Youhe Closes: The Disappearance of Bakeries

Recent news shows that bakery brand Youhe has closed 31 stores in two years, a figure that’s hard to ignore. Just two years ago, long queues stretched outside its openings; now even its location in Beijing’s Daxing Tianjie has posted closure notices. It’s not just Youhe—the entire sector shed 92,000 stores last year. The average shop lasts only 32 months, meaning for every new opening, six close down.

In plain terms, baking used to be highly profitable, but imported heavy cream prices jumped 40% in four weeks, pushing the cost rate from 61% to 67% and crushing margins. Youhe requires at least RMB 2 million per store. A Guangzhou outlet saw monthly sales drop from RMB 1 million to 500,000–600,000 as its own locations cannibalized each other, while competitors like Holiland and Nayuki crowd the market. Times are tough.

That said, consumers are still buying bread—they just reject the old premiums. Sam’s Club, Hema, and Heytea all sell it; RMB 9.9 factory outlets are pulling community business away. The high-end average ticket has risen to RMB 45, but shoppers now care more about whether the ingredient list is clean. The bakery industry is going through a brutal reshuffle, and only those who tighten details and cut costs will survive.

One broader point: this trend reflects a structural shift in China’s consumer market, where buyers increasingly demand both value and health credentials. As living costs rise and information becomes more transparent, marketing and packaging alone can no longer sustain brand loyalty. Going forward, brands that integrate their supply chains, achieve scale production, and maintain product innovation will hold the advantage.

Original: Bakery Brand Youhe Closes 31 Stores in Two Years as the Industry Loses 92,000 Locations Annually