A Chef Studied How Eating and the City Fit Together in China. That Was the Start of His Business | Great Little Studios

It begins with a closely observed report

Where should a restaurant open in a big Chinese city to pull in more customers? Now that review apps guide diners, does a good restaurant still need to sit on a street front, next to a subway exit, or anywhere in plain sight?

That is a question the Colombian chef Federico Duarte has kept turning over. He once ran a restaurant in Shanghai, and it did not go well at first.

In 2010 he was teaching at the Institut Paul Bocuse, the French hotel and culinary school. Shanghai was hosting the World Expo that year, and the school sent him to run a French restaurant near the Expo site. Going by past experience, he picked what is traditionally a good location: by his account it was close to a subway exit and a main road, and directly across from the Expo's Urban Future Pavilion, now the Power Station of Art.

None of those advantages worked the way he expected, even though he insisted that "the food at the restaurant was good." When he told the story, the audience laughed. He shrugged, his face perfectly straight.

He was telling it at a report launch not long ago. The report, Food and the Megacity: How Technology and Urbanization Are Changing the Way China Eats, was published jointly by IKEA's innovation lab Space10 and the studio Yeast.

Duarte is one of Yeast's co-founders. He argues that in a "megacity" like Shanghai, digital technology — food delivery, livestreaming, e-commerce platforms — is reshaping how people eat: from the near end, what sits in the bowl, to the restaurant-location question he cares about, out to the far end, how produce is grown and supplied. Take restaurants. If review apps are steering where people choose to eat, weighing only the traditional location factors is plainly not enough. And if restaurant owners understood the foot-traffic data those apps generate, it ought to help their business.

Around the effect of "digitization" and "urbanization" on eating and food, the report also poses several questions: "With both cooked food and raw ingredients delivered to the door, what do restaurants and malls have to do to get people out of their pajamas?" "How do Douyin and Moments shape what people eat?" "China has a large population and little arable land — what new technologies are emerging to feed so many people?"

Yeast, the studio that produced most of the report's content, was founded in early 2018. Besides Duarte, its founders are the investor Eric Sun and Simone Rebaudengo, a product designer whose subject is machines, artificial intelligence and how people interact with them. They describe Yeast as a "future food lab," and told QDaily that the lab's "experiments" take the form of research, proposals and ideas about food. The subject they are on now — digitization changing the physical city, and through it how people eat — could turn into a business selling city data to restaurants and hotels.

They do not pitch those ideas to an existing company, though. The company is the thing Yeast "creates." Once an idea is settled, they build a product prototype, put it into the market to test, and look for the right partners as they go. If the company is formally set up, they become co-founders. You could call the model a kind of incubation.

On the subject of "designing your own company," Eric Sun said it is a change of role for him: "I used to invest in other people's companies. Now I want to create my own." He studied economics at university, and before founding Yeast was a founding partner of BitsxBites, a food-technology incubator in Shanghai.

Duarte changed roles too. The restaurant near the Expo site was his first job after arriving in China, and he was both head chef and teacher there: the other cooks were his students from the school in France. Later he spent a stretch doing restaurant-management training, then opened the food consultancy Mill, where most of the work was food and recipe design — close to his own trade as a chef.

In 2017, Mill helped the Italian businessman Massimo Reverberi design a silkworm-pupa "crisp." Reverberi was set on building an insect-protein snack business in China, but various constraints left silkworm pupae as the only available raw material. Mill's answer was to fry the pupae into thin wafers, avoiding the heavy texture and the off smell, to suit Chinese tastes.

Duarte takes food and eating seriously, close to obsessively. "I don't think food is a commodity, or just something to fill people up — at least a restaurant shouldn't play that role. Chefs and restaurants both need to tell the story behind the food." It also saddens him that his daughter thinks "fish come from the supermarket, not the sea." Even though ingredients now arrive by courier easily enough, he often takes her to the traditional wet market near their home, "so she can be in touch with food better."

