Major food chains in China including KFC and Cotti Coffee are increasing menu prices while reducing delivery subsidies. The shift marks an end to aggressive discounting that pressured profit margins across the food delivery sector.

The pullback follows a regulatory investigation into unfair pricing practices. Years of cutthroat competition between delivery platforms like Meituan and Ele.me forced restaurants to offer steep discounts, eroding their earnings.

Industry analysts expect more brands to follow suit, restoring pricing power gradually. However, consumer resistance could limit how much restaurants can raise prices without losing volume.

Companies now face a delicate balancing act between protecting margins and maintaining customer loyalty. The adjustment may signal a maturation of China's once-rapidly expanding food delivery market.