New Players Emerge in the Food Delivery Market

In June this year, Richard Liu mentioned at a communication meeting that JD.com's food delivery service would adopt a completely different business model from Meituan, hoping this model could fundamentally solve food safety issues. In July, the first "7Fresh Kitchen" store opened, marking the implementation of this new business model.

JD.com stated that all ingredients at 7Fresh Kitchen undergo strict screening, sourcing only from reputable and reliable suppliers. For consumers, JD's self-operated e-commerce platform represents timeliness and quality assurance. The "JD Self-Operated" label on food delivery services also reduces consumer trust costs. In its first week of operation, the store saw continuous order growth, averaging over 1,000 orders per day.

JD.com's expansion into the food delivery market has been high-profile. The company announced plans to invest over 10 billion yuan in three years to establish more than 10,000 7Fresh Kitchen stores nationwide.

Nationwide, there are only a handful of chain F&B brands with over 10,000 stores, including Zhenxin Chicken Cutlet, Mixue Ice Cream & Tea, Cotti Coffee, Juewei Food, and Wallace, as well as international brands like KFC.

These large-scale chains primarily focus on coffee, tea drinks, and fast food—categories that are relatively easier to standardize and replicate.

For JD's 7Fresh Kitchen, which covers a wide range of Chinese cuisines, opening 10,000 stores will undoubtedly face multiple challenges. If successful, its business model and scale could make it a landmark brand in China's F&B industry.

As early as late 2024, Meituan's "Raccoon Kitchen" began pilot operations, adopting a lighter-asset approach. For example, its Liangmaqiao store has two managers—one overseeing daytime operations and the other handling nighttime safety inspections. Raccoon Kitchen provides stalls for merchants, while Meituan leverages its supply chain to offer wholesale ingredients and a digitalized food safety management system for B2B clients.

On Meituan's app, consumers can view "Food Safety Diaries" jointly maintained by store managers and merchants, including photos of meal prep, inventory checks, and cleaning. Live streams also allow real-time monitoring of kitchen operations. The integrated store model lets customers order from multiple brands in one go, saving both delivery fees and waiting time.

Mr. Ke, manager of an egg toast shop, told 21st Century Business Herald that one key reason for joining Raccoon Kitchen was its cleaner environment compared to other delivery kitchens. "Baked goods easily absorb odors, so we avoid poorly ventilated or unhygienic spaces." He added that Meituan helps monitor store operations and plans to open about 20 outlets under Raccoon Kitchen.

A Meituan representative stated that Raccoon Kitchen aims to improve public perception of food delivery hygiene.

Comparing the two giants' goals: Meituan has opened 10 Raccoon Kitchens, targeting 1,200 in three years, alongside a 100-billion-yuan investment in the F&B sector, including subsidies and live-streamed "Transparent Kitchen" initiatives across 200,000 stores this year.

In contrast to JD's ambitious 10,000-store plan, Meituan's approach is more conservative yet steady, with heavy investment in kitchen transparency.

Both 7Fresh Kitchen and Raccoon Kitchen represent innovative attempts to combat "ghost kitchens" in the delivery industry. Competition drives market economies, and healthy rivalry can benefit consumers with better prices and services while pushing industry standards higher. Amid fierce competition, the hope is for tangible improvements in food safety.