Behind the controversy of the Tongguan meat sandwich incident: the rise and dilemma of local specialties

Source: China Business Network

Reporter Sun Jizheng reported from Beijing

In the eyes of the public, local snacks are unremarkable, and have recently become a hot spot due to "trademark infringement". A few days ago, the use of Xiaoyao Town Hu spicy soup, Tongguan meat sandwich steamed by the association was sued by the association and demanded that the merchant compensation became a hot news, in the cause of public dissatisfaction, the State Intellectual Property Office pointed out that the above-mentioned rights protection behavior has exceeded the intention of protecting the trademark, and finally ended with the association apologizing to the public.

Local specialty snacks were originally "small businesses" for locals to go to other places, but now snack associations and even groups have long been established behind snacks, and these organizations are saddled with the mission of developing and revitalizing special snacks. Such as Shaxian snacks, Lanzhou ramen, etc. have become invisible national chain enterprises.

But for many local snacks, the most common problem is how to get out of the localization. Restaurant chain industry insiders pointed out to the "China Business Daily" reporter that there are two options for many snacks in China to go out, one is to process the products into convenience foods for external sales, and the other is to expand outward in the form of catering industry through the migration of personnel. Although there are successful precedents, there is a certain degree of non-reproducibility, so many snacks still face the problem of going out.

"Spoiled" snack association

In China, every place has a unique classic snack, in order to inherit and promote snacks, local governments often set up relevant associations and apply to the trademark office for "geographical indication collective trademark". The well-known Shaxian snacks, Yunnan bridge rice noodles, Lanzhou ramen noodles, etc. are all associations, and have applied for the group trademark.

The reporter found in the review of the judgment document network that the associations that have been committed to trademark protection are not limited to Tongguan meat sandwich steamed buns and Xiaoyao Town Hu Spicy Soup, and many associations, including Liuzhou Snail Powder, also have similar trademark lawsuits, which are characterized by the establishment and application for trademarks for no more than ten years, and there have been many such lawsuits.

In response, the State Intellectual Property Office responded that, legally, "Xiaoyao Town" is an ordinary trademark, and its registrant cannot collect the so-called "membership fee" accordingly. "Tongguan Meat Sandwich Bun" is a geographical indication registered as a collective trademark, and its registrant has no right to license the use of the geographical indication collective trademark to merchants outside the specific area of Tongguan and collect a franchise fee. At the same time, it has no right to prohibit merchants in a specific area of Tongguan from properly using the geographical names in the collective trademarks of geographical indications.

The reporter noted that in the past ten years, snacks across the country have established associations and registered collective trademarks. For example, in 2020, Hubei Daily issued a statement that "Xiangyang Beef Noodles" was registered as a collective trademark, and the collective trademark of "Xiangyang Beef Noodles" was registered.

Wang Jinhua, a pinyuan law firm engaged in trademark disputes, said that Tongguan meat sandwich steamed bun and Xiaoyao Town Hu Spicy Soup are typical geographical indication collective trademarks, residents and merchants in the area have the right to use the trademark, and there is indeed a possibility of infringement in use outside the region, and the association can ask merchants to change and protect their rights through normal channels, but the above-mentioned association uses it as a means of increasing revenue contrary to the essence of trademark protection, so it is "verbally criticized" by all parties.

Why do many restaurant associations sit on the orthodox names and trademarks of well-known snacks from all over the world? "Most of the above-mentioned snack associations are established by the local government in order to inherit and carry forward the excellent local snacks, but on how to develop local snacks, the relevant departments are laymen in the chain or industry, although there are ideas but there are difficulties in implementation." Industry expert Wen Zhihong said, but the problem is that China's excellent snacks are very rich, how to go out is a problem, although Tongguan meat sandwich steamed buns, Xiaoyao Town Hu spicy soup enjoys a high reputation in the local area, but from the national popularity point of view, is not a household name, the operation of snacks to go everywhere is what the association should do.

Behind the rise of snacks

As a snack chain with the largest number of stores and the largest coverage in the country, Shaxian Snacks' successful experience has been discussed by the public. From the perspective of popularity, Shaxian snacks, like most snacks in the early years, are difficult to cover the whole country, and the biggest problem of Shaxian snacks is that no product can be known to women and children.

The industry believes that the success of Shaxian snacks mainly lies in the organizational model of anti-modern management, that is, individuals and enterprises coexist, and do not distinguish between the so-called true and false, for individual Shaxian snacks, as long as the signboard does not imitate the Shaxian Snack Group's storefront, Shaxian Snack Group will never deliberately defend rights and suppress individual Shaxian snacks, which has led to a complete difference in Shaxian snack shops across the country.

However, Shaxian Snack Group has offices throughout the country and can provide upstream supply for all Shaxian snacks, which makes the self-employed Shaxian snacks obtain a stable product supply, and the quality control is gradually stabilized. According to the data, since 1997, the Shaxian government has vigorously built a supply chain system, set up a foreign liaison office of the Shaxian Snack Association in major cities, mainly responsible for the coordination, management, distribution, dispute resolution of Shaxian snacks, etc. Local offices can even provide free training for Shaxian people, making shaxian people more enthusiastic about starting a business in a foreign land.

