America is about to be hit by a 'tsunami' of authentic Chinese restaurants

Yahoo

05-04-2025

The midtown Manhattan building where Jackie Kennedy, Elizabeth Taylor, and Truman Capote once dined, then the legendary French restaurant La Grenouille, is now a nondescript renovation site with wood, metal, and industrial-size garbage bins strewn about. The 60-year home of La Grenouille will soon be turned into the new American home of Quanjude, the most famous Peking duck restaurant brand in China. Quanjude, a publicly listed company controlled by a state-owned entity, bought the 6,800-square-foot building on 52nd Street for $14.3 million in October in an attempt to bring Chinese fine dining to America.
The 161-year-old brand's first branch in the US is going all out. The wallpaper will replicate a 12th-century Chinese handscroll painting. The private dining room will be decorated with traditional fans and chopsticks. But it is the quality of the food that Yan Zhang, the head of Quanjude America, wants diners to obsess about. "Chinese cuisine is exquisite and profound. But in this part of the world, people think it's just spring rolls and chow mein," Zhang said. "We want to revamp their cognition."
Quanjude is one of at least 10 major Chinese food and beverage brands planning to hit US shores this year. Driven by an oversaturated market, a troubled economy back home, and the potential to be listed on the US stock market, companies serving everything from high-end dinners to dumplings and milk tea — several of them with thousands of locations in China — are now poised to break into the US food market. And dozens more are planning to study the landscape to possibly jump in themselves.
But with the relationship between the US and China at one of its rockiest points since the two countries resumed their diplomatic relationship in 1979, the Chinese newcomers' path to success is extremely precarious. Sure, they aren't working on critical technology or launching major social media platforms, but Chinese restaurants have still faced backlash in the past few years, with some Americans blaming the country for the COVID pandemic or because of a general antipathy toward the Chinese Communist Party. Is America really ready for what some local Chinese restaurant insiders are calling a Chinese food "tsunami"?
Since the first Chinese restaurant in the US opened in 1849 in San Francisco during the gold rush, generations of blue-collar immigrants have taken advantage of the relatively low-cost entry point in the restaurant industry to make ends meet. They created dishes that are nonexistent in China, such as chop suey or General Tso's chicken, to cater to Western palettes, forming an expectation among Americans that Chinese cuisine is convenient and cheap. Chinese immigrants, meanwhile, have had to watch their cuisine sink to the bottom of their adopted country's food chain.
When Zhang started traveling around North America for his import and export business 18 years ago, he couldn't bear the Chinese food he came across. "Nothing is authentic other than the beef noodle," he said. A foodie himself, Zhang vowed to make a difference. In 2017, he reached out to Quanjude, proposing to bring the iconic restaurant to North America. He opened the first branch in Vancouver, Canada, in early 2020, right before the pandemic ravaged indoor dining. In 2022, it won a Michelin star, which it has held onto since — and Zhang expects the New York branch to get even greater plaudits.
"Chinese immigrants are better educated and wealthier now. We crave for a better presentation of our own culture," said Zhang. "It is the best time for food brands in China to expand overseas."
While there are some Chinese fine-dining restaurants in the US run by Chinese Americans, the new wave brings some of the best-known restaurant brands in China.
The timing is made more urgent by China's recent economic troubles. The Chinese government says the revenue of the food and beverage industry in the country increased just 5.3% in 2024, a nosedive from the 20.4% increase in 2023, and the smallest growth in a decade excluding the pandemic years. An industry report on 22 publicly listed Chinese food and beverage companies found that 68% saw their profits decline in the first half of last year. Close to 3 million restaurants and cafés in China shut down for good last year.
To have a store in Manhattan is like erecting a flag on the moon. It's worth it even if you don't make money.
Chinese food brands' moves to open overseas — which had been increasing modestly since the 1980s — have rapidly accelerated. Hongcan Industry Research Institute, a Chinese group that studies the restaurant industry, released a report in September that found more than 100 Chinese food and beverage brands have moved into more than 180 countries, now running 700,000 locations outside China — a 200,000 increase since 2016. The Chinese government has spurred on the expansion, issuing two directives last year for Chinese food and beverage brands to "go overseas" to help "improve the international influence of Chinese cuisine culture."
"Almost all the major food and beverage brands you see in China are considering coming to the US," said Beichen Hu, a restaurant investor and the director of the North America Asian Food Industry Association. "A popular catchphrase circulating broadly in the food industry in China is 'to go overseas or to die.'"
The US market certainly looks appealing. The food service industry reached over $1 trillion in sales last year, with $1.5 trillion projected in 2025. A survey by the National Restaurant Association found that 80% of restaurant operators in the US expect their sales this year to be the same or higher than last year's. An analysis by IBISWorld predicted a promising market for Chinese restaurants in the US through 2030 as the demand for Chinese food among households with annual income above $100,000 is expected to increase.
For as much of a setback as it was, the pandemic also offered a rare opportunity. "Many prime locations in coveted places like Manhattan are vacant after the pandemic, and that opens the market for brands from China," said Tom Chen, the founder of Kepler Mission Design Group, a design and branding company that's helped food and beverage chains from China open in the US. Leading Chinese brands have snatched up space in competitive areas like Fifth Avenue and Times Square in New York and Beverly Hills in Los Angeles.
