---
title: "Report | Self-Heating Food: The \"Rising Wave\" of the One-Person Economy"
description: "In May 2020, three companies in the self-heating food sector—Mo Xiaoxian, Zihaiguo, and Shizuren—announced successful financing rounds, marking a high point for self-heating food. This report explores whether this is merely a pandemic-driven surge or a result of new consumer groups and communication channels, and analyzes the characteristics and opportunities of this emerging category."
author: "爱观察的"
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published: "2020-06-01"
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# Report | Self-Heating Food: The "Rising Wave" of the One-Person Economy

> In May 2020, three companies in the self-heating food sector—Mo Xiaoxian, Zihaiguo, and Shizuren—announced successful financing rounds, marking a high point for self-heating food. This report explores whether this is merely a pandemic-driven surge or a result of new consumer groups and communication channels, and analyzes the characteristics and opportunities of this emerging category.

**In May 2020, three companies in the self-heating food sector—Mo Xiaoxian, Zihaiguo, and Shizuren—announced successful financing rounds, marking a high point for self-heating food.** Is this merely a pandemic-driven surge, or a result of new consumer groups and communication channels? As a rising star in convenience food, what characteristics and opportunities does self-heating food present?

Self-heating food is a sector that Qingtong Capital is currently focusing on, with the latest first-line industry insights. Meanwhile, Qingtong Capital's consumer industry group has conducted an in-depth analysis of the sector from the perspective of consumer goods business logic and the development trajectory of self-heating food, summarizing the unique points of newly established self-heating food companies.

**-01-**
**Five Attractive Points of the Self-Heating Food Sector**

In 2020, the self-heating food sector attracted significant capital attention. **In just 5 months, 4 financing rounds occurred**, including head projects like Mo Xiaoxian and Zihaiguo. Investors include well-known institutions such as Matrix Partners China, Zhonghui Capital, and Jinding Capital. Behind the explosive growth and sustained capital interest, what new consumption habits, brand strategies, and sector advantages are emerging?

What exactly attracts capital to the self-heating food sector? Through in-depth interviews with first-line investment institutions and founders, Qingtong Capital has summarized **five major advantages of the sector**:

> 1) **The price range of 10-20 yuan is currently the main opportunity point for the entire convenience food market.** This is the most concentrated and high-frequency price range for young people's meals, with popular categories including: noodle skins, Luosifen (snail rice noodles), and self-heating food.
>
> 2) **Broad consumption scenarios.** The category includes not only rice but also hot pot, with diverse uses, serving as a main meal, snack, or late-night snack. In terms of consumption space, beyond daily work and life, scenarios like travel also hold great potential in the future.
>
> 3) Self-heating food not only covers the one-person meal market for ages 18-29 but also captures the hot pot consumer group, **solving the awkwardness of eating hot pot alone.**
>
> 4) As an internet-famous product, it has inherent online genes, with obvious advantages in online distribution and advertising, and strong support in the supply chain.
>
> 5) The current market concentration is low. The head players are only Haidilao, Zihaiguo, and Mo Xiaoxian, leaving significant room for development.

On the other hand, **the pandemic catalyzed the development of self-heating food.** According to official data from Mo Xiaoxian, sales increased nearly 400% year-on-year during the pandemic.

**-02-**
**Self-Heating Food Emerges as a New Force, Joining the Four Major Categories of Convenience Food**

Self-heating food belongs to the convenience food sector. Let's first look at the overall market situation of convenience food. In 2019, the **market size of convenience food exceeded 450 billion yuan**, with a compound annual growth rate of 5.7%.

**The four major categories of convenience food are: instant noodles, frozen food, microwave food, and self-heating food.** **Among them, self-heating food has become a rising star.** According to CBNData, in 2019, among convenience foods, the online sales scale of instant hot pot ranked second only to instant noodles, but its growth rate was higher. During the pandemic, self-heating food sales were particularly impressive.

**Convenience food has developed for over 40 years, with market fluctuations.** Among its four major categories, instant noodles and frozen food account for the largest share, with many giants, high market concentration, and limited development space. In terms of overall market sales, **affected by food delivery, sales space has been squeezed.** The largest category, instant noodles, saw sales decline starting in 2014, with a slow recovery in 2017.

