By offering a burger and a coke for as little as 9.9 yuan ($1.39), Tastien has captured the stomachs of China’s hungry youth and along with it, an increasing slice of the country’s $536 billion fast food market.

After opening over 6,000 branches in three years, the Fuzhou-based company is among a handful of Chinese burger chains that have found success by riding the country’s wave of patriotic consumption. Swapping fish filet and beef patty for Peking duck, braised pork and mapo tofu, they also offer cheaper, local alternatives to Western fast food chains like McDonalds and KFC. 

But whether these new joints are just a passing fad or can stake a claim in a competitive industry dominated by legacy brands could depend on factors that go beyond their brand image. 

While the first Chinese fast food chains that emerged more than a decade ago — such as Mr. Lee, Dicos and Wallace — tried to imitate their Western counterparts, these new upstarts have distinguished themselves by embracing Chinese elements in their menu, aesthetic and brand identity, says Giulia Interesse, an analyst at the Asian business consultancy Dezan Shira & Associate.

Besides its creative filings, Tastien is known for its hand-rolled baked buns. With a lion head as its logo, the company became the fourth largest burger outlet in the country last year by touting “Chinese burgers for Chinese stomachs.” By incorporating elements that celebrate Chinese culture and heritage, Tastien is fitting in with the so-called guochao (國潮 or ‘national trend’) phenomenon that has swept through other industries such as fashion and luxury. 

“Tastien’s guochao-infused marketing is a big draw for consumers,” says Interesse. Tastien’s launch of a ‘Chinese burger’ marked a turning point for the company, which started out as a pizza joint in 2012 with lackluster results. One of its three co-founders is Wei Youchun, who ran seven Wallace franchises in the southeastern Jiangxi province before starting his own venture.

Similarly, Pala Hamburger, founded in 1999, has breathed new life into its business by rebranding itself to emphasize its Chinese identity and introducing lu wei fillings – meat braised in dark soy sauce – to its sliders. The well-established Xibei catering group has jumped on the bandwagon by opening a new line of business for burgers, named after its founder, Jia Guolong. It has opened fifty branches in Beijing since March.

But few Chinese brands, even outside of the fast food industry, have seen the same meteoric rise as Tastien. The company received financial backing from investors Buhuo Ventures and Source Code Capital in 2021 for an undisclosed amount, and received a further injection of funds from Hongshan, the former Chinese arm of Sequoia, in November last year, according to Pitchbook.

“Unlike its competitors, such as KFC, who built their reputation in high-tier cities, Tastien strategically prioritized its expansion in low-tier cities first and has only recently entered major cities such as Shanghai,” says Pete Wang, a research analyst at Euromonitor International. The company also uses social media platforms such as Xiaohongshu and Douyin to reach a younger demographic, which accounts for 50 percent of fast food’s consumers.

Tastien has been able to expand quickly in part thanks to the relatively low threshold for opening a new branch, says Yuwan Hu from China-focused market research group Daxue Consulting. Tastien charges franchisees a one-time fee of 452,300 yuan ($63,300), per its website, and requires operators to go through only two to three months of training, both about a quarter of that of McDonald’s. It typically takes a franchisee one to two years to recover their all-in initial investment of about 700,000 yuan (around $98,000), based on several accounts on social media, while Tastien takes a 3 to 6 percent cut of monthly sales above 130,000 yuan ($18,208).

Additionally, thanks in large part to McDonald’s and KFC, China’s restaurant industry has built a modern and mature supply chain over the past few decades, says Alan Lou, executive director of the consulting firm Frost & Sullivan Greater China. “Chinese fast food chains can easily find suitable suppliers that provide standardized ingredients at competitive prices,” Lou says.

So far, Tastien and others have had a limited impact on legacy brands as they target a different consumer base in lower-tier cities. McDonald’s, KFC, Burger King and Wallace made up more than 90 percent of the fast food market in 2022, a report from Zhiyanzhan Industrial Research Institute found. Owned by Yum China, KFC China opened its ten thousandth store this month, and plans to introduce cheaper meals and add another 1,300 branches in the next three years, according to its press release.

[Tastien is] still in the phase of testing the water to see if the concept works well. They have more business questions to figure out year by year.

Yuwan Hu, from China-focused market research group Daxue Consulting

Tastien could come to challenge established brands in future, analysts say. Still, aspects of its operations have cast doubt on the sustainability of its business model.

On its site, Tastien flaunts the story of a mushroom farmer in northeastern Ningde city, whose store brought in up to 400,000 yuan ($55,973) in revenue a month, with a profit of 150,000 yuan ($20,990). But on Chinese social media platforms, some franchisees have shared that they are making only a sliver of that or struggling to break even. 

Guochao is a double-edged sword too. Analysts say consumers expect good value for money from Chinese alternatives, which in turn has put pressure on Tastien to keep their prices low. Already, there has been an online backlash over the growing unaffordability of Chinese fast food. 

As a private company Tastien doesn’t publish its financial statements. According to 36Kr, a Chinese publishing and data company, it recorded a profit of 200 million yuan ($27.9 million) in 2022. Citing a public speech by a Tastien executive in 2021, it also reported that the company is aiming to go public within five years. 

Tastien did not respond to a request for comment. 

“It’s still in the phase of testing the water to see if the concept works well,” says Hu of Daxue Consulting. “They have more business questions to figure out year by year.”

Besides price, food quality is non-negotiable for Chinese consumers. There are signs of trouble for Tastien on this score too.

The brand was embroiled in a food safety scandal in late October, after customers in Nanchang of Jiangxi province found raw chicken in their burgers. This month, a branch in the city of Zaoyang in Hubei province was fined 20,000 yuan ($2,800) after a customer bit into a piece of plastic wrap in their bun.

Failure to ensure standards is the main reason why many Chinese franchises have eventually collapsed, Lou says. One example is Zhengxin Chicken Fillet, which ran over 25,000 stores at its height in 2021; nearly half shut down by December last year, after its fillets fell out of favor. 

As its popularity has already inspired knockoffs — some of which even opened along the same street — Tastien will also have to take more action to combat copyright infringements and defend its trademark. 

Clips from a Douyin video highlighting the difference between Tastien’s products and a new knockoff brand. Credit: 想开千店的大白 via Douyin

Whether its overall business will endure depends on whether it can strike a balance between rapid expansion and management, and keep improving, says Lou. “Afterall, it took KFC and McDonald’s nearly a century of development to reach the success they have today,” he says.

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