On March 7, the reporter noted that Yum China recently released its 2021 annual report announcing the termination of its Chinese fast food brand “East Dawning” (Dong Fang Ji Bai, 东方既白). As of December 31, 2021, there were five East Dawning stores in China, and all of them are scheduled to close permanently in 2022.
The reporter found that the official website of East Dawning only has the words “website upgrade in progress, please wait”, and the phone number to join is empty. According to the website of Dianping, the original East Dawning store in Beijing South Station is also marked as “closed”.
East Dawning, headquartered in Shanghai, opened a Chinese fast-food chain called “East Dawning” in Xujiahui on April 27, 2005. The global restaurant giant Yum Brands announced that this is the fifth major restaurant brand of the group after KFC, Pizza Hut, Pizza Express and Taco Bell, thus Yum entered the Chinese fast food market officially.
The phrase “East Dawning” comes from Su Dongpo’s “Ex-Chibi Fu”, “The guests were happy and smiled, washed their lamps and drank more, the food was finished, the cups and plates were in a mess. We were lying on each other’s backs, not knowing how white the East was.” This is a signboard for Yum’s entry into the Chinese food market, which shows its consistent style of localization strategy. In East Dawning’s stores, traditional Chinese dishes such as rice, congee, noodles, buns and soy milk are available, while rice with preserved plum vegetables and sweet and sour pork are the mainstays.
In its 2021 annual report, Yum China said it decided to discontinue East Dawning operations, citing “the brand has been severely impacted by the COVID-19 outbreak.
“East Dawning is a sub-brand under Yum China, but it has not formed a brand effect and scale effect, the reason behind it is related to its own differentiation ability and innovation is not strong, and the upgrade is not iterative.” Chinese food industry analyst Zhu Danpeng said that Western food and Chinese food are two different systems, across the line like a mountain, “Chinese food is about precise docking, if you use foreign simple standardization of chain thinking to do Chinese food, the effect is certainly greatly reduced.”
Some industry insiders believe that local Chinese fast food chains have developed rapidly in recent years, “central kitchen” “franchising” and other business models are no longer the patents of foreign fast food. East Dawning faces a bigger challenge is that, although it claims to be positioned as Chinese fast food, but the main dishes are really chicken steak, pork steak rice, etc., the category covers breakfast, lunch, dinner and afternoon tea, there is unclear positioning, caught in the embarrassing situation.
In 2012, Yum China acquired the hot pot brand Little Sheep at a price of nearly HK$4.6 billion, adding to its previous stake, Yum China’s shareholding was as high as 93.2%, making a high-profile entry into the Chinese food market. But Little Sheep, once listed in Hong Kong and known as the “No. 1 hot pot stock,” has been “losing weight” and stagnating since it was brought under Yum’s umbrella. The 2021 annual report shows that as of December 31, 2021, Little Sheep has more than 240 stores worldwide, 220 of which are franchised. At its peak, Little Sheep had more than 700 stores.
Yum China’s full-year revenue for 2021 was $9.85 billion, up 19% from $8.26 billion in the same period last year, according to the report. With more than 11,700 restaurants as of Dec. 31, 2021, Yum China has a number of well-known restaurant brands, including Little Sheep, Huang Jihuang, Lavazza, COFFii&JOY and Taco Bell, in addition to the well-known KFC and Pizza Hut. Among them, Lavazza has expanded from 4 stores to 58 stores. Source