**Self-heating food has emerged as a new force, quickly joining the four major categories of convenience food.** Looking at the development of self-heating food, two time points are important. In 2016, self-heating food broke through categories, adding two new products: convenient Maocai and convenient hot pot, and became popular in WeChat business channels. In 2017, self-heating food began to spread widely and attracted capital attention, with Xiaolalong and Tiaotiao Xiaomian receiving financing. **The development logic of self-heating food aligns with the development pattern of new consumer categories.**

Qingtong Capital has summarized that **the rise of new consumer categories in China is generally bottom-up, starting from WeChat business, forming scale and supply chain advantages, and then brands emerge. Domestic beauty and food sectors have followed this logic.**

**-03-**
**Five Industry Characteristics of Self-Heating Food**

After 13 years of development, self-heating food has entered the stage of brand competition. What characteristics do the current sector and consumer groups present?

**1. Rapid Sector Growth, Self-Heating Hot Pot Most Favored**

**Self-heating food is divided into 7 major categories, with the largest being self-heating hot pot. The growth rate of self-heating hot pot can provide insight into the entire sector's development.**

According to data from the China Food Industry Association, **the growth rate of self-heating hot pot in 2018 was 99.6%**, down from 2017 but still relatively high. According to CITIC Securities estimates, under pessimistic/neutral/optimistic scenarios, the future market size of self-heating hot pot will reach 12 billion/30 billion/60 billion yuan.

Qingtong Capital believes that **there are three main reasons behind the rapid growth of self-heating food. First, the customer base is mainly young people, and this category meets their one-meal needs; second, self-heating food meets customers' quality requirements, i.e., healthier and more category choices; third, compared with food delivery, it has shorter waiting time and lower price positioning.**

**2. Catering Enterprises and Newly Established Self-Heating Food Companies Perform Well**

Players in self-heating food mainly include **4 categories: catering enterprises, leisure snack brands, convenience food brands, and newly established self-heating food companies**. Their backgrounds differ, and their approaches in marketing, channels, and R&D vary.

**Catering and newly established self-heating food companies perform well in sales.** According to Taobao data, from November 2019 to January 2020, for three consecutive months, the top four sellers of self-heating hot pot on the Taobao platform were Haidilao, Zihaiguo, Mo Xiaoxian, and Xiaolongkan.

The number of players in self-heating food is increasing year by year. According to Qichacha data, from 2016 to 2019, a total of 36 self-heating hot pot companies were registered, with the number increasing annually: only 8 in 2016, reaching 19 in 2019.

**3. Main Consumers: College Students and White-Collar Workers**

The main consumers of self-heating food are mainly college students and white-collar workers, aged 18-29. According to Tmall 2019 data, **among self-heating hot pot consumers, those aged 18-29 account for 67.36%, and college students and newly employed white-collar workers account for about 50%.**

**This group has two major characteristics: first, they are diligent "lazy people"**, with high demand for one-meal food, requiring simple operation, speed, and appropriate price; **second, they value quality, pursuing health and diverse categories.**

**4. Newly Established Self-Heating Food Companies: More Concentrated Traffic in Online Flagship Stores**

**The online channels for self-heating food are currently mainly concentrated on e-commerce platforms, with a small portion on WeChat business.**

On e-commerce platforms, self-heating food brands generally use agents. The online flagship stores of newly established self-heating food brands perform better than agents. For example, Mo Xiaoxian and Zihaiguo's Taobao flagship stores rank first in their Taobao sales, with relatively more concentrated traffic. For catering enterprises' self-heating food, some online agents can outsell flagship stores.

In terms of offline channel expansion, players with catering or convenience food backgrounds have first-mover advantages. Newly established self-heating food companies are also beginning to reach offline sales terminals such as convenience stores and supermarkets. According to official data from Mo Xiaoxian, as of May 2020, it had over 300 offline distributors, covering more than 100,000 terminal channels.

