Recently, the topic of pre-packaged meals entering schools has surged in popularity, making it a hot topic on social media. This has sparked considerable controversy, with many parents questioning the safety of pre-packaged meals in schools. Concerns arise due to the fact that minors are in a crucial growth stage, and any food safety issues can be particularly worrying.
On the other hand, there are practical issues to consider. Many schools find it difficult to operate cafeterias efficiently and often outsource to meal delivery companies. These companies typically use central kitchens to prepare and deliver meals on the same day. However, due to considerations like cost, consistent taste, and speed of service, some outsourced meal delivery companies have begun using pre-packaged meals.
Parents feel their right to know has been violated, as they were unaware their children have been consuming pre-packaged meals for an extended period. Cafeterias argue that there are no safety issues with pre-packaged meals, so why can’t they be consumed?
Unexpectedly, pre-packaged meals have re-entered public awareness in this manner.
Actually, pre-packaged meals have been gaining popularity since last year. In early 2022, several pre-packaged meal concept stocks saw their prices hit consecutive limits. Although there was a slight pullback, the scale of pre-packaged meals in both the dining and retail sectors has visibly expanded. During the outbreak of the pandemic, pre-packaged meal stocks started to rise again in March 2022. On April 18, 2022, companies like Fucheng Shares, Delisi, Xiantan Shares, and Zhongbai Group saw their stock prices hit limits, while Fuling Zhacai and Zhangzi Island saw gains of over 7% and 6%, respectively.
Pre-packaged meals cater to the contemporary “lazy economy,” “stay-at-home economy,” and “single economy.” These meals are primarily made from agricultural products, livestock, poultry, and seafood, and undergo various processing steps such as washing, cutting, and seasoning before being ready to cook or eat directly.
Based on the ease of processing or the convenience for consumers, pre-packaged meals can be categorized into ready-to-eat foods, ready-to-heat foods, ready-to-cook foods, and ready-to-prepare foods. Common ready-to-eat foods include Eight-Treasure Congee, beef jerky, and canned goods that can be eaten right out of the package. Ready-to-heat foods include frozen dumplings and self-heating hot pots. Ready-to-cook foods, like refrigerated steak and crispy pork, require cooking. Ready-to-prepare foods include cut raw ingredients available on platforms like Hema Fresh and Dingdong Maicai.
These pre-packaged meals are convenient, appropriately portioned, and naturally popular among “lazy” individuals or the single demographic. In 2021, China’s pre-packaged meal market reached 345.9 billion RMB, and within the next five years, it is expected to potentially reach a trillion RMB market size.
In addition to the retail end, the dining sector also “favors” pre-packaged meals, accounting for 80% of the market consumption scale. This is because pre-packaged meals, processed in central kitchens and delivered to chain stores, provide a solution to the long-standing standardization challenge in Chinese cuisine. Since they come from the same production line, the taste is consistent.
Previously, restaurant chains struggled with inconsistent flavors, often dependent on the skills of individual chefs. Now, with pre-packaged meals, flavors are standardized, reducing the influence of chefs and transforming them into regular employees.
The benefits of pre-packaged meals are evident, leading large chain restaurants to adopt them quickly. Chains like Xibei, Meizhou Dongpo, and Haidilao have all incorporated pre-packaged meals into their offerings.
With the growth of group buying and the takeaway market, more pre-packaged meals are entering the dining industry, ultimately reaching consumers.
In summary, pre-packaged meals have proven their convenience and scalability. As the dining industry continues to develop, pre-packaged meals serve as a cost-effective, quality-maintaining solution.
Compared to Japan, where pre-packaged meals account for 60% of total food consumption, China’s ratio is less than 10%. In 2021, China’s per capita consumption of pre-packaged meals was 8.9 kg/year, less than 40% of Japan’s.
Research indicates that in 2020, the top ten companies in China’s pre-packaged meal industry accounted for only 14.23% of the market, with leading companies like Lvjin Food, Anjoy Foods, and Weizhixiang holding market shares of 2.4%, 1.9%, and 1.8%, respectively. In contrast, Japan’s pre-packaged meal industry achieved a 64.04% market share for the top five companies in 2020.
Compared to Japan, China’s pre-packaged meal industry is still in its infancy, with low barriers to entry and low market concentration.
