“Pin Hao Fan”: Who Really Gets a Good Meal?
Though the saying “you get what you pay for” lingers in the public consciousness, sparking concerns over food safety, I’ve had my own run-ins—once ending up with two days of stomach trouble after sharing an order of “butter fried rice”. Yet, as one Meituan user put it in a review: “Pin Hao Fan won’t starve you. At just ¥10 a pop, what more could you possibly want?” With Pin Hao Fan making up 10% to 25% of all orders in Meituan’s major cities, the product’s “success” is undeniable.
But I’ve long wanted to know: what exactly fuels the rock-bottom cost of Pin Hao Fan?
I. Bad Money Drives Out Good
It started during a conversation with Brother Zeng, who owns a small café in Shenyang. He explained why his place hadn’t signed up:
“When their sales rep came to negotiate, they demanded we slash the price of an Americano down to ¥6. That’s practically at cost.”
Last year, coffee harvests took a dip and prices rose. Since Brother Zeng insists on using high-quality beans, he simply couldn’t meet the aggressive price cuts demanded by Pin Hao Fan. “We couldn’t in good conscience go along with that. Some others cut corners with cheap, low-grade beans that just don’t taste right.”
I asked him: are there any merchants on Pin Hao Fan who still refuse to compromise on ingredients?
With the characteristic dry wit of a native Northeasterner, Brother Zeng shared a story about a colleague. That café actually used beans just as good as his own. But once they joined Pin Hao Fan, the platform squeezed the price so low that there was zero profit margin. Sure, order volumes skyrocketed—they even briefly ranked second on Shenyang’s beverage sales leaderboard, just behind Luckin Coffee.
“Business was booming, but the till stayed empty. They were on the brink of collapse and are currently looking to transfer the shop,” Brother Zeng concluded.
Leaving the café, I stared at its signboard and silently committed the name to memory. It’s a genuinely good coffee shop, yet on Meituan’s merchant directory, you’d struggle to find it. Without paying for “search ranking” boosts or tapping into Pin Hao Fan’s traffic, it’s buried deep on the last few pages. In that moment, I truly grasped what it means when bad money drives out good.
II. Tech giants’ innovation or small businesses taking the hit?
One day, while eating Xianghe meat pies in Haidian, I noticed that although the shop was listed on Meituan Delivery, it had not joined Pin Hao Fan. When I asked, the owner explained: “I sell a pie for 18 yuan in-house, but on their platform the price is driven down to 10 yuan. Once you factor in the cost of ingredients, plus rent and utilities, you’re basically selling at a loss.” In his view, delivery-only outlets that lack dine-in facilities and rely more heavily on platform traffic might be better suited to Pin Hao Fan.
Yet I found that unless ingredient costs are kept tightly in check, even for delivery-only kitchens with lower overheads, Pin Hao Fan amounts to little more than operating at a loss purely to attract orders. Ms Zhang from Hubei shared on social media that she once ran a delivery-only Huainan beef soup shop. She launched her Pin Hao Fan listings in 2022, but after barely a year of continuous losses, she had no choice but to sublet the premises.
On the surface, Meituan publicly claims that the secret behind Pin Hao Fan’s ability to make food delivery cheaper lies in “technological and business model innovation”. Yet from the perspective of restaurant owners, Pin Hao Fan is little more than another mechanism for Meituan to suppress prices. The service can only attract users with nearby delivery addresses to order the same dishes at low cost by compelling merchants to sacrifice further margins and slash prices.
III. Traffic as a Weapon for Driving Down Prices
A Bilibili user, Ms Mei (IP address registered in Guangdong), explained: “My family runs a restaurant. We joined Pin Hao Fan this year, listing just a handful of dishes: shredded potato with pork, braised eggplant, stir-fried pork, and dried tofu with shredded pork. We net between 0.7 and 0.9 yuan per order. Pin Hao Fan barely turns a profit. But in standard food delivery, if you don’t take part in Meituan’s premium voucher campaigns, you simply don’t get any traffic. Sometimes, you actually pocket less from regular orders than you do from Pin Hao Fan.”
Brother Zeng, who runs a café in Shenyang, also spoke about customer traffic. He has not joined Pin Hao Fan. Aside from refusing to slash prices, another reason is that he has no immediate need for customer acquisition. In this context, “driving traffic” refers to the boost in store visibility and order volume that merchants receive on the main platform after joining Pin Hao Fan. Meituan account managers routinely use this prospect as leverage to persuade businesses to sign up. Yet Brother Zeng’s café is run by just two staff members, who simply could not cope with a surge in orders.
He confided: “If we suddenly sold a hundred extra cups a day, we simply wouldn’t have enough hands to cope. Some smaller shops find workarounds, such as brewing large batches of espresso in advance and storing them in buckets. But stale coffee tastes terrible. To keep customers happy with the flavour, they mask it with extra jam and syrup. It’s all just artificial additives and kitchen tricks.”
In other words, within the standard food delivery market, customer traffic has become severely scarce, accessible only through Meituan’s promotional campaigns. While Pin Hao Fan drives down menu prices, it compensates by granting merchants preferential platform visibility, thereby boosting order volume. The familiar logic of ‘low margins, high volume’ only holds water when margins are actually positive. When profits become razor-thin or turn negative, merchants are left with no choice but to slash costs and cut corners.
