China transformed: growth opportunities in a reshaped market

For most of the past two decades, the engine driving China’s beverage alcohol market has been banqueting and business entertainment. Now that has largely switched off – and is unlikely to return to its previous heights in the foreseeable future – a new dynamic has taken its place, characterised by younger LDA consumers, casual social occasions, home consumption and the rapid rise of on-demand delivery.

According to IWSR analysis, 2026 will see a mixed performance in China, with early indicators suggesting that some categories in the market might have bottomed out, while categories such as baijiu continue to decline and categories such as imported white spirits and RTDs continue to grow – meaning that, for businesses willing to track the new consumer reality rather than wait for the old one to return, there are genuine windows of opportunity.

This comes after a challenging 2025 for the Chinese market, with total beverage alcohol (TBA) volumes falling by -4%, or by -2% excluding national spirits (baijiu). But this masks dynamic growth for some categories, such as white spirits, and signs of promise in whisky, white wine, premium beer and RTDs.

“After another difficult year in 2025, alcohol consumption in China is migrating away from obligation and gifting, and towards personal enjoyment, casual social occasions and value,” says Shirley Zhu, IWSR China Research Director. “This shift is reshaping who buys, what they buy, where they buy it and how much they are willing to spend.

“Younger LDA consumers are embracing casual drinking, and they remain largely absent from high-end wine and most premium brown spirits. Meanwhile, older drinkers are being more selective and cautious as business occasions have yet to return. Home consumption has started to grow across spirits and wine, alongside the expansion of smaller formats, on-demand delivery (O2O in China) and solo or small-group drinking.”

Right place, right time: the new occasion landscape

The shift away from business-oriented gifting and entertainment to personal enjoyment is manifesting itself in many different ways, transforming channels – across the on-trade, off-trade and ecommerce – and creating dynamic growth opportunities such as at-home consumption and increasingly popular miniature formats.

“The on-trade has been going through significant changes, shifting from large, high-energy venues towards smaller bistros, cocktail bars, fusion restaurants and live houses (venues with live music),” notes Shirley Zhu. “However, business occasion dining, historically the engine of premium sales, has largely disappeared.”