He particularly dislikes kitchen machines that let people cook fast. "You spend one minute a day cooking — what do you do with the rest of the time? That spare time only cuts you off from food further, makes you even less aware that fish come from the sea." He wants to do something to keep people in the kitchen longer, handling food and finding new things to do with it.

He soon found a way to act on the idea. While building his own business he came into contact with the food-technology incubator BitsxBites, and met the other two founders there.

So far Yeast's three founders have spent most of their effort on the subject of this report: how digital technology affects the cities people actually live in, and through them what those people eat. To carry the questions they care about further, Yeast worked with IKEA's Space10 on this survey of how eating is changing across China's megacities.

The report is also two months' worth of distillation of what the three founders learned from investing and building companies. In the first month they split up by strength and interviewed people in the fields each knew. Duarte went to restaurant owners and food designers, starting from the basic details — how many delivery orders they sent out, when customers came in, the biggest problem in running the place. Sun observed and summarized the food supply chain, asking about changes in production and retail. Rebaudengo interviewed data and technology specialists. In the second month, writing the report, the three set down what they had each seen, gathered data reports other people had produced, and boiled it all into trends.

They then handed the report to SPACE10, the research center IKEA funds, which helped revise, edit and publish it. Through innovation experiments and prototype testing, SPACE10 proposes future directions and possible answers for IKEA, some of them radical and not necessarily achievable right away. Its questions circle the goal of improving city life, and new ways of producing and distributing healthy food are among the most important of them — the eight meatballs it once designed, for instance, or the Algae Dome, a structure for growing new edible microalgae.

To put the report's contents on the page, Yeast worked with Lantos, a food visual-creative studio in Beijing, on a set of "eating city" illustrations sketching how food is eaten, produced and sold in a digitized city, with some imagining of the future added in.

What the report observes is "how people eat in megacities of more than 10 million," though the three founders' own experience is concentrated in Shanghai. It ends with 12 trends, some of them already well developed in the industry. We have grouped them as follows:

Food delivery has become the norm, and it is changing restaurants, shops and cities

1. Delivered food is taken for granted; fast food no longer just means instant noodles

Yeast treats food delivery as the most important trend in eating in China today, above all in the first-tier cities. As the range of food that can be delivered widens and the area it can reach grows, it is changing what people eat, when and where they eat, what restaurants look like, and the face of the city and its traffic.

Yeast and Space10 put the speed of the Chinese delivery industry down to urban population density, plus low prices and high demand. That has freed people in China's first-tier cities from taking their convenience meals in traditional forms like instant noodles.

2. "Dark kitchens" — delivery-only, with no place to sit — have appeared, judged mainly on user reviews, filling in the cheap-rent pockets of residential districts

The popularity of delivery has produced a new kind of restaurant: no tables, no chairs, no diners, just a kitchen making food to be sent out. The location a restaurant needs to attract customers stops mattering, the space it needs shrinks, and it can move to a cheap part of town.

Where these production-only restaurants cluster, they change the look of the street and the city around them, turning the area into a food dispatch center with platform riders threading through it. By the report's observation, in Shanghai such areas tend to sit about three kilometers from a main commercial street while staying close to housing — the city's "in-between zones," where rent is cheap. By the logic of traditional retail these spots hold no advantage, but they make convenient distribution hubs.

The report argues that digital business is reshaping the physical city this way, and the result may be streets with no cultural variety. As the format spreads, distinctive neighborhood restaurants and grocery shops thin out, and in their place cluster identical-looking dark kitchens and cafés with little foot traffic.

3. Delivery is changing how shops and restaurants design their space

Restaurants and cafés now have to design their premises for online delivery orders and for people eating in, and sometimes they weight the former more heavily. The report takes Luckin Coffee as its example: the chain has physical shops, but orders come mainly through the app, which turns each shop into a dispatch center for online orders. The brand in fact has four shop formats — flagship stores, relax stores, pick-up stores and delivery kitchens. The largest share are pick-up stores, which handle both self-collection and delivery; next come the delivery-only kitchens and the relax stores where you can sit and eat; flagship stores, with the most seats and the best suited to dining in, are the smallest share. The shops, pick-up stores above all, also tend to be sited near offices and office towers for easy delivery and collection, and the core commercial districts are no longer the first choice.

Freshippo is the report's other example, again for the way its floor space combines offline retail with delivery. It leads with "new retail": an offline fresh-food supermarket with a counter that will cook the ingredients you have just picked out, and a delivery service at the same time, describing its own business as "dining + supermarket + app e-commerce + logistics." In April 2018 Freshippo opened stores at scale in ten cities, and rather than take the traditional gourmet-supermarket route of seizing the central commercial districts, it chose sites around large residential compounds where residents spend at the middle-to-upper end.

4. Shops and restaurants need new reasons to get people out of the house, and in-store "experiences" are multiplying

The report cites the Starbucks Reserve Roastery that opened in Shanghai in December 2017: a "coffee wonderland" built for a "full-sensory coffee experience." Two floors of the shop display the roasting and brewing of coffee, in ten set pieces including a "tasting bar," "coffee symphony pipes" and a "coffee library." The equipment is designed to be walked around; the most conspicuous piece is the copper cask in the middle of the room, carved with more than 1,000 Chinese seal designs.

Yeast and Space10 argue that because megacities are so dense in both people and buildings, living space is shrinking and demand for a "third space" is rising. They quote IKEA's Life at Home Report 2018, which found that in digitized cities people's sense of belonging is bound up with community life: the place people call "home" is not only the indoor space they live in but needs settings for socializing and the experience of the world outside.

Meanwhile, community supermarkets and corner shops are being pulled into the e-commerce network

Neighborhood supermarkets and small shops used to be small and independent, often run by a family; residents nearby could buy grain, oil and snacks there, sometimes fruit and vegetables too. Now the "new retail" arm of the e-commerce platforms has taken an interest in them and drawn them into a digital network. A good share of the people these shops used to serve were elderly people or children with no exposure to the internet — which is exactly whom the platforms are aiming at, and what separates these "little shops" from the newly opened delivery-focused fresh-food shops and cafés.

Alibaba's Tmall Xiaodian and JD.com's JD Convenience Store are in this business. The e-commerce companies take part in running the shops and provide supply-chain support, and the shopkeepers restock through the platform Tmall or JD.com provides. The platforms can often also use data to estimate demand in the surrounding blocks and target what they send: near a school they will recommend popular snacks and stationery; where a lot of nearby customers keep pets, dog and cat food. The shops are managed as a standardized brand down to the fittings and the retail experience, which is how smart shelves came into fashion.

5. Street stalls are in decline, which has to do with urban redevelopment and the rise of the middle class

Grilled skewers, jianbing and other street food used to be ordinary in Chinese cities. New zoning that comes with urban development, food-safety enforcement and fast commercial growth are steadily thinning the stalls out. Faced with this, some vendors work out their own solutions. Space10 and Yeast came across a xiaolongbao shop that redevelopment had suddenly walled off: customers could no longer use the old door, so they took their food straight from the kitchen through a window on the other side, or rang the bell and came in the back.

Architects and designers are thinking about the problem too. The report cites a summer design program called "Design H(ij)ack", which gathers architects and designers to discuss what design and art ought to be doing in public space that changes this fast.

6. Unstaffed and robot service in restaurants is spreading

QR codes and mobile payment brought the most immediate experience of automation, and different forms have branched off it. The traditional vending machine became convenient in the process — no more saving up coins to pay — as with the fresh-squeezed orange juice machines in malls. That vending format gave rise to convenience stores and cafés with no staff at all: both JD.com and Alibaba tried unstaffed convenience stores in 2017, with the customer playing cashier. The format has spread to conventional supermarkets as well.