"The strategy of Shaxian snacks is not to suppress any self-employed households, and there is no threshold, no store requirements, after consumers gradually form a cognition of the dishes and taste of Shaxian snacks, self-employed people will actively seek the group's upstream supply chain and training to achieve the taste of consumer cognition." Franchise expert Li Weihua said that although Shaxian snacks cannot achieve factory-level food standards like KFC, as a local snack, consumers can accept its differentiation. It can be said that Shaxian snacks are a successful case of localization transformation after absorbing the upstream food supply chain system of Western restaurant chains.

In addition, the well-known Lanzhou Ramen Is based on the Lanzhou Ramen Industry Association, providing technical training, production and processing, logistics and distribution, chain operation and other services to the members of the association. However, whether it is Shaxian snacks or Lanzhou ramen, for many self-employed households, they have an accepting attitude and will not suppress the existence of non-members of the association. The above-mentioned industry insiders believe that Shaxian snacks and Lanzhou ramen are inseparable from the large number of self-employed people throughout the country, and it can be said that self-employed people have made local consumers aware of this kind of snack.

"Shaxian snacks are the most unique existence in the case of restaurant chains, and its success involves the support of the local government, the ideas of local people going to various places to start a business and clan relations, so it is difficult to be emulated by other brands." But the success of Lanzhou ramen actually has a lot of reflection. Wen Zhihong said that the Lanzhou Ramen Industry Association did not suppress the self-employed, but improved the management level of the association members, as far as possible to improve the quality and service of food, such as Ma Zilu beef noodles and other brands gradually become the symbol of high-end beef noodles, making the brand height greater than the self-employed, forming the advantages of the brand and the association.

The snack chain is in the spotlight of capital

Catering people believe that for a long time, snacks, as a low-end industrial chain in the catering industry, have been difficult to receive the attention of capital, but since last year, the living environment of the catering industry has changed, and low-input, low-risk snack chains have begun to be concerned by capital.

In recent years, domestic snacks have shown a trend of explosion. Data from online platforms shows that snail powder has been the most popular snack product in 2019 and 2020. Liuzhou is the birthplace of snail powder, in 2020, the sales revenue of Liuzhou snail powder reached 11 billion yuan, the sales revenue of supporting and derivative products was 13 billion yuan, and the sales volume of bagging network was as high as 1.1 billion bags.

Although the snail powder industry is thriving, the Liuzhou snail powder industry has not focused on restaurant chains, but on convenience foods. Zhu Danpeng, an analyst in the Chinese food industry, believes that "snail powder, as a snack that has exploded in recent years, is mainly its special taste, and can replace foods such as instant noodles, and has the ability to quickly promote." ”

Liu Hui, a person in the restaurant chain industry, pointed out that the main reason why snail powder chose convenience food as the main channel is that the snack brand has been optimistic about capital. "Snacks such as Shaxian snacks and Lanzhou ramen are not restaurant chain brands in the strict sense, but a general term for a type of food. For a long time, no real snack brand has achieved nationwide coverage. Liu Hui said that for a long time, restaurant chains such as barbecues and hot pots that have no open flames are the favorites of capital.

However, this phenomenon has gradually changed since last year. In April 2020, Haidilao opened its first noodle restaurant, Eighteen Noodles, with a unit price of 9.9 yuan for fried sauce noodles that attracted attention. This year, Zhang Lala, Ma Jiyong and Chen Xianggui have successively obtained tens of millions or even hundreds of millions of yuan in financing. Subsequently, Xiao Man Pepper, Sheng Xiang Ting, Kwa Father Fried Skewers, Mo Mo Dim Sum Bureau, etc. also ushered in an investment boom, and even after Lu Zhengyao left Luckin Coffee, he also stepped into the snack industry to create Fun Noodles.

It is worth noting that these emerging snack brands have chosen to avoid the place where the snack belongs in name. Wen Zhihong believes that one is to avoid infringement, and the other is to try to cater to the preferences of young people through new brands. "Old brands actually have the problem of avoiding territorial names, such as the West Young Master Meat Sandwich Bun avoiding the above risks from the beginning of opening a store in Beijing."

"Although snacks cannot be cooked without an open flame, the production process of most snacks is relatively simple, especially noodles, snail powder, rice noodle products, and the upstream production and processing has reached the standard of semi-finished dishes, and the clerk can be served as long as it is simply processed, so it is easier to form a standardization." Liu Hui said that snacks often do not have too many requirements for the size and decoration of the storefront, you can quickly open the store, when the store is closed, you can also reduce the loss, the operator can be based on real-time feedback, the number and location of the store can be adjusted in time.

However, Wen Zhihong pointed out that the reason why snack chains have not invested heavily in capital for a long time is that the consumer repurchase rate is low and the substitution is strong. "However, due to the low overall operating costs of snack chains, snacks have become a better venture capital choice in the relatively low environment of the catering industry in recent years."