As the Economy Slows, China Turns Into a Paradise for the Frugal.

There is not nothing good about an economic slowdown or consumer downgrading. Yet after being bombarded with apocalyptic forecasts about China’s economy by major global think tanks over the past three years, Chinese people have finally learned how to find a small pothole to curl up in and make peace with this harsh reality.

One unexpected boon of the slowdown is the incubation and mushrooming of warehouse-style discount stores that have crawled into every corner of the city. They are rising to meet the surging demand for a high-value-for-money consumption pattern, a survival mechanism shaped by an environment where money and opportunities are becoming increasingly scarce.

Hotmaxx（好特卖）has quickly risen as the go-to destination for everyday snacks, becoming an epitome of the broke-consumer era. For many Chinese who are feeling economically squeezed, these stores offer the emotional comfort of finding the best bargain at the lowest possible price, a tiny lift in mood achieved through affordable biscuits, breads, yogurts, chocolates, and other small pleasures.

credit: Xiaohongshu

The business model thrives on a radical shift in spending behavior: from splurging on premium and luxury products to boost ego and social status, to counting every penny in fear of losing one’s job, or facing a future where jobs no longer exist.

Inside Hotmaxx, the “broke people”, literally “穷鬼,” as the Chinese jokingly call themselves, suddenly find themselves in paradise again. Many beloved snacks, including well-known global brands, are sold at around 10 RMB for standard packs and even less for mini packs.

Yesterday, I found my favorite Belgian biscuit, Lotus Biscoff, priced at 9.9 RMB for a 110g pack, normally sold at 15–20 RMB in premium supermarkets. At first, I was suspicious. But the detailed import label, the correct export registration code, and the name of Lotus’s officially authorized importer in China convinced me this was no dupe. It was the real thing.

Photos by author

As a trend forecaster, I can see clearly that China’s economy is now at a crossroads. Most business models that once thrived in a booming, upward-moving economy will be reshuffled, forced to adapt to this new era of deflation and consumption downgrading. Aggressive players like Hotmaxx, this new species of retailer, will dominate the next economic cycle. They will grow by serving the increasingly thrifty lifestyle that more and more Chinese consumers are embracing and will continue to hold onto in the years to come.