Food delivery apps in Chinese look to expand

The largest food delivery apps aimed at Chinese-speaking customers are positioning themselves to capture a broader slice of the market in the United States and worldwide as the Asian populations grows.

Several years ago, food delivery apps such as Fantuan, Chowbus and HungryPanda were created to help customers who are more comfortable ordering in Chinese. Today, the apps have millions of users and could be set to grow more.

Crystal Li, PR director at Fantuan told China Daily: “With the US market offering huge potential, our focus remains on expanding our reach and penetration even further.

“Fantuan has over 3.6 million users in four countries, the US, Canada, Australia and the UK … including immigrants, international students, local Asians (for example American born Chinese/Canadian born Chinese), tourists, and whoever enjoys authentic Asian cuisine.”

There are around 120,000 Asian restaurants in the United States. Around 71 percent offer Chinese food, the Pew Research Center found.

More than half of the restaurants are located in five states where there is a significant Asian population: California, New York, Texas, New Jersey and Washington, Pew found.

Asian restaurants were hard hit amid the COVID-19 pandemic amid anti-Asian sentiment in the US. In 2020, the first year of the pandemic, Asian restaurants lost $7.4 billion in revenue, according to a 2023 study by researchers from Boston College, the University of Michigan and Microsoft Research.

As businesses and restaurants in the US and North America attempt to claw back customers post pandemic, many of the food delivery apps are now increasingly being used by restaurants in cities like San Jose, California, Houston and Minneapolis, The New York Times reported.

“They [the customers] seek comfort in the flavors of their hometowns, even while far from home. … Unlike mainstream apps, our platform is finely tuned to their preferences, offering authentic Asian selections that cannot be found on those apps and also Chinese language support,” Li said.

Amid a venture capital-backed push for growth, Fantuan, based in Vancouver, closed a $40 million Series C funding round in December. It was done specifically to get into the Asian food delivery market and provide services for its global customers.

Meanwhile, HungryPanda, a UK-based app, raised $220 million in capital since 2019.

There are approximately 40 million Asians in the countries where Fantuan operates, with a market size of over $36 billion.

With an estimated 2.38 million Chinese in the US alone, the population has grown rapidly from 2010, when there were 1.8 million. Analysts suggest that this market will generate a huge customer base for all kinds of businesses.

“The Asian [population is] certainly increasing in size,” Professor Richard D. Alba, an American sociologist, a distinguished professor emeritus at the City University of New York and at the sociology department at the University of Albany SUNY told China Daily.

Additionally, the largest number of overseas students — 300,000 — who are studying at American universities were from China as of 2022, according to US State Department figures.

To cater to this demographic further, the apps are making key moves to position themselves to not only tap into the Asian food market but also generic US restaurants in the future.

In January, Fantuan acquired Chowbus’ delivery business. Li said that the acquisition “will solidify Fantuan’s leading position in the US Asian delivery market by bolstering our market share”.

Fantuan is also offering online grocery delivery and errands services in a few major cities, the company said.

Meanwhile, Chowbus, which offers delivery services to more than 20 cities in the country, ventured into providing restaurant management software and has 1,000 restaurants as clients. Since 2022, it has raised $40 million.

Linxin Wen, founder and CEO of Chowbus, said in a statement that the company’s main goal was to assist North American restaurants, “especially those owned by newcomers to the country, who generally need help with technology and marketing”.

Li said that another key aim from the acquisition of Chowbus was to “collaborate with even more momand-pop restaurants and businesses and provide a more comprehensive back of house solution for merchants”.

It wants to be like an “overseas Meituan”, Li said.

Across the pond, HungryPanda is the largest overseas Asian food delivery platform; it works with 60,000 merchants and serves more than 3.5 million users worldwide.

HungryPanda operates in more than 80 cities in 10 countries with room to grow..