Restaurant industry recovers in June, still below pre-lockdown levels

China’s SME development index rose slightly in June as easing lockdowns improved business conditions for small and medium-sized enterprises. The index rose 0.2 point to 88.4.

Readings below 100 indicate declining economic conditions, while readings above 100 indicate improving trends. 

The monthly index surveys 3,000 SMEs on eight different business conditions including their market outlooks, investment trends, and overall operations.

The restaurant and hospitality industry saw the largest jump among the eight industry groups tracked in the survey, rising 0.6 points to 80.7, but remains below levels seen at the beginning of the year.

While many metrics for consumer demand jumped sharply in June, they remain depressed relatively to pre-2022 lockdown levels.

SMEs in the restaurant industry also report facing pressure on the cost side. According to the survey, prices for imported food continue to rise and are creating inflationary pressures for the companies.