---
title: "How Much Urban Youth Love Convenience Stores, Small-Town Youth Disdain Them"
description: "Urban youth increasingly rely on convenience stores for all meals, but this trend may not translate to lower-tier cities due to consumer habits, regional tastes, and financial constraints."
author: "考拉是只鹿"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2023-08-14"
language: "en"
canonical: "https://xinjignxiao.com/en/articles/how-much-urban-youth-love-convenience-stores-small-town-youth-disdain-th-9a69bebb/"
markdown: "https://xinjignxiao.com/en/articles/how-much-urban-youth-love-convenience-stores-small-town-youth-disdain-th-9a69bebb.md"
original_source: "https://mp.weixin.qq.com/s/Z5DeKR38P-Ukum8gOx14TQ"
translation: "https://xinjignxiao.com/zh/articles/%E5%9F%8E%E5%B8%82%E9%9D%92%E5%B9%B4%E6%9C%89%E5%A4%9A%E7%88%B1%E4%BE%BF%E5%88%A9%E5%BA%97-%E5%B0%8F%E9%95%87%E9%9D%92%E5%B9%B4%E5%B0%B1%E6%9C%89%E5%A4%9A%E4%B8%8D%E5%B1%91-9a69bebb.md"
attribution: "New Distribution — https://xinjignxiao.com/en/articles/how-much-urban-youth-love-convenience-stores-small-town-youth-disdain-th-9a69bebb/"
usage_policy: "https://xinjignxiao.com/ai-policy.txt"
---

# How Much Urban Youth Love Convenience Stores, Small-Town Youth Disdain Them

> Urban youth increasingly rely on convenience stores for all meals, but this trend may not translate to lower-tier cities due to consumer habits, regional tastes, and financial constraints.

It was the start of another familiar week. Winnie, suffering from Monday blues, dashed out of the elevator, clocked in just in time, and let out a long sigh of relief as she sat down at her desk. She placed a FamilyMart latte and a FamilyMart rice ball on her desk—her usual breakfast combo from FamilyMart. Eating while working marked the beginning of a proper workday.

"My breakfast is almost entirely provided by FamilyMart," said Winnie, who has a FamilyMart store downstairs from her home and another near her office. "In fact, I often have lunch and dinner there too. Many people in my office do the same."

Living out of convenience stores is becoming increasingly common among young people in first-tier cities. Convenient, quick, cheap, and even somewhat tasty—convenience store meals have become a preferred choice for many office workers.

Recently, FamilyMart launched its fully upgraded fifth-generation store. On July 12, the first fifth-generation FamilyMart store opened on Fahuazhen Road in Shanghai. Through in-depth analysis of consumer needs, FamilyMart divided the day's meals into five segments: breakfast, lunch, afternoon tea, dinner, and late-night snack, fully launching its "Five Meals a Day" strategy.

Compared to fourth-generation stores, the fifth-generation stores have comprehensively upgraded sub-brands such as "Hot Pot Corner" and "Paike Coffee," expanded the "Honey Bakery" product line, created the "EMO Midnight Kitchen," and introduced innovative "DIY Cocktail" services. The new store format has enlarged the fresh food counter and made it a separate area, while also adding services like wireless charging and photocopying.

Image source: FamilyMart

The day before, FamilyMart's official WeChat account released the latest franchise opening information. Combined with this newly upgraded fifth-generation store, FamilyMart, as a leading foreign convenience store chain, has clearly shown its determination to expand and strengthen.

So why has FamilyMart targeted "Five Meals a Day" as a breakthrough? Can this concept be widely replicated across the country? And how should foreign convenience stores operate in lower-tier markets?

**The Soul Lies in Fresh Food**

"If you ask me what I like most about FamilyMart, the answer is definitely the variety and taste of the food," Winnie said, rattling off her favorites. "Other convenience stores have great food too, like 7-Eleven's taro mochi and Lawson's ice cream mooncake. I think the main direction for convenience stores is clear: fresh food is definitely the top priority in the future."

Looking at the current domestic landscape, in first- and second-tier cities, especially Beijing, Shanghai, Guangzhou, and Shenzhen, the convenience store market is dominated by new-generation convenience stores.

Unlike traditional mom-and-pop shops and grocery stores, foreign convenience stores like FamilyMart and Lawson, as well as emerging domestic brands like Bianlifeng, have cleaner displays and more youthful products. But ultimately, what attracts young people most is "fresh food."

