As prices in the United States surge, low-cost Chinese brands are gaining popularity among young consumers. Chinese companies are expanding their influence not only in toys, coffee, and ice cream, but also in sushi and green tea markets long dominated by Japanese firms.
According to Nikkei on the 28th (local time), Chinese toymaker Pop Mart plans to open a large store on Fifth Avenue in Manhattan, New York. Pop Mart sells the globally popular character "Labubu." The new location is right next to Austrian jewelry brand Swarovski.
After opening its first U.S. store in 2023, Pop Mart now operates more than 70 locations in the country. Until now, it has focused on suburban areas, but it plans to target central New York locations such as Fifth Avenue and Times Square. Pop Mart's sales in North and South America last year rose more than sevenfold from a year earlier to 6.81 billion yuan (about 1.3 trillion won).
Laura Pan, a lecturer at SDA Bocconi School of Management in Italy, said, "Times Square is highly visible and has heavy foot traffic," and noted, "It is a good place for Pop Mart to raise awareness of its stores and spur impulse purchases."
The reason Chinese brands are growing in the United States is prolonged inflation. The consumer price index (CPI) in June rose 3.5% from a year earlier. Nikkei said that especially young consumers tend not to care much about where a product is made if the price-to-quality ratio is good.
In the past, Chinese corporations focused on manufacturing products in factories and supplying them to overseas companies. Recently, however, they are pushing their own brands to directly target consumers in the United States, the world's largest consumer market.
China's low-priced coffee brand Luckin Coffee is also rapidly expanding stores in New York. Luckin Coffee's iced latte starts at about $2. Winnie Tan, who works in New York, told Nikkei, "Starbucks is too expensive," adding, "Luckin Coffee is much cheaper and the service is fast."
Most Luckin Coffee locations operate without seating, with customers picking up their orders. Since first entering New York last summer, about 20 stores have opened. In particular, by opening in former Starbucks locations, it is reducing initial expenses.
Chinese ice cream and beverage chain Mixuebingcheng is also operating more than 10 stores in the United States. With ice cream and drinks starting at $1–$2, it is drawing the attention of young consumers.
Chinese companies are also entering the food and beverage market where Japan has long been strong. In the United States, Japanese-style "omakase," in which chefs compose the menu for guests, has been popular. Customers have flocked to it for the chance to converse directly with chefs and enjoy a special meal, even at $200–$500 per person.
Recently, however, New York has seen an increase in affordable omakase restaurants run by Chinese chefs. These restaurants offer sushi course meals for under $100. Many operators are from Fuzhou, China, giving rise to the term "Fumakase," a blend of Fuzhou and omakase.
Chinese products are also gaining market share in green tea. Harusato Yamazaki, president of Shizuoka-based green tea seller Yamaei, said, "We are expanding our clients to include independent cafes in the United States, but it is difficult to ramp up production quickly," and added, "We are losing the market to Chinese products."