Overseas brands lose their edge? Japan's largest coffee and dessert chain withdraws from the mainland market

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China's coffee and catering market is full of opportunities, but also fierce competition, some overseas brands gradually exposed the problem of disobedience. Mister Donut, Japan's largest coffee and dessert chain, may be pulling out of the mainland market altogether.

Mister Donut has just announced that it will stop business in all 10 stores in Shanghai from March 25. At present, there are only 10 Mister Donut stores in Shanghai, which means that all Mister Donut stores in the mainland will be closed in the future, and the company has not disclosed its next plans.

Mister Donut announced that Mister Donut is a coffee doughnut chain founded in the United States in 1956. In the early years, the company's biggest competitor was Dunkin' Donuts (Donndole). By the 1990s, most of Mister Donut's stores in North America had been renamed and gradually merged into Dunkin' Donuts.

Unlike North America, Mister Donut has been doing well in the Japanese market. It currently has more than 1300 stores in Japan and is the largest coffee doughnut chain in Japan.

The actual owner of the brand is the Japanese group Duskin, which introduced Mister Donut into the Japanese market as early as 1971, then acquired its Asian regional management rights and brand ownership in 1983, and opened Mister Donut to South Korea, China and other Asian markets. At present, in addition to the mainland, it also has 67 stores in Taiwan.

Duskin brought Mister Donut to Shanghai in 1999. In 2004, Mister Donut set up a joint venture with Unified Super to open stores in Taiwan, and in 2009, Duskin also began a joint venture with Unified Super in the mainland market to accelerate store expansion in China. In 2009, the two sides said that they would actively display stores after that, with the number expected to reach 10 by the end of 2009 and 66 in the mainland in 2013.

But it backfired. At present, Mister Donut still has only 10 stores in Shanghai, and the product categories of stores in mainland China are also slow to update compared with the seasonal menus and promotions that Mister Donut updates all the year round. According to SkyEye records, Uni-President Superstore Hong Kong Holdings Co., Ltd. withdrew its stake in 2015, and the largest shareholder of Meishi Donatz (Shanghai) Food Co., Ltd. is Duskin of Japan.

Its competitor Dunkin' Donuts (Donndole) currently has stores in East, North and South China, and Mister Donut can't compete in terms of number of stores or product differentiation.

In fact, both Mister Donut and Dukin' Donuts are in a difficult position in China's highly competitive coffee and catering market.

Starbucks is expanding at an average rate of opening one store in China every 15 hours and sinking to second-and third-tier cities; local Internet coffee delivery continues to burn money to hit the market. Coffee from ubiquitous convenience stores and coffee chains such as McDonald's are even cheaper. If consumers seek differentiation and high-end, boutique coffee shops have long been on the rise.

By contrast, doughnut chains such as Mister Donut find it difficult to differentiate or price advantage coffee in China. At the same time, in the Chinese market, which does not have a doughnut culture, it is difficult for young people to continue to patronize the doughnut menu, which is no different from that of other markets. In the Japanese market, Mister Donut often launches doughnuts and promotions with cartoon IP, as well as a number of local seasonal menus to attract young people.

The withdrawal of Japan's cherry blossom season doughnut Mister Donut reminds other overseas restaurant chains in China to think about what else they have a foothold in the Chinese market if they put aside their overseas aura.