Core Insights - The article draws parallels between the challenges faced by Chinese restaurant chains and the historical experiences of Japan's dining industry during the "Heisei Era," suggesting that the lessons learned from Japan's past can inform the future of China's restaurant sector [5][6]. Group 1: Economic Context - Japan's "Heisei Era" began in 1989, marked by a GDP growth rate of 5.4%, which was never reached again in the following thirty years [7]. - The economic bubble burst in Japan led to a significant decline in wealth across various sectors, yet the restaurant industry managed to survive, with food and beverage consumption stabilizing between 23%-25% despite the economic downturn [8][10]. Group 2: Shifts in Consumer Behavior - The average monthly food expenditure in Japan decreased from 82,000 yen in 1992 to 74,000 yen in 2000, while other consumer sectors experienced sharper declines [10]. - The rise of "middle food" (convenience store meals) tripled during this period, indicating a shift in consumer preferences towards quicker, more affordable meal options [12][13]. Group 3: Industry Transformation - The Japanese restaurant industry faced a transformation rather than a survival crisis, with a 20% decrease in average meal prices over two decades [10][12]. - The number of restaurant establishments in Japan fell from 1.55 million to around 1.4 million, despite only a 1%-3% drop in demand, highlighting a significant supply-side contraction [15][16]. Group 4: Industry Consolidation and Capitalization - The late 1990s saw a wave of horizontal mergers in Japan's restaurant sector, driven by a "community of interest" mentality, leading to increased chain restaurant prevalence [19][20]. - The restaurant industry experienced a capital wave, with over 100 companies going public, making Japan a leader in restaurant capital markets [20]. Group 5: The "Impossible Triangle" - The article discusses the "impossible triangle" in the restaurant industry, where high pricing, chain operations, and quality cannot coexist [25][29]. - Successful restaurant chains in Japan often focus on standardization and pre-prepared meals, which allow for scalability but limit pricing power [25][34]. Group 6: Case Studies - The return of the chain Watami to China illustrates the challenges of maintaining high pricing in a competitive market, contrasting with the success of companies like Izakaya, which focused on affordability [28][31]. - The majority of Japan's top ten restaurant companies are "affordable representatives," emphasizing the trend towards value over high-end dining [31][32]. Group 7: Lessons for China - The article concludes that the Japanese experience suggests a need for Chinese restaurants to choose between scale and premium pricing, as attempting to achieve both often leads to failure [34][38]. - The differences in food supply and culinary practices between Japan and China indicate that the latter's restaurant industry faces unique challenges in standardization and scalability [37][38].

Group 1 - The core argument of the article is that the challenges faced by Chinese restaurant chains today mirror the historical experiences of Japan's dining industry during the Heisei era, suggesting that lessons can be learned from Japan's past [2][3][46] - The Japanese economy entered the Heisei era in 1989 with a GDP growth rate of 5.4%, but this was followed by a prolonged period of stagnation and economic challenges [4][5] - The Japanese dining industry, despite facing economic downturns, managed to maintain a stable food consumption ratio, indicating that food remains a fundamental need even in tough times [6][8] Group 2 - The article discusses the transformation of the Japanese dining industry post-bubble, highlighting a 20% decrease in average dining prices over two decades and a shift towards convenience foods [9][11] - The supply side of the industry saw a significant decline in the number of restaurants, dropping from 1.55 million to around 1.4 million, despite only a slight decrease in demand [18][20] - The concept of "impossible triangle" in the dining industry is introduced, where high pricing, chain expansion, and quality cannot coexist, leading to a choice between scale and premium pricing [35][44] Group 3 - The article contrasts the strategies of two Japanese restaurant chains, Watami and Izakaya, illustrating how one failed due to high pricing while the other succeeded by maintaining low prices and high volume [36][39] - It emphasizes that successful restaurant chains in Japan often focus on standardization and pre-prepared meals, which allows for scalability and capital investment [32][29] - The article concludes that the Japanese dining industry has diverged into two paths: one pursuing capital scale through affordable options and the other focusing on high-end dining without seeking expansion [48][57]