s September 27, 2022 context.