Fresh food emphasizes the "fresh" aspect. In Shanghai's first fifth-generation FamilyMart store, in addition to conventional equipment like microwaves and hot dog machines, there are also hot-pressed sandwich makers and self-service noodle cookers, along with freshly prepared hot food selections, emphasizing cooking on the spot. New products like multigrain trio, FamilyMart noodles, and Kang's private beef soup instant noodles are selected to closely match young white-collar workers' demands: healthy, delicious, convenient, and quick.

According to the "2022 Survey Report on Fresh Food Operations of Local Convenience Stores in China" released by IBMG Business Think Tank, in 2021 only 43.8% of convenience stores sold bento boxes, but a year later, that proportion reached 60%.

Why do fresh food?

**On one hand, the core reason is that due to the development of food delivery in the Chinese market, there is an irreversible trend of "restaurant retailization" and "retail restaurantization." On the other hand, compared to regular shelf products, fresh food has been elevated to a new level in terms of both usage frequency and profit margins.**

A report titled "The Next Stop for Convenience Stores" by Alibaba Research Institute and Deloitte showed that Fast Food (FF) accounts for the highest proportion of 7-Eleven's product sales at 42.9%, with a gross profit contribution of 46.6%, nearly double that of other products.

In a standard Zhongbai Lawson store of 80-120 square meters, there are at least three shelves and two groups of multi-temperature freezers, displaying up to 3,000 SKUs. Among them, fresh food co-developed by Zhongbai Group and Lawson, such as oden, skewers, bento boxes, sushi, rice balls, and cakes, occupies about one-third of the store area. These private-label products not only contribute high sales but also enjoy high profits of 35%-40%.

Image source: Zhongbai Lawson Weibo

Convenience stores are not the only ones wanting to do fresh food; the dazzling food sections in fresh food supermarkets already show this.

ALDI, known as the "poor people's supermarket," is positioned in the Chinese market as a community premium supermarket and community canteen targeting the middle class. Its "three meals a day" positioning includes self-operated bakery bread, light meals, German pretzels, specialty salads, and oatmeal cups, all of which have been well received by consumers.

Chen Yougang, Chairman of ALDI China, said: "The biggest potential demand in the community is how to solve the problem of simple eating while also eating well. They can eat in the store or take it home. If retail doesn't actively think about the path of restaurantization, the future space will become smaller and smaller."

**What Hema Can't Do**

"Every time I see FamilyMart's slogan: 'FamilyMart is your home,' I think it's not an exaggeration," Winnie said when asked why she didn't choose a supermarket like Hema to solve her three meals a day.

"It's not that Hema is inconvenient, but for my lifestyle, convenience stores are more suitable. My workplace and home are both near FamilyMart. From a convenience standpoint, FamilyMart wins. Although Hema now has 30-minute delivery, I can just go downstairs and buy food in 10 minutes. Why wait an extra 20 minutes? Also, Hema's delivery service waives the delivery fee only for orders over 49 yuan. As a woman living alone, it's a bit difficult to reach 49 yuan."

Winnie's thoughts are very representative. Although Hema has undergone multiple upgrades, and "Hema district" is no longer a new concept in first-tier cities like Shanghai, there are still limitations. Convenience stores, as the name suggests, aim to achieve the ultimate in convenience.

"For me, another important point is business hours. Because I'm a night owl, I often crave late-night snacks. Hema closes at 9 PM, and there aren't many stores open until late near my apartment, and food delivery options are limited. In contrast, the FamilyMart downstairs is open 24 hours. When I'm hungry, going downstairs to buy oden or a hot dog is the most convenient."

To compete with supermarkets like Hema and Yonghui, convenience stores, which are "doing a lot in a small space," want to reach more people. Therefore, in recent years, convenience stores have been expanding their delivery services. However, **serving consumers within a five-minute walking radius and the post-midnight customer base remain two major advantages that cannot be shaken.**

Of course, **"living out of convenience stores" is not just about buying things.**

"The printer at the FamilyMart downstairs is so convenient! I tried printing photos, and it was fast with good quality. You can print documents, ID photos, etc., for 4 yuan per sheet. Multi-functional convenience stores are more user-friendly and friendly to business travelers. I hope they promote this more!" Many netizens on Xiaohongshu praise convenience stores' value-added services.

Printing photos, copying materials—these seemingly trivial tasks are also essential when consumers need them. Wireless charging, printers, and copiers—these value-added services elevate the convenience index of new convenience stores to another level. Going to print something and buying food and drinks along the way is perfectly normal, and business naturally follows.

Convenience stores are convenient, and supermarkets have a wide variety of goods. Is there a business model that combines both convenience store and supermarket? Historical experience tells us it's entirely possible.

