The epidemic has made many catering people feel tormented, the gossip of "closing the store" is full of many media, the news of the closure of Haidilao and tea and pleasant colors has been repeatedly interpreted and chewed, and there are many articles on the horse and hindsight.
In a speech, Jia Guolong quoted the classic line of the movie "Wrestling Bar Daddy" to fight back against the doubts and gossip of all industries, and I deeply believed: "We are responsible for hard training and serious competition, and the villagers are responsible for talking nonsense and sneering." ”
During this period, I saw the sunny side of the restaurant industry, that is, the accelerated increase in the chain rate. Public data shows that the "chain rate growth rate" will increase by as much as 240% from 2019 to 2021.
The accelerated rise in the rate of chaining means at least a few things that are changing:
1. The professionalization of the catering industry has entered a new stage. With the evolution and reshuffle of chain catering brands, today's catering industry has experienced a team with great professional ability, and the professional ability of a large number of chain brands is not the same as that of ten years ago.
2. China's restaurant industry has become an industry, not a restaurant owner's sole struggle. The chaining of a brand is a systematic project, and the infrastructure includes strong supply chain capabilities, personnel training capabilities, site selection capabilities, and standardized replication capabilities, which either exist in the brand or exist in a professional third-party team.
3. Abundant and stable industry funds. Although the epidemic has caused a lot of impact on the industry, it has also matched the in-depth cooperation between chain catering brands and primary and secondary capital markets, a large amount of capital combined with catering brands, and a large number of large chain catering brands are eager to try to prepare for listing.
In the profound adjustment of all this, more catering brands have also begun to seek new "business model" upgrades, once, the catering treasurer mentioned that the structure, the model is more about the category, product structure, but now the smart treasurers began a bigger attempt, that is, the innovation of the new franchise model.
What exactly is joining? We can think from the perspective of direct operation and brand authorization, from the perspective of direct operation, generalized franchise is a way to expand the leverage, borrowing the funds, brainpower, manpower and resources of franchisees to expand their brands. From the perspective of brand licensing, franchise is a business model in which the brand owner authorizes franchisees to use brand assets for business profit. No matter from that point of view, joining is a "social" brand expansion method, and the franchise itself has different specific models in different countries, store types, categories, and markets, but whether it is that model, the franchise itself is a social contract model that fully integrates resources, funds, and humanity.
First, the prejudice and misreading of joining
However, China's franchise market seems to be in a strange state, which is full of people's misconceptions and prejudices about joining. These biases exist in the minds of almost every franchisee, franchisee, and industry person I've observed.
1. The bias that direct marketing is better than franchising
Most of the catering people in the heart of the contempt chain often think that the catering people who can do a good job of direct operation are cattle people, and "doing franchise" seems to have become a slightly pejorative prejudice, which includes both the franchised brand and the franchisee.
But in fact, to do a good job as a franchise brand often requires stronger capabilities. On the one hand, relative to the direct operation of 100% all-round strong control, franchisee control is more difficult, if you can join the relatively weak link can still make the store continue to maintain vitality, growth, it is very difficult. On the other hand, the assets held by franchised brands are often of higher quality, and compared with the store assets held directly, the franchised main brands generally have more valuable supply chain factories and related distribution systems, and from the perspective of financing valuation, the latter has a higher valuation possibility.
2. If the business is not good, let you join
When the business is not good enough and the expansion momentum has problems, some direct catering brands have begun to release franchises in order to quickly solve the growth problem. Among them, there will be two types of franchisees, one is the existing brand, the existing store transfer assets into a franchise, we can also call this kind of franchise direct custody franchise, the other is to close the existing business of the poor stores, and then release the incremental franchise stores, with lower operating costs to manage the store, only to provide a small number of services for franchisees, in order to quickly return funds while achieving expansion.
3. The opposition between franchisees and franchisees
This is a "Chinese-style" unhealthy phenomenon of joining the industry, when choosing to join the main brand, franchisees are often worried about the vitality of the franchised brand, and will often find ways to play a game between strong control and self-management rights with the franchisee after the successful franchise, or be wary of whether the franchised brand will run. The root cause of this phenomenon is that a large number of "cutting leeks" type franchise owners will join itself as a way of profit, not deeply bound to the long-term interests of franchisees, and if a brand does not do well, it will quickly run away to do the next brand. At the same time, franchisees often make excessive commitments to income and performance when they join the franchise, resulting in inconsistencies between reality and facts, thus forming a contradiction and conflict between franchisees and franchisees.