As a new consumption trend in recent years, the domestic pre-packaged meal market is expected to reach a trillion RMB. The low industry concentration and low market barriers have attracted many enterprises to enter the pre-packaged meal field.
From 2012 to 2020, the number of pre-packaged meal-related companies in China grew from fewer than 3,000 to nearly 13,000, with a compound annual growth rate of almost 21%. As of the end of January 2022, the number of pre-packaged meal companies in China had approached 70,000, indicating a rapid expansion in recent years.
Currently, there are five main types of players in the domestic pre-packaged meal track.
First, agricultural and aquaculture companies, which connect upstream raw materials to downstream pre-packaged meals. Examples include listed companies like Shengnong Development, Guolian Aquatic, and Longda Food.
These companies’ pre-packaged meals include chicken products, processed meat products, rice and noodle products, and breaded products. Companies like Shengnong Development, Chunxue Foods, and Guolian Aquatic not only develop the domestic pre-packaged meal market but also export them overseas.
The second type includes more specialized pre-packaged meal companies focused on production, such as Weizhixiang and Gaishi Foods. Their pre-packaged meals range from algae, mushrooms, and wild vegetables to aquatic products and poultry.
The third type comprises traditional frozen food companies entering the pre-packaged meal field, such as Qianwei Central Kitchen, Anjoy Foods, and Huifa Foods. Similarly, some catering companies have ventured into pre-packaged meals, like Tongqinglou and Guangzhou Restaurant, producing their signature dishes as pre-packaged meals to increase revenue and reduce costs.
The fourth type includes fresh retail companies like Hema Fresh, Dingdong Maicai, MissFresh, Meituan Maicai, and Yonghui Supermarket. These companies directly connect with consumers, meeting customer needs with wide sales channels and strong brand recognition, often leveraging joint promotional activities.
The entire pre-packaged meal industry chain connects upstream agricultural sectors, covering vegetable cultivation, livestock and aquatic farming, grain and oil industries, and seasonings. Through specialized pre-packaged meal producers, frozen food manufacturers, and supply chain companies, the products are transported via cold chain logistics and storage to downstream sales.
Compared to traditional agricultural products, pre-packaged meals have higher added value due to multiple processing steps, promoting local agricultural development and standardized production. They also support deep processing of agricultural products, contributing to rural revitalization and economic development.
However, due to the low entry barriers, the quality of pre-packaged meal companies varies, leading to quality and food safety issues.
Given the nature of pre-packaged meals, if consumers find the taste unsatisfactory or encounter issues, the subsequent return process and potential losses are not well-defined.
Therefore, this field should receive attention from national and provincial governments to establish more regulations.
In April 2022, under the guidance of the Ministry of Agriculture and Rural Affairs and the China Green Food Development Center, the China Pre-packaged Meal Industry Alliance was established as the first national public welfare self-regulation organization for the pre-packaged meal industry. This alliance, supported by local governments, research institutions, and economic research organizations, aims to better promote industry standards and ensure healthy and orderly development.
Provinces are also gearing up for fierce competition in the pre-packaged meal industry.
Guangdong stands out as a leading province in the domestic pre-packaged meal sector. Considering policy support, the number of pre-packaged meal companies, industrial parks, and economic and consumption levels, Guangdong is at the forefront.
Since 2020, the Guangdong government has taken the lead in systematizing, standardizing, and organizing the development of the pre-packaged meal industry at the provincial level. In 2021, following the establishment of the Pre-packaged Meal Industry Alliance and the promotion of the Guangdong-Hong Kong-Macao Greater Bay Area (Gaoyao) Pre-packaged Meal Industrial Park, Guangdong experienced a surge in pre-packaged meal development.
In March 2022, the “2022 Provincial Government Work Report Key Task Division Plan” included the development of pre-packaged meals, and the Provincial Government Office issued “Ten Measures to Accelerate the High-Quality Development of Guangdong Pre-packaged Meal Industry.” This document provided policy support in areas such as research and development, quality safety, industrial cluster growth, exemplary enterprise cultivation, talent training, cold chain logistics construction, brand marketing, and internationalization.
For companies to capture the market, local government support, brand building, marketing channels, and especially cold chain logistics construction are crucial.
Guangdong’s policy support and local enterprise development efforts are substantial. Following Guangdong,
