China's Food Delivery Giants Compete for "Last Mile" as Consumers Demand Instant Gratification

Chongqing- China's food delivery sector heats up as Meituan, JD.com, and Ele.me battle for dominance, focusing on the "last mile" to meet growing consumer demands for speed and convenience. The competition is shifting from price wars to customer loyalty.

"Last mile" refers to the final step of delivering food from a restaurant or distribution hub directly to the customer's doorstep. Chinese food delivery companies are optimizing this step for speed and efficiency, which shows their strength.

Delivery riders from the platform pick up an order at a Chagee store. (Photo/Zheng Ran)

The race has been heating up since last week, with platforms rolling out second-round subsidies. For example, Taobao Shangou's "Super Saturday" and "188 yuan ($26) mega coupon pack" thrilled consumers, with many sharing their bargains, including low-cost milk tea and free coffee.

An YH.TANG store experiences a surge in orders. (Photo/Xiaohongshu)

According to the China Internet Network Information Center, 545 million online food delivery users are now in the country. Research firm iiMedia Research predicts that the market size will grow from 1.64 trillion yuan in 2024 to 1.96 trillion yuan by 2027.

Delivery giants compete to satisfy instant demand

One key factor behind this fierce competition is China's shifting consumer expectations. Zhang Chenggang, director of China New Employment Research Center, explained, "Short-term growth in food delivery orders will indeed increase the income of delivery riders and others. Once the mindset of instant retail consumption is established, it will also positively affect overall consumption."

The demand for speed has evolved from being a luxury to a necessity. In the past, e-commerce competition has focused on factors such as pricing, product variety, and logistics efficiency, including next-day or even same-day delivery. However, today's consumers are increasingly impatient, with expectations for deliveries to arrive within the hour or even within 30 minutes. 

The need for immediate gratification now stretches beyond food delivery to encompass all types of retail. Whether it's a hot meal, a phone charger, or even large items like air conditioners or furniture, consumers are seeking same-day or even faster delivery times. This shift in consumer behavior has fundamentally reshaped the retail landscape, making speed a core competitive advantage.

Meituan, a long-standing player in China's food delivery market, has become a major competitor in 2025. With its nationwide network and efficient local delivery system, Meituan set a record of 120 million orders on July 5, 2025, the highest in China's food delivery history. By July 12, that number rose to 150 million, with an average delivery time of 34 minutes despite a surge of 30 million orders. 

Meituan's success stems from its ability to scale its delivery network, expanding from restaurant orders to consumer goods like milk tea, apparel, electronics, and appliances. This delivery capability has transformed its network into a versatile retail channel.

JD.com, known for its e-commerce business, has entered the food delivery sector by leveraging its supply chain strengths. On June 18, the company reported 25 million daily orders. By July 8, it surpassed 200 brands with over 1 million orders, including Luckin Coffee and Mixue Ice Cream & Tea.

JD.com's strategy focuses on building a strong delivery network to compete with Meituan. Its goal is "half-hour delivery" for categories like electronics and home appliances. JD.com has also succeeded in attracting consumers who are sensitive to quality, capturing 45% of the premium food delivery market, according to third-party research.

After acquiring Ele.me, Alibaba has positioned it as the backbone of its local delivery strategy, integrating it with its broader e-commerce ecosystem through Taobao and Tmall. This has proven to be a powerful combination, particularly with the launch of Taobao Shangou in May 2025. By leveraging Alibaba's vast user base, Taobao Shangou saw a 200% increase in orders for Naisnow Tea & Bakery on Ele.me.

On July 14, Taobao Shangou and Ele.me jointly announced that they had reached a new milestone of 80 million daily orders, marking an all-time high. Non-food categories have also flourished, with a 100% increase in order volume across 1,205 product categories. The platform plans to invest 50 billion yuan in consumer coupons and discounts over the next 12 months to further stimulate spending.

Catering body urges fair play amid official scrutiny

As platforms continue to compete for market share through subsidies, the cost of these promotions is increasingly being passed on to merchants and delivery workers, creating new challenges in the food delivery supply chain.

Delivery motorcycles are packed with takeout and ready for dispatch. (Photo/Xiaohongshu)

Many small businesses are being forced into the "battle." A franchisee from a coffee chain in Putuo District, Shanghai, said, "Large chain brands usually have high order volumes, but we didn't expect such aggressive subsidies. By 10 a.m., the system auto-accepted orders, and our coffee machines barely rested."

On July 15, the Catering Industry Association of Honghuagang District in Zunyi City, Guizhou Province, issued a statement urging food delivery platforms to end excessive subsidies and unfair competition.

In response, the government has intervened, with the State Administration for Market Regulation urging companies to comply with laws to ensure fair competition and protect the rights of consumers, merchants, and delivery personnel.

Insiders suggest that subsidies aren't the only solution for the food delivery market. The focus should shift to personalized demands and quality improvement, such as creating age-friendly interfaces and expanding instant retail to new services. By segmenting consumer groups, the market could move from a price war to a quality war.