4. Short-term gains are heavier than long-term gains
If a franchised brand uses the franchise fee as its source of income for the vast majority of its share, it must be concluded that the brand is a "leek-cutting" type franchised brand and is not worthy of being trusted. Franchised brands that cannot share the same interests and desires with franchisees for a long time cannot get long-term development. Sadly, we are often able to see these types of brands in the market. Such brands often deceive franchisees with brand names, category choices, and core products that are highly similar to well-known brands, and even franchisees will find imitated brand complaints after finding that franchisees run away, which also makes many head brands very helpless and angry.
5. Supply chain is the king of making money
Supply chain revenue is a very important source of income in both the high-quality franchise model and the "cutting leek" franchise model, which is understandable. However, I personally believe that supply chain profitability is not the best way to make a profit by joining. The logic of this point is that when most of the franchisee's income comes from selling goods to franchisees, it considers that it hopes that franchisees will continue to buy goods, although this point is positively related to the franchisee's business, but there is still a positive relationship between the franchisee's business, but there is still a part of the franchisee's main brand will prompt the franchisee brand to over-order goods, resulting in inventory backlog. Therefore, When Reck rock made McDonald's big, when it released McDonald's to join in the early stage, it made it clear that McDonald's did not act as a supplier, but resolutely controlled the supply chain production standards and was the standard setter. Be a referee instead of a player.
Second, the general trend of joining
1. Excellent franchisees can make great franchisees
If a franchised brand joins the main company is very rich and does a good job, but the franchisee is full of sorrow and self-destruction, it is obviously not enough to call it an excellent franchise brand. A great franchise brand should first be able to "achieve" more franchisees, and its organization should have a strong "altruistic" spirit.
How can this be done? One of the most critical points is to "choose the right franchisee", which is very important!
The key reason why Tsinghua University is called The top university in China is that Tsinghua University itself selected the best students in China at the beginning, and it is exaggerated that even if these students rely on self-taught talents for four years of college, they can still stand out in many key indicators such as employment rate after graduation.
Therefore, we will find that "strict selection" is the common criterion for excellent franchisee brands to choose franchisees. Franchisees and franchisees should obviously be a "partnership" relationship of mutual achievement, with the same interests, the same values, and everything for the sake of customers.
In the franchisee filter of the head franchisee main brand, not only is there a screening of the franchisee operator himself or even the inspection of partners and family members into the elements that must be reviewed, in the release of the franchise will not only not over-promise the franchise income, but will increase the home visit link, in order to express to the family the connotation of the franchise that investment needs to be cautious.
2. Joining is a lever of expansion, not a way to make a profit
A brand's long-term profit model must deeply create value around the "customer", which is the long-term profit model. After most brands turn to joining, all the thinking focus and focus of work have shifted from the consumer side to "investment promotion", how to find more franchisees has become the focus of work, but ignores the customer who needs to be most concerned about a company in fact, who ultimately pays for its own business model.
Therefore, cognitively and mentally, the franchise model is only a leveraged behavior. Similar leverage includes: loans, financing, listings, store partnerships, etc... In essence, they are all means of leveraging growth, not the ultimate goal of business operations.
3. Only by long-term common interests can we be invincible
"How to make profits" is a key element in the design of the franchise model, as mentioned above, the key to this problem is still who the franchise owner brand thinks is "profitable"? Obviously, the "benefit" of a healthy franchise model must come from the customer.
The creation of customers, the giving of value are a long-term, continuous process, customer needs will continue to change, franchisees and franchisees need "long-term same interest and desire" in order to always maintain the brand in the market young state. In most of the current franchise models, franchisees simply charge a fixed annual brand management fee after the success of the store, which cannot be linked to customer feedback and only cares about the franchisee's drought and flood protection model obviously does not have long-term value, and most of the brands are getting worse and worse.
Therefore, it is very important to dare to make the same proportion of profits in the long-term business process of franchisees. When customers recognize the brand and franchisees live well, franchisees earn the same amount. When customers lose their love for the brand and franchisees have difficulties in survival, the franchisee income can also feel the crisis, and this simple model design logic is the real franchise long-termism!
4. Organizational change is the real challenge
In many franchise practices, the most difficult point is not the design of the franchise model, but the reengineering and reform of the franchise organization. The directly operated organization is a positive triangle organization, accustomed to the boss's decision-making, headquarters execution, and store landing. When a direct brand becomes a franchised organization, the working mode of the entire organization needs to take a 180-degree turn. The franchised organization is an inverted triangle of the organization, the boss is at the bottom, the headquarters is essentially the franchisee's service center, and the store is the real front-line decision-maker who can "hear the cannon fire". Although this change can be carried out by executive order in the organization, the most difficult change of mentality is that the boