Despite the fusion of rural countryside and coffee culture that once made “village cafés” a hot spot for young people in China, the trend of opening coffee shops in rural areas is cooling down as the first wave of young entrepreneurs faces massive losses due to various underlying problems.
According to a report from the WeChat public account “Quickblade Finance”, a small county in the Yangtze River Delta region with a population of less than 600,000 – Anji County in Zhejiang Province – has seen over 300 village cafés established as of 2024.
Local government data shows that these “village cafés” annually receive over 6.15 million visitors and generate a revenue of 121 million RMB. In April 2024, a coffee shop under Anji’s “Deep Blue Project” set a national record by serving 8,818 cups in a single day.
This trend of rural café entrepreneurship emerged after the pandemic. Many cafés set up in villages, forests, or old houses, known as “village cafés”, cater to urban consumers’ desires for relaxation, natural experiences, and immersive travel in an “original ecology” environment and “slow living” atmosphere, quickly emerging as a new trend combining cultural tourism and coffee.
However, behind this trend lies a stark disparity between ideals and reality for entrepreneurs.
The report highlights that despite low rural rents, the hidden costs behind “village cafés” are significant. Many establishments rely on renovating old houses, involving reinforcement, waterproofing, electrical and plumbing transformations, with a single investment often exceeding 1 million RMB.
Some shop owners reveal, “What appears to be a simple brick house can deplete all savings just in infrastructure costs.”
At the same time, village cafés heavily depend on peak tourist seasons and struggle to maintain operation during off-peak periods. Many stores become “seasonal part-time” venues, opting to close when visitors are scarce, leading to staff layoffs.
One shop owner candidly admits, “On good days, sales can reach thousands, but during slow seasons, we just wait for customers, and can’t even cover our electricity bills.”
Behind the hype of “village cafés”, the industry’s rapid expansion has exposed numerous issues.
Currently, there are over 40,000 coffee shops in rural areas nationwide, with many establishments adopting a standardized template of “checkered tablecloths + rice fragrance American-style + rural settings” which consumers criticize for excessive homogeneity and lack of cultural and regional identity.
More worrisome is that some shops resort to extremely rough construction methods to cut costs, such as using bamboo poles for shelters, renovating pigsties, or even illegally occupying farmland.
“From a distance, one might mistake it for an outhouse”; others simply paint empty pigsties white, set up tables and chairs for rural dining inside, taking “pigsty coffee” to the next level.
Industry insiders generally believe that village cafés do not primarily focus on “coffee quality” but rather on providing “scene experiences,” “emotional value,” and “photo backgrounds”.
According to “Quickblade Finance”, some establishments price a cup of coffee as high as 68-79 RMB, far exceeding the average prices of urban chain coffees, with varying quality, some even worse than a 2 RMB Nestle coffee. Customers complain about feeling like they are “drinking coffee on a set” and praise the environment but criticize the overall experience.
One visitor wrote on social media, “After a three-hour drive from the city to a mountain-top village café, navigation signal lost, rugged mountain roads, but the coffee tasted bland, queuing even for photos, and the experience fell far below expectations.”
“Quickblade Finance” suggests that industry reshuffling has just begun.
With the decline of capital and traffic heat, the industry is entering the “de-bubbling” stage. In the case of Anji, which once had 500 village cafes, more than 100 have since closed or ceased operations. Industry insiders estimate that less than 30% of stores actually turn a profit.
Experts point out that successful village cafes need to have four core competencies: retaining the “rural essence,” strengthening “unique scenes,” building “emotional resonance,” and achieving “commercial sustainability.” Entrepreneurs who simply replicate profit models with the simple combination of “rural + coffee” without the above elements are facing elimination in the reshuffle.