Take Taiwan, China, for example. After more than thirty years of consolidation, independent grocery stores and individual businesses have no room to survive; they can only develop by joining franchise convenience store chains.

At the same time, the two formats of convenience stores and supermarkets have been continuously merging, with increasingly blurred boundaries. Convenience store brands like 7-Eleven and FamilyMart have opened supermarkets locally; and Taiwan's largest fresh food supermarket chain, PX Mart, is increasingly looking like a convenience store.

Image source: PX Mart official website

In the mainland Chinese market, ALDI is very much like an intermediate format between a supermarket and a convenience store. This is not just because its store area is larger than a convenience store but smaller than a supermarket, but more about its positioning. It can provide fresh food similar to convenience stores, as well as packaged fresh products like meat, eggs, and vegetables. However, the main product structure is still various distinctive and differentiated packaged foods and beverages.

Photo by New Retail Business Review

**The "supermarket + convenience store" intermediate format is expected to become a new retail scenario in the future.**

**Small-Town Youth Don't Buy It**

Can FamilyMart's five-meals-a-day model be replicated across the country, especially in lower-tier markets?

To be honest, in lower-tier markets, let alone five meals a day, even three meals a day is hard to achieve.

**The first challenge is consumer education.**

Although convenience store bento boxes and fresh food products have been widely accepted by consumers in first-tier cities like Beijing, Shanghai, Guangzhou, and Shenzhen, in lower-tier cities, small-town youth have not yet developed such consumption habits.

First, income in lower-tier cities still lags behind first-tier cities. What seems cheap to white-collar workers in first-tier cities may not be cost-effective for small-town youth.

Second, in most lower-tier markets, many enterprises and institutions still have a two-hour lunch break. Workers prefer to go to company canteens or local restaurants in groups, and some who live near the company even go home for lunch. There is no need to buy breakfast or dinner at convenience stores. Therefore, at this stage, it is not objectively possible for white-collar workers in lower-tier markets to directly benchmark against first-tier cities.

Third, not to mention that in economically underdeveloped urban and rural areas, there is a larger elderly population, for whom the concept of "living out of convenience stores" is even more unimaginable.

A fierce attack may not work miracles; slow simmering takes time.

**The second issue is regional differences.**

Regional differences are not obvious in first-tier cities. The reason is simple: first-tier cities integrate entrepreneurs and workers from all over the country, and their tastes have been blended through daily work.

Standardized convenience store meals can satisfy their palates, and reasonable dietary combinations even surpass deliciousness itself, with health as the primary selling point to attract repeat purchases.

However, once in lower-tier cities, the primary concern for meals is often being cheap, large, and filling.

Oranges grown south of the Huai River are oranges, but north of it they become trifoliate oranges. On China's vast territory, it is unrealistic to conquer the whole country with relatively uniform fresh food like in Japan. In other words, in different regions, convenience stores need to develop different fresh food offerings.

Understanding the real needs of lower-tier markets and creating localized, down-to-earth products and services is the correct way to expand into these markets.

**The third issue is how much money they are willing to burn.**

As of the end of 2022, Lawson had 5,641 stores nationwide, far exceeding 7-Eleven's 3,319 and FamilyMart's 2,666, making it the foreign convenience store with the most stores. Lawson (China) has stated it will open 10,000 stores by 2025.

Lawson's rapid growth in the past two years has been partly driven by acquisitions, with a quarter of its stores coming from acquisitions—acquiring Chengdu WOWO Convenience Store at the end of 2021 and Shenzhen Tianhong Micro Convenience Store in early 2022. The former had over 300 directly operated stores, and the latter had over 220 stores.

However, behind Lawson's rapid store growth is an equal expansion of losses. In 2020, Lawson China announced its first overall profitability, but unfortunately, that remains its only annual profit to date.

To expand territory, you have to burn money. This has been true since ancient times.

To do fresh food well, from product development to supply chain refinement, every link must be solid. All of this requires money. The more you want to go down-market, the more money you need to burn. Burning money is necessary, but long-term burning is not advisable. Whether you can quickly capture the lower-tier market is a gamble, and whether the first movers will succeed remains unknown.

**Final Thoughts**

While young people in first-tier cities are starting to live out of convenience stores, small-town youth may not think the same way.

The "five meals a day" strategy is not feasible in lower-tier cities in the short term. Different customer groups have different needs. Implementing differentiated operational strategies in different regions is still the most practical approach. And how to win the hearts of small-town youth remains a long and arduous journey for convenience store leaders.


---

## Copyright and AI use

This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL.

Contact: zhaobo258@gmail.com · +86 158 5481 7671