The Foodservice Channel: A Promising Avenue for Food & Beverage Startups
In recent years, many emerging consumer brands have risen through the foodservice channel, including Jiang Xiaobai（江小白）, Dayao Soda（大窑汽水）, CLASSY KISS（卡士）, Lanzhou（兰舟）, and Wang Shanzha（Hawthorn Sparking Water，望山楂）. These brands either fill a market void or "attack where giants cannot defend." Why? Because massive blockbuster products are typically locked into fixed price points, creating opportunities for emerging brands. The foodservice channel, with its higher price flexibility, allows for greater profit-sharing with the channel itself—a strategy traditional blockbuster products from major players struggle to achieve.
Brands like Wang Shan Zha and CLASSY KISS not only sell at higher price points but also sell better. Restaurants are happy to carry them because they align perfectly with the foodservice logic. Restaurants operate within fixed spaces and have limited turnover rates. The best strategy to maximize revenue is to increase per-customer spending, making high-margin beverages an ideal fit.
The potential of the foodservice channel should be thrilling for brands. In 2023, China’s total foodservice revenue reached 5.289 trillion RMB (over 5.2 trillion RMB). According to Frost & Sullivan, the market is projected to grow to 7.66 trillion RMB by 2027, with a compound annual growth rate of approximately 11.8% from 2022 to 2027. By 2022, the chain restaurant penetration rate in China had reached 19%. However, compared to mature markets like the U.S. (54%) and Japan (49%), there’s still immense room for growth. This also presents enormous opportunities for food and beverage brands to create blockbuster products within the foodservice channel.
The foodservice channel has already produced success stories like Hope Water, which achieved over 500 million RMB in revenue and reached 30,000+ distribution points.
Hope Water’s rapid growth in the foodservice channel is closely tied to the unique advantages of its founder, Sun Mengge. As a former restaurateur, Sun brought an extensive network to the brand, boasting over 10,000 WeChat contacts. Since starting her foodservice entrepreneurship journey in 2015, she has accumulated a vast resource pool and seized opportunities by collaborating with new platforms like Hema Fresh, new distribution channels, and emerging restaurateurs, achieving rapid growth together.
However, having resources alone isn’t enough. The core lies in the product itself and the brand. From a consumer perspective, Wang Shan Zha is a drink I personally can’t stop repurchasing. If it’s available at a restaurant, it’s a must-order; at home, it’s always stocked. Whether dining out or quenching thirst at home, I find myself reaching for a bottle time and again. It’s a bit puzzling—even though it’s sweet and somewhat pricey, I can’t help but drink it daily!
On closer inspection, the flavor is truly compelling. Wang Shan Zha’s unique fizzy texture adds a slight graininess that makes you crave another sip. Being a fan of hawthorn and its perceived digestive benefits, I already had a positive mental association. Wang Shan Zha’s combination of hawthorn flavor with carbonation, sweetness, and tanginess is simply addictive—an unbeatable match.
A successful product often starts with a name that resonates emotionally, as if it’s been part of our lives all along.
From the brand name to the product names, Hope Water has crafted an instantly memorable and heartwarming identity: Wang Shan Zha (Hope Hawthorn), Wang Xing Fu (Hope Apricot), Wang Tao Hua (Hope Peach Blossom), and Wang Mei Hao (Hope Plum). These names are catchy and brimming with positivity. It’s remarkable to imagine the creativity and vision required to come up with such delightful names!