Gov’t says import of mainland Chinese F&B brands essential for Macau’s economy

Recognizing the growing presence of mainland Chinese F&B brands in Macau, Vincent U, president of the Macau Commerce and Investment Promotion Institute (IPIM), has emphasized that these enterprises have long been a vital part of Macau’s economy.

In an interview with the Times on the sidelines of a G2E Asia event, U said that their consistent investments are significantly contributing to the market development with their consistent investments significantly contributing to market development.

In recent years, Macau has witnessed a significant influx of mainland Chinese restaurant brands.

Alongside well-known establishments in various integrated resorts, such as Tai Er, famous for its signature Chinese Sauerkraut Fish, and the Haidilao hot pot chain, the city also boasts numerous popular mainland tea shops, particularly concentrated in the city’s centers and tourist hotspots, including Taipa.

On this matter, U shared with the Times earlier this week how IPIM has supported mainland brands in establishing a presence in Macau.

“While many have opened multiple stores across various cities and are familiar with mainland operations, they face challenges when expanding into new regions due to differing market environments, legal regulations, site selection processes, and customer preferences. They aim to leverage their Macau experience for future international growth. For example, Tai Er launched its first store in Macau with IPIM’s assistance during the COVID-19 pandemic. Notably, some tea brands have even opened more branches in Macau than in other regions.”

U noted that current statistics on the number of brands in Macau, particularly in the catering industry, are unclear, with a lack of specific growth figures.

However, he emphasized that in recent years, mainland China’s catering industry has accelerated its development in terms of chain stores and branding, showing particularly strong performance in the Macau market.

“However, their core objective is not solely to target Macau’s population market, but to gain insights into the operational environment overseas through Macau,” he said.

He cited the example of a brand that expanded into Southeast Asia and other regions after entering the Macau market, showcasing strong growth in its international business.

“They chose to open a store in Macau during the pandemic, gaining valuable overseas operational experience that laid the foundation for their subsequent expansion.”

The IPIM chief noted that in recent years, many mainland companies have chosen to form joint ventures with local businesses or enter the Macau market through franchise agreements. This approach allows local young entrepreneurs to operate tea beverage businesses using established brands without needing to create their own.

“This model enriches Macau’s dining options and provides local businesses with greater opportunities.”

According to him, from the perspective of market competition, the entry of mainland brands is not just about increasing numbers; it also introduces diverse dining options that drive overall market development. This approach can be viewed as a strategy to expand the market “pie” while simultaneously promoting business opportunities for local companies.

He believes that the entry of mainland brands has not only created new job opportunities but also given local youth greater room for development.

“Large mainland companies typically have well-established training systems. Some young people are sent to the mainland for training before opening a store in Macau, where they acquire operational skills before returning to start their businesses. This model not only enhances their professional capabilities but also injects fresh vitality into Macau’s catering market.”

The IPIM chief anticipates a 20% increase in investment promotion this year, particularly from listed companies and leading enterprises. In promoting the first-mover economy, the focus will be on new store openings in Macau, especially those from Portuguese-speaking countries and Southeast Asia. “We are actively seeking outstanding brands from these regions to enrich Macau’s market.”

He believes that introducing such brands will not only drive incremental growth and create new investment opportunities but also promote job creation, aligning with the goals and direction of their work.

Influx has effectively encouraged the industry to self-improve

Regarding the entry of numerous mainland food and beverage brands into Macau, Aeson Lei, president of the Macao Catering Industry Association, noted that, rather than creating a sense of crisis for local brands, this influx has effectively encouraged the industry to self-improve.

“Local businesses are learning from these large food chains in areas such as site selection, supply chain management, capital strategy, and overall strategic planning.”

“However, relying on just one or two brands to sustain a community’s economy is unrealistic,” he said. On the contrary, “the initial novelty of opening a new branch may provide short-term stimulation.”