How produce is grown and sold is being remade

7. Demand is growing, and it is driving new ways of growing produce

Raising the efficiency with which vegetables and grain are grown and harvested, to meet rising demand for food and to deal with environmental pollution, is a long-standing goal, and technology has developed in answer to it. Yeast and Space10's report sets out figures on the state of Chinese food consumption and farming. In 2013 the average person in China ate 348 kilograms of vegetables a year, three times the American figure of 114 kilograms. China's terrain keeps farms small — 90 percent of them are under 2.5 acres, about 1.01 hectares — which makes the industrial techniques the United States uses on large fields hard to apply here. On top of that, a growing urban population and a shrinking rural one are pushing up the cities' demand for food.

The report lists several attempts at new growing technology, among them vertical farms and plant factories, both of them ways of producing food inside the city, using technology to release plants from their dependence on natural conditions so as to use land efficiently and cut transport costs.

8. E-commerce has given rustic local specialties and small eateries room to survive, and sometimes made them popular

This one is relatively mature, so we will not go into it further.

9. Livestreaming links country and city, and farmers use it to promote what they grow

Short video and livestreaming have become a new channel for commercial exchange between rural and urban residents. Farmers acting as suppliers, and the e-commerce platforms with them, are trying to use it to let consumers feel the food supply chain is transparent, and so win their trust.

What draws more attention still are the videos on livestreaming social platforms like Douyin. Farmers can film their daily work there and build a persona. A city dweller who comes across one of them can watch and like the life being shared purely as entertainment, or leave a comment, chat, and ask for a live tour of the chicken coop, the fields, wherever the work happens.

Social networks and review sites decide what people eat and how

10. Influencers and livestreams lead food trends, overturning the ratings of established authorities

Friends on social networks, influencers, and the rankings and scores on review apps are now the main basis on which people pick a restaurant or a dish; guides and recipes from high-end institutions, or recommendations professionals write in the press, are no longer the only information people believe.

Cooking apps clearly shape what ingredients people choose and how they cook. Take Xiachufang: a user who knows what dish they want and searches for a recipe sees the recipes other users have uploaded, ordered by likes. The app's home page also recommends novel, easy recipes, which may free what people cook at home from the limits of regional or family habit.

Beyond review apps, all sorts of other programs play a similar part, and what tips people's decisions is often a popular user or an influencer with a following. Douyin and Weibo are both examples; going to an influencer-endorsed restaurant to "check in" could hardly be more ordinary. It has naturally become a marketing tool for businesses as well: an influencer's endorsement, tasting or review can make people notice a restaurant tucked in a corner of a mall, which the traditional logic of restaurant siting could never do.

11. Social networks lead people to invent new ways of eating, and even new tableware

The report cites Ms Yeah, who became famous for office-cooking videos like "hot pot in a water cooler" and "frying an egg pancake on a computer case." It is hard to say whether anyone really copies how she eats, but the reach of video bloggers like her is growing. The "Douyin way of eating at Haidilao" even produced a "Douyin Haidilao menu" circulating on social networks; and CoCo launched an "influencer combo" after someone on Douyin recommended particular ingredient combinations for its milk tea.

12. Cooking and eating together at home matter again — because young people eat out so much, a meal at home has become a "ritual," and high-end tableware is turning toward home use

Space10 and Yeast argue in the report that home cooking has not died out for today's office workers and young people; it has changed roles. Eating at home with colleagues or friends is one of the moments most often shared on social networks, precisely because it does not happen often, which makes it special, even a "ritual." The intimacy of a home makes for a different environment for talking, and people may choose to invite friends over to eat at moments that matter.

The report offers the Haochushi app as evidence of how much people value cooking at home. It used to run a chef-to-your-door service, sending a cook to people who could not cook or did not want to. The company's website shows it stopped operating in November 2018.

