Amid China’s stagnant economy, decreasing wages, and rising unemployment, young people’s consumer habits have significantly changed. The frugal economy has become the most popular lifestyle in 2024. Young people openly embrace frugal behavior, shifting away from luxury goods and big brands. Instead, they focus on the practicality and value for money of products. A new trend has emerged: the consumption of leftover food mystery boxes. These boxes, sold online at 30% to 50% of the original price, contain nearly expired or unused food and beverages from restaurants. While the contents are not selectable due to limited quantities, they offer an attractive option for budget-conscious consumers seeking affordable meals throughout the day.
On January 24th McDonald’s in various parts of China launched a 10 Yuan double beef burger promotion leading to an immediate crash of their ordering system. The incident widely known as McDonald’s crashed became a trending topic on social media, consumers were complaining about the inability to order online and the rapid sellout at the physical stores by the afternoon of the 24th McDonald’s crashed had risen to the top of multiple social media platforms hot search lists with many users with many users experiencing failure in online ordering around 6:00 p.m. attempts to order via McDonald’s WeChat mini program using Chengdu as a location either showed items as sold out or failed to proceed to the payment page after adding items to the cart with coupons also being unusable. Thefrenzy over the 10 yuan double beef burger reflects the ongoing internal competition within China’s consumer market with large restaurant chains like McDonald’s and Papa John’s engaging in price Wars.
Against the backdrop of China’s stagnant economy decreasing wages and rising unemployment young people’s consumer habits have significantly changed. The frugal economy has become the most popular lifestyle in 2024. Young people openly embrace their frugal behaviour shifting away from luxury goods and big brands focusing instead on the practicality and valuefor money of products. The consumption of leftover food mystery boxes has become a new trend with people using them for all three meals. These were attractive due to the low cost and large quantities, the leftover food mystery box is not literally leftover food but consists of nearly expired or unused food and beverages from restaurants randomly combined and sold online at 30% to 50% of the original price. The contents of these boxes are usually not selectable, due to the limited quantity of leftover food mystery boxes it is difficult to get hold of one.
The peak hours for this food war are between 8 to 10 pm. Some students have shared their experiences of relying on leftover food mystery boxes during his initial tough days in Beijing, discovering a box outside a restaurant he was intrigued and made a purchase finding a variety of items like sushi rolls, salads, snacks and desserts, he spent only 20 yuan for food that would typically cost 100 yuan. Currently App selling leftover food mystery boxes like “Food Magic Bag” and “Fun Little Bag” are popular among young people. A platform specializing in these boxes indicated that their primary customers are young people however some consumers express concerns over the food safety of these mystery boxes. Reports suggest that some unscrupulous businesses are exploiting this popular sales model to offload substandard products. A store employee mentioned that the quality of food in these mystery boxes is not currently regulated by the platform, the quality of the food in the box depends on the personal integrity of the service staff and even their mood on the day. The use of nearly expired food remains a sensitive and gray area in the restaurant industry, with some manufacturers, distributors and restaurant businesses colluding to illegally extend the shelf life of expiring ingredients.
The lack of quality control in these mystery boxes makes it impossible for the consumers to be aware of these gray area practices. As young people’s consumption habits change, the trend of affordable pricing has extended to the bakery industry, due to this almost all high-end bakeries are closing down. According to data from Kanyin 88, over 100,000 bakeries have closed in the past year, as of October 2023, there were 122,000 new bakery openings and 12,100 closures with a net increase of only 1874 stores marking just a 1% growth rate for the National Bakery store count in 2023.
Beyond food, young people are no longer pursuing flashy clothing but rather simplicity comfort and casual styles, even aligning their fashion choices with those of the middle-aged and elderly. Instead of paying high prices for luxury brands, individuals prefer spending their money on making their lives more comfortable.
International Economic Research indicates that the crisis in China’s real estate market is severely impacting the middle class with 70% of family assets linked to real estate leading to substantial wealth loss with each decline in property prices. The collapse of China’s middle class is not only due to the real estate crisis but also linked to the broader economic downturn reflected in the continuous decline of the Chinese stock market over the past decade. Liang Shaohua, former chief compliance officer of a Chinese asset management company, explains that the middle class is experiencing a downturn in consumption, due to the economic downturn he said that for decades the primary means of wealth accumulation for this group during the so-called period of reform and opening up was through real estate. However, the collapse of the economy has led to a reduction in the sources of income, significant depreciation in property values and a loss of liquidity in transactions resulting in the precarious situation for the middle class.
Previously, this group led a superior lifestyle affording annual overseas trips, imported foods, private tutoring for the children, piano lessons for children, extracurricular classes and even planning for their children’s education abroad. But in the current environment the lack of a stable income source and uncertain future prospects have caused these plans to be put on hold. The middle class plays a stabilizing role in societal development, a larger middle class correlates with greater societal stability conversely a decrease in the middle class signifies growing income disparities and an increase in the differences in needs among social groups leading to a proliferation of social conflicts. Currently the inability to afford housing, marriage, child care, health care represents the real life situation of most Chinese people. Observers note that China’s economy is expected to decline further in 2024, the real estate market is expected to face a faster collapse burdened by escalating real estate and foreign debts leading to major problems at a rapidly growing rate and scale. As a result, the living conditions for the general populace in 2024 are expected to become increasing challenging.