"These brands don't want to be just another Chinese restaurant in the US; they want the esteem," said Chao Wang, the owner of the rice-noodle shop Hunan Slurp in New York's East Village. He's helping restaurants from Hunan province, where he's from, to open in the US. "To have a store in Manhattan is like erecting a flag on the moon. It's worth it even if you don't make money."
Still, the cuisine push from China may seem counterintuitive. The tension between the US and China, especially Washington's restrictions on Chinese tech companies in recent years, has created a palpable chilling effect. Figures on foreign investment from China vary significantly, but they all show a steep drop in Chinese investment into the US in the last several years. The most recent annual survey by the China General Chamber of Commerce — USA found that in 2023, more than 60% of Chinese companies in the US complained about the deteriorating business environment and 22% had reduced investment here.
But geopolitical risks are not top of mind for most eateries. "The US is still a pro-business country. And we sell consumer products, not computer chips," said Amanda Wang, the owner of Ningji, the leading Chinese chain of lemon-based teas, with more than 3,000 stores in China. Its first overseas outlet is opening in mid-April in Los Angeles with a product line customized for American consumers called bobobaba. And the company is already looking for more locations.
This is an industry that is safe until Chinese companies start to win, and then they're not safe.
Wang said the biggest cultural shock for her is the time it takes to open a store in the US. Ningji decided to take over the fully functioning venue of a shuttered beverage store in the Los Angeles suburb of Glendale last November, but as of early February, Wang was still waiting for the license to be approved to start the renovation. "I am speechless," said Wang. "We open a new store on average in 20 days in China."
Wang was also confused by a recent street encounter. Two days before the new year, on her way to the supermarket, a stranger yelled at her to "go back to China," and blamed her for stealing jobs in the US. "I don't understand why he thought I stole his job," said Wang. "We are here to create jobs."
This kind of hostility isn't exactly rare. A Pew Research Center survey from May found that eight in 10 Americans have negative views about China, and a study by researchers from Boston College, the University of Michigan, and Microsoft found that Asian restaurants in the US lost $7.4 billion in revenue in 2020 because of anti-Chinese sentiment, which President Donald Trump helped stoke by calling COVID-19 the "China virus."
"Trump likes to stir racial antagonism," Chao Wang of Hunan Slurp said. The window of a noodle shop Wang owned in Long Island City, New York, was smashed during the pandemic, and he attributed it to anti-Asian hate.
Yong Zhao, the cofounder and chief executive of the American food chains Junzi Kitchen and Nice Day, had a disturbing moment a few months ago with a customer at his store in Long Island. "I told him we are going to bring organic mushrooms from a local farm into our recipes, and he said, 'Oh, is the farm owned by the CCP?'" said Zhao. The customer was referring to the rising concern that the Chinese Communist Party is spying on the US from farmlands purchased by Chinese entities. "If I were white, I don't think he'd have asked."
Before the pandemic, Zhao, a Yale-educated environmental scientist turned restaurateur, had formed a network of young Chinese restaurant operators in the US with a mission to "tell the stories of Chinese cuisine." But he said since the trade war began in 2018, American media has much less coverage of Chinese culture and lifestyle, and Americans seem less interested in Chinese culture. "Say, you want to highlight the history of a traditional dish from Chengdu, but many people here don't know where Chengdu is," said Zhao, referring to the southwestern Chinese city that is known for mapo tofu and kung pao chicken.
To some industry people I spoke with, Chinese food companies are less likely to be caught up in geopolitical wrangling than, say, the tech industry, but their biggest risk factor may be their own growth. "This is an industry that is safe until Chinese companies start to win, and then they're not safe," said Chris Pereira, the founder and CEO of iMpact, a New York-based consulting firm that has helped hundreds of Chinese enterprises enter the US.
Before he founded iMpact in 2020, Pereira worked as an executive at Huawei, the Chinese tech conglomerate that was driven out of the US market over national security concerns. Having watched that play out, Pereira suggests big Chinese food chains find ways to share profits with American partners as a form of self-protection. For instance, he said, if Luckin Coffee, the Chinese coffeehouse behemoth with more than 22,000 locations in China that plans to come to the US this year, starts to steal market share from Starbucks, "you can bet the US government will find a way to talk about national security for coffee."
In a crowded back office at Quanjude's Manhattan site, Zhang has a more urgent challenge. The visa applications for the five chefs he plans to bring in from China are still pending. Since US-China relations started deteriorating, it's been harder to obtain visas for Chinese nationals, but Zhang says the Chinese-trained chefs are essential for the restaurant. "We won't allow the quality of the food to suffer under untrained hands," he said. If nothing else works out, he plans to bring Quanjude chefs from Canada.
Zhang thinks his ducks could serve an important mission. "I believe food is the best bridge for divisions and it may help pull the US and China closer again," he said.
After a pause, he continued. "Except if there is a hot war," he said, "everything Chinese in the US would be doomed."
Rong Xiaoqing is a New York-based award-winning journalist who has been writing about the Chinese community in the US since 2002.
Read the original article on Business Insider