Yeast and Space10 also interviewed Pan Xiaoyue, founder of 321 Cooking, a company that used to sell part-prepared ingredient kits to cut down the steps of cooking at home. That company suspended operations in December 2018 too; the notice on its official account read: "The pitfalls of fresh, part-prepared food are more than words can cover, so we'll leave it there."

On the report, and on eating and food now, we talked with Yeast's Federico Duarte and Eric Sun about a few other things:

Q: QDaily,

S: Eric Sun,

D: Federico Duarte

Q: How do you eat on an ordinary working day?

D: This office has a rule against ordering delivery. One reason is that we think it isn't environmentally sound, because it creates a lot of unnecessary waste. The other is that we firmly believe the good ideas come when we're sitting around a table eating something good, and that needs a setting different from the office. So every day we go to a different restaurant, and sometimes we cook ourselves.

Q: Malls are filling up with businesses that deliver food. What do you think mall space will become?

D: Cities are dense, so people's homes get smaller. People won't go to a mall for something they can buy online. They'll go for an experience, a bit like going to a theme park such as Disney. So malls will become "experience centers," which is the one thing e-commerce can't deliver to your door.

What we see now is that some of the restaurant floors in malls have hardly any customers but plenty of delivery riders. I think some company will solve that in the future. Real estate that expensive turned into a delivery dispatch center makes no sense. It will move to cheaper areas, which makes more business sense.

Q: When the report discusses "experience" and the "third space" in shops, you mention Chinese convenience stores — someone called them "a public private space that soothes an empty stomach and an empty soul." What do you make of convenience stores in China?

D: I go to them regularly, and I think watching them turn into a social space is interesting. I see more and more people hanging around convenience stores, young people especially. I think that's a business opportunity too: making these places more than a convenient shop, giving them a "convenience-store experience."

I grew up in Colombia, and the convenience store mattered enormously then, not because it was convenient but because it was what held a community together. It's where you drank beer as a kid too young to be let into a bar, and where you heard the gossip about who in the neighborhood was dating whom. Seeing how young people use convenience stores now makes me think it could be much like the way we used to meet and socialize. I think there's a chance to rethink what a convenience store is for.

Q: The relationship between intelligence, machines and food is a subject you've always followed. What role do you think artificial intelligence and robots will play in kitchens and restaurants in the future? What will their relationship with people be?

S: More and more technology will be applied in every field; that's unavoidable. Will you see machines in the kitchen? There are already machines in the kitchen — a lot of kitchens are essentially one machine. Will we see robots? We need to think about how we define a "robot." If a robot means the kind that looks like a person, has arms and legs and can walk around, I don't think we'll really use one; it needs a very high level of intelligence. In the 1950s our picture of the future was a "robot" doing the housework in the kitchen, but what we actually have is a dishwasher.

So I think imagining a robot that replaces people is a bit silly, because what we'll really have is tools and machines, and their role is to help people have a better experience. Technology in the kitchen lets us make food more easily and quickly, and lets us make food in ways we never could before. That is what the relationship between machines and people has always been, and there will be no "robot."

Q: What do you think other countries can learn from this report?

S: One main reason we find these Chinese trends interesting to study is that China has so many megacities. A "megacity" is defined as having 10 million people or more within the city, which implies very rapid urbanization. The other reason is how widespread and how dense the digital way of life is in China. We think that as other countries' urban populations grow and the digital services they use multiply, they may go through some of the same things we are seeing in Shanghai right now.

Q: (to Federico Duarte) If you had another chance to open a restaurant, what would it be like?

D: (laughs) I'd open a very small restaurant, no more than ten seats, open one day a week, taking only interesting people I could sit and talk with. Probably in a house down a lane, nothing very commercial. From my experience running restaurants and cooking, one big problem is that I always had so much outside pressure, and in the end I was working for my landlord and my suppliers. So if I had another chance, I'd relax more, and really let myself enjoy it.

Cover image from pixabay; banner by Lantos, provided by Yeast, cropped; long lead image from Steve Daniel via Unsplash, cropped.