Mainland Chinese food and beverage (F&B) companies are encountering mixed outcomes as they expand internationally, contrasting with recent struggles in Hong Kong’s retail market. While mainland F&B operators accounted for 73 percent of new entrants in Hong Kong’s retail sector in 2025, that figure dropped sharply to 25 percent in the first quarter of 2026. Notably, brands such as dessert chain Fufuland and hand-crushed lemon tea brand Ningji have exited the city, and Mixue, known for its low-cost, high-volume model, has reduced its footprint amid rising rents and labor expenses.

Outside Hong Kong, several major Chinese F&B players have pursued growth with a more adaptive approach tailored to diverse global markets. Chagee, a tea brand, recorded a 139 percent year-on-year increase in overseas gross merchandise value (GMV) in the first quarter of 2026. The Haidilao hotpot operator, managed by Super Hi International, operated 129 outlets outside mainland China by the end of June 2026. Meanwhile, Mixue reported operating 4,467 international stores largely concentrated in Indonesia, Vietnam, and Malaysia, and has recently entered new markets including the United States and Kazakhstan.

These overseas successes have been credited to strategies involving premium positioning, experiential dining, and localization of recipes to suit regional tastes. However, experts caution that early enthusiasm may be driven predominantly by Chinese expatriates, raising questions about sustainable market penetration.

Tony Ke, professor of marketing at the Chinese University of Hong Kong, noted that attracting Chinese customers abroad can facilitate initial market entry but may provide a misleading impression of broader acceptance. “A queue outside a new overseas store may simply show demand among people who were waiting for it to arrive,” he said. Alessandro Buffoli, assistant professor of marketing at the Hang Seng University of Hong Kong, emphasized the importance of returning customers after initial discounts and novelty fade as a better measure of success.

Despite Chagee’s overall GMV growth, its same-store GMV declined by 12 percent year-over-year in the first quarter, and Mixue closed 89 international locations in the first half of 2026 to focus on improving store quality rather than expanding density. Conversely, Grace Chung, a consumer industry analyst, suggested that the notion Chinese brands abroad mainly appeal to expatriate communities “may have to be further verified.” She noted that in cities with substantial student populations, some brands succeed without significant local adaptation.

Elisa Harca, co-founder of marketing agency Red Ant Asia, highlighted broader trends such as the “China maxxing” movement on social media, which is creating new consumer interest in Chinese brands among those without previous cultural ties. She argued that localization is a standard aspect of global expansion rather than a sign of weakness.

Experts agree that effective localization extends beyond taste adaptation to include pricing, store locations, and marketing strategies that do not rely on pre-existing brand recognition. Buffoli pointed out that while Mixue’s affordable ice cream appeals broadly without cultural interest, brands like Chagee must convince customers of the value of premium Chinese tea, and Haidilao needs to make its unfamiliar dining format accessible through clear ordering processes and meal options.

Haidilao’s success internationally is partly due to its service-oriented experience, featuring theatrics like noodle-pulling and localized menu items such as tom yum broth in Thailand. However, Buffoli warned that a brand’s loss of unique identity in efforts to blend with local competition could undermine its appeal.

Ke drew parallels with KFC, which has thrived in China by adapting its menu to local tastes while maintaining its core product. He stressed the importance of positioning, noting that a brand perceived as affordable domestically may be viewed as premium overseas.

Certain categories, including ice cream, fruit drinks, and coffee, may face fewer obstacles in adapting internationally. Buffoli highlighted Luckin Coffee’s entry into New York, suggesting its challenge lies in becoming a habitual choice for consumers. For more complex everyday meals, chains like Yuan Ji Yun Jiao (dumplings) and Yang Guo Fu (malatang) may face additional hurdles.

Operational factors also influence success abroad. Buffoli cited the challenges of food spoilage and waste in dumpling and malatang businesses, suggesting clustering stores near dependable suppliers as a potential solution. Chung added that partnerships with local firms can aid regulatory compliance, such as halal certification in Southeast Asia.

Ultimately, Ke emphasized strategic clarity over logistics. “The more fundamental question is whether the brand understands whom it is trying to attract and why those customers would choose it,” he said, underscoring the importance of targeted positioning in global expansion efforts.