Over Half of Shenyang’s Coffee Shops Face Losses and Closures

In Shenyang, a city once buzzing with new coffee shops, the scene is changing. Locals like Ms. Zhang have walked into shuttered cafés—first a DIO outlet near Hui Gong Plaza, then another chain on Feng Tian Street—only to find locked doors. It wasn’t until they reached Wen Ti West Road that they found an open café. This pattern reflects a wider trend: many coffee shops in the city are closing or struggling to stay afloat.

More than half of all coffee shops in Shenyang—both franchise and independent—are currently facing losses and considering major changes or closures due to high rents and reduced business traffic.

Rising Rents and Business Shifts Hit Franchise Stores

One recently closed DIO franchise, located near Hui Gong Plaza, shut down in May and still displays a “For Rent” sign. Neighbouring real estate agents confirm the large retail space—operated as a café for around seven or eight years—is now hard to fill. The brand’s corporate office explained that both closed locations were franchises operating under four-year contracts. The exits were due either to rising rents or owners choosing to exit voluntarily. Of the brand’s over ten stores in Shenyang, most are franchised, and overall performance remains broadly stable.

Small Cafés: Low Volume, High Prices

Shenyang’s coffee scene includes three types of outlets: major chains like Starbucks and DIO, independent branded cafés, and small independent or street-front shops. In recent years, many struggling restaurants and teahouses have converted into coffee shops—especially along popular streets like San Jing Street in Shenhe District, where a single block hosts five or six cafés. These tiny venues often sport themed decor and sell coffee at surprisingly high prices: averages hover around ¥20–¥30 per cup. For example, a tiny nine-wei Road café with just five or six tables sells its cheapest brew for ¥20 for roughly 200 ml—a higher per-ml price than Starbucks’ 591 ml drinks, which cost ¥23–¥33.

Pressure Builds: Declining Patronage and Rising Costs

Even operators who once thrived are feeling the squeeze. Mr. Li, who co-owns a franchised café in Hunnan that enjoyed strong early growth due to limited competition, reports a marked drop-off in business clientele over the past two years. Previously, professionals bought large stored-value cards, ensuring steady cash flow. Now, that revenue stream has dried up. Meanwhile, small-shop owners face rising rents. One café on Er Jing Street has seen agreements stipulate 10–15% rent hikes every two years—and fears continued increases may force closure. To adapt, many cafés are adding food items or hosting board games to boost income.

Frequently Asked Questions

How many coffee shops in Shenyang are struggling or closing?

Over half of the coffee shops in Shenyang—including both chain and independent outlets—are currently facing losses and are considering closures or transformations due to rising rents and decreased foot traffic, particularly from business customers.

Why are so many franchise coffee shops in Shenyang shutting down?

Franchise locations, such as those under the DIO brand, have closed due to rising rental costs or voluntary withdrawal by owners. Most of the brand’s stores in the city are franchised, with contracts typically lasting four years, and the exits reflect individual business decisions rather than systemic brand failure.

Are small coffee shops in Shenyang cheaper than chains?

No, many small or themed coffee shops in Shenyang charge high prices—often ¥20–¥30 per cup for as little as 200 ml—making them more expensive per volume than larger chains like Starbucks, which offer bigger sizes for lower cost per millilitre.

What are coffee shops in Shenyang doing to survive?

To cope with declining business traffic and rising rents, many cafés are adding new revenue streams such as offering fast food options or incorporating entertainment like board games to attract more customers and increase sales.

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