**5. Production Method: Mainly OEM**

**OEM is the common production method for self-heating food.** According to Everbright Securities data, the OEM price for some self-heating hot pots is 11-12 yuan, while the selling price can reach 26-36 yuan, **with OEM costs accounting for less than 50%.**

The production of self-heating food mainly involves 4 aspects: ingredients, seasonings, heating packs, and utensils/packaging. The OEM factory handles production, and the brand only needs to integrate and assemble. Product quality control is mainly determined by seasonings.

Qingtong Capital research found that the OEM industry chain in China's food industry is mature, which is extremely beneficial for incubating new brands. When a brand has not yet scaled, OEM can meet its production capacity, and building its own supply chain at this stage would actually slow down expansion.

**-04-**
**Newly Established Self-Heating Food Brands vs. Other Players**

There are 4 types of players active in the self-heating food sector, with some brands emerging. Catering enterprises are typified by Haidilao and Xiaolongkan; among newly established self-heating food companies, Mo Xiaoxian and Zihaiguo are prominent; in convenience food, there is Uni-President's Kaixiaozao, but no leisure snack brand has emerged yet.

Through horizontal comparison, Qingtong Capital found that these four types of players each have their own characteristics.

**1. Catering Enterprises: Higher Price Positioning**

Catering enterprises have **offline stores as support, with significant brand and channel advantages.** Haidilao's self-heating hot pot was launched in July 2017, and by the end of 2018, it had over 700 distributors, with approximately 70,000-80,000 corresponding sales points.

However, **catering enterprises' self-heating food has a higher price positioning.** Taking the spicy vegetarian hot pot on Tmall flagship stores as an example, Haidilao sells for 25.9 yuan per box, while Mo Xiaoxian sells for 19.8 yuan per box. Qingtong Capital attributes this mainly to **its brand positioning.**

In contrast, **newly established self-heating food companies have a price advantage**, especially in the 10-20 yuan price range, where they are more competitive. When expanding to third- and fourth-tier cities and lower-tier markets, newly established self-heating food is more easily accepted.

**2. Convenience Food Brands: Lack of Online Genes**

Convenience food brands, such as Master Kong and Uni-President, have first-mover advantages in brand and offline channels. However, their **traditional genes and lack of online experience make it slow for giants to turn around.** In terms of sales, according to Taobao data compiled by Qingtong Capital, in January 2020, Uni-President's self-heating rice sold 80,000 units online, less than half of Zihaiguo's self-heating rice.

Looking at online marketing, convenience food brands react and act slowly. Uni-President's Kaixiaozao invited Xiao Zhan as spokesperson in January 2020. In contrast, Mo Xiaoxian had already placed ads in popular variety shows like "Daughter's Love 2" in 2019 and entered live streaming. **In comparison, newly established self-heating food companies invest faster.**

**3. Leisure Snack Brands: Internal SKU Competition Slows Development**

Leisure snack brands have both online advantages and brand endorsement, but their self-heating food sales are not high. This is mainly because **internal SKU competition is fierce, and self-heating food finds it difficult to obtain resource positions among many SKUs.**

Three Squirrels' self-heating hot pot, with flagship store sales reaching 400,000 as of May 26, 2020, is only 1% of its top-selling pecan product. The main reason is that Three Squirrels has over 600 SKUs, and its Tmall flagship store homepage is long occupied by traditional snacks like nuts and pastries, making it difficult for its self-heating hot pot to gain traffic support.

It is clear that the lack of online genes in convenience food and internal SKU competition in leisure snacks have slowed their development. Qingtong Capital has summarized that **competition in the self-heating food sector will undoubtedly be mainly between catering enterprises and newly established self-heating food companies.** In this contest, within just two or three years, newly established self-heating food brands have rapidly expanded, gained capital favor, and what unique development logic do they have in brand building, channel sales, product R&D, and supply chain?

**-05-**
**How Do Newly Established Self-Heating Food Brands Develop and Break Through?**

The self-heating food sector is still in a window period, with low industry concentration. Newly established self-heating food companies perform prominently. How should players develop? Qingtong Capital research suggests that benchmarking against the development logic of instant noodles can provide inspiration.

