Daxue Road in Yangpu district is one of Shanghai's most popular food streets. The 700-plus-meter road is packed with more than 80 stores, mainly restaurants and cafes, and most feature outdoor seating areas in various styles that keep the street bustling with vitality, especially on weekends.
Zhang Xiaoli, head of ibarrel, a restaurant on Daxue Road, says, "Without outdoor seating, our income may decrease by half."
During the 2024 winter season, outdoor seating areas were fitted with plastic wind shields to withstand falling temperatures, with support from local authorities and business operators. Sales volumes along the road rose 24 percent year-on-year, with the coldest month of February surging 38 percent.
Outdoor seating has become a popular business model across Shanghai. At Hengshan Fang in Xuhui district, more than two-thirds of stores have outdoor seating.
"Not just restricted to Western restaurants, Chinese-style restaurants also set up outdoor seating during afternoon tea time due to growing demand," says Wu Hanchun, deputy general manager of Shanghai Hengfu Investment Development Co, noting many customers who prefer outdoor seating are foreigners, thanks to eased entry requirements for international visitors.
Tong Tianci, head of the restaurant at Hengfu, agrees, saying outdoor seating is not just an extension of the business area but also a "traffic entrance" for small shops. "Many customers are attracted to the atmosphere, especially foreign tourists. No matter the weather, they are willing to sit outside to enjoy Shanghai's street views."
In Changning district, the manager of Columbia Circle, a restored compound now home to offices, stores, restaurants and cafes, says consumers, especially those between 20 and 35, have an extremely high preference for outdoor seating. "On sunny days, weekends and during festivals, outdoor area occupancy exceeds 90 percent. People feel compelled to sit outside, even if they have to queue."
Shanghai has standardized nearly 1,000 designated stalls and set up more than 500 special stall areas, covering over 4,000 stores, most selling light meals and coffee.
The booming "outdoor economy" is a rational emerging phenomenon, according to experts. "Outdoor economies meet the diverse demands for experiential, social and authentic urban life," says Xie Ruoqing, a researcher at the Shanghai Academy of Social Sciences. "People's emotional needs for connecting with nature and engaging in interpersonal interaction in the open air are part of that shift."
In recent years, local authorities have introduced measures encouraging well-regulated outdoor seating areas and street vendors, including extending operating hours during holidays and festivals and adding infrastructure such as public lighting, restrooms and waste disposal.
Daxue Road is a frontrunner in this economy. In 2023, local rules were introduced on the design of outdoor seating: areas should not extend beyond street lamps to avoid blocking traffic; dividers between stores cannot exceed 130 centimeters to avoid a confined feeling; and rain covers and cables must be inspected regularly for safety.
Similar rules are expected soon in Huangpu district, after three years of trial operations, extending outdoor display space to include shared tenant areas and rooftops, and removing fixed time limits so operators can flexibly adjust hours.
"Shanghai's outdoor street economy shows that fine-grained governance can make street vending a key driver of consumption recovery, while transforming urban vitality into cultural appeal," Xie adds.