I once watched a chef on Bilibili critique Pin Hao Fan, saying: “Young people, do me a favour and stop ordering. It’s for your own good, and for us chefs. We barely have any fresh ingredients left in the kitchen now. Meituan has squeezed us to the point where we’re running out of food to cook!”
It brings to mind that batch of beef tallow fried rice I ordered through the service, which left me battling diarrhoea for two days.
IV. When a Platform’s ‘Moat’ Becomes a Pitfall for Workers and Consumers
At the time, public attention largely fixated on condemning unscrupulous merchants and criticising the platform’s lack of oversight. What was overlooked, however, was that the very ecosystem of these delivery-only kitchens was cultivated by the platform itself. ‘Pin Haofan’ arguably serves as the most direct proof of the platform’s deliberate strategy to manufacture ‘bargain takeaways’.
In reality, the rationale behind ‘Pin Haofan’ needs to be viewed through the lens of the platform’s overarching ‘bargain takeaway’ strategy. Since launching in 2020, the feature has helped Meituan penetrate lower-tier markets, maintain user engagement, and fortify its competitive moat. According to LatePost, 120 million users have tried ‘Pin Haofan’, approaching a quarter of Meituan’s total user base.
Data released by Meituan reveals that peak daily orders for ‘Pin Haofan’ have already exceeded 8 million. Analysis by BOC International indicates that in 2023, total orders reached 1.16 billion, representing 6% of Meituan’s overall takeaway volume. This proportion is projected to climb to 20% in the coming years.
By the first quarter of 2024, as reported by the Zhiwei editorial team, the share of ‘Pin Haofan’ orders had climbed to 10% of Meituan’s total takeaway volume. According to statements made during Meituan’s public earnings briefings, this figure has already reached 25% in certain cities and is anticipated to keep growing.
Behind these steadily climbing figures lies a ‘capability’ forged by Meituan in the course of operating ‘Pin Haofan’: the ability to drive takeaway prices ever lower.
Some argue that there is no difference in quality between dishes ordered through ‘Pin Haofan’ and those on the main platform, with the only distinction being portion size. Others contend that many of these delivery-only ‘Pin Haofan’ kitchens are operated by conscientious, ordinary people. These claims hold a degree of truth.
Yet as a consumer, I cannot help but worry about the choices ‘Pin Haofan’ merchants will be forced to make during actual food preparation under the platform’s relentless pressure:Will they use fresh meat, or clear out frozen cuts nearing their expiry date? Will they opt for crisp vegetables, or use ones that have begun to turn? If a chicken thigh hits the floor, will they sweep it up into the packaging, or cook a fresh portion for the customer?
We cannot be certain whether a merchant’s conscience will hold up against external pressures when forced to choose between survival and shutting down. But there are only two things we can be sure of.
First, as competition between Meituan, Douyin, JD.com and Ele.me in the online local life services sector intensifies, Meituan will increasingly rely on the ‘Pin Haofan’ model and its ability to produce ‘bargain takeaways’ to fortify its competitive ‘moat’.
Second, the food prepared under such duress will ultimately end up on our plates and in our bodies, meaning we will have to bear the brunt of any health consequences it may bring.
V. Can Delivery Riders Keep the Pace?
In reality, because Pin Hao Fan drives down prices not only for merchants but also cuts a few yuan from riders’ per-order earnings, many riders have refused to carry orders up to customers’ doors, sparking conflicts.
As government departments increasingly focus on the safety and welfare of flexible workers and platform-based digital labourers, including delivery riders, platforms such as JD.com and Meituan have announced plans to pay social insurance for eligible riders. Will these promises be kept? And who will foot the bill for this “additional cost”?
If Meituan is ultimately forced to raise prices to prioritise labour protections, merchant margins, and food safety—thereby eroding its “moat”—will it still be able to dominate the market unchallenged? Will consumers and merchants be left with better options?
But whatever the case, a company’s “moat” should never be dug at the expense of consumers and workers.
References
Hongcan Net | Just How Much Profit Can a 10-Yuan Pin Hao Fan Order Actually Make?
Zhiwei Editorial | A 10-Yuan Pin Hao Fan Order Wears Down the Last Edges of Delivery Merchants
2024 Meituan Special Report: Pin Hao Fan, a New Delivery Model, Boosting Efficiency Through Grouping – Report Deep Dive – Futurethink Tankhttps://www.vzkoo.com/document/20240710ace58c49bfa31a306d580736.html
Meituan 2024 Interim Financial Reporthttps://www.meituan.com/investor-relations
One Video Explains Why Pin Hao Fan Is So Cheap? – Bilibili https://b23.tv/rwP6JW6
With Consumer Rights Day (315) approaching, we would also like to know how readers view Pin Hao Fan and the food delivery industry. Feel free to leave a comment to share your stories and perspectives, or scan the QR code to join our campaign: “100 Moments You Dread Ordering Takeout.”
Author: Zheng Yuyang
Editor: Tian Le