Let's briefly review the development logic of instant noodles. **Vertically, instant noodles in China have mainly gone through stages of multi-brand entry, price wars, and giant formation, ultimately leading to high market concentration, with Master Kong and Uni-President becoming stronger.**

**Horizontally, instant noodle brands mainly differentiate through marketing investment, channels, R&D, and supply chain.** In the early stage, high-frequency advertising occupied public mindshare. In channels, they expanded distribution networks, penetrated lower-tier cities, and reached rural sales terminals. In R&D, they continuously expanded categories and flavors. In the later stage, brands improved gross margins by integrating supply chains.

Benchmarking against the formation and development of instant noodle brands, **the self-heating food sector is still in the early stage, with prices not yet affordable.** Currently, newly established self-heating food companies need to focus on four major aspects: marketing investment, channels, R&D, and supply chain. However, times have changed, and the approaches in each aspect have evolved.

**1. Marketing Investment: Live Streaming Is an Important Way to Acquire Young Traffic**

For newly established self-heating food companies, marketing investment is crucial. This is mainly because they started online, and their brands are not competitive in the early stage. How to invest continuously and effectively is a challenge these internet-famous brands must face to survive the lifecycle. **Newly established self-heating food companies prefer channels such as variety shows, hit dramas, live streaming, Weibo, and Bilibili, as they can quickly sense changes in user behavior habits.**

**Live streaming is also an important way for brands to acquire young traffic.** According to iiMedia Research data, in Q3 2019, users under 30 accounted for 80.4% of China's online live streaming users. Since 2019, Mo Xiaoxian and Zihaiguo have entered live streaming and strengthened cooperation with popular anchors, such as Mo Xiaoxian partnering with Li Jiaqi and Luo Yonghao for live streaming sales.

**Currently, marketing tactics are becoming increasingly complex. Newly established self-heating food companies not only focus on traffic but also pay more attention to conversion brought by investment.**

**2. Channels: Downward Market, Developing Special Channels**

**Newly established self-heating food companies have internet-famous genes and are proficient in online tactics.** Qingtong Capital has summarized that **live streaming has become an important sales channel for non-essential consumer goods, achieving integration of marketing and channels.** It not only directly drives traffic from e-commerce but also has good sales results. Mo Xiaoxian, through cooperation with Li Jiaqi, sold 80,000 boxes in 5 minutes.

Additionally, brand flagship stores are also important online channels. For newly established self-heating food companies, flagship stores have more concentrated traffic, and with targeted marketing activities, they often bring better conversion.

**Offline is a channel that newly established self-heating food companies need to focus on developing.** On one hand, they should consolidate the advantage of one-person meal scenarios, refining office and home eating scenarios through product innovation. On the other hand, they should strengthen the development of special channels, entering sales terminals such as tourist attractions, airports, and railway stations, and expanding to third- and fourth-tier cities.

**3. R&D: Rapid Iteration of Categories and Flavors**

**Newly established self-heating food companies are highly competitive in category and flavor R&D, with short innovation cycles and fast product iteration.** According to CBNData, Generation Z is mostly taste-driven consumers, willing to try different flavors and brands, with high novelty-seeking behavior.

In terms of categories, in addition to main products like self-heating hot pot and self-heating rice, newly established self-heating food companies should continuously develop new products such as red oil noodle skins, hot and sour noodles, and barbecue. In terms of price, **launching products at different price points** to always attract different young customer groups.

**4. Supply Chain: OEM in Early Stage, Integration Later**

Newly established self-heating food companies currently mainly use OEM for supply chain, with factories producing and brands only integrating and assembling. When the industry develops to the mid-to-late stage and head players form, giants can acquire or build their own supply chains to meet production capacity and improve product gross margins.

**-06-**
**Summary**

Loved by the 18-29 age group and firmly occupying the 10-20 yuan price range, the newly established self-heating food sector still has significant room for expansion.

The self-heating food sector has low concentration, with only Haidilao, Mo Xiaoxian, and Zihaiguo as head players, leaving room for new entrants. Those self-heating food companies that can continuously build brand influence and rapidly iterate to adapt to consumer needs may bring new variables.

Source: Qingtong Capital (ID: qtziben) Author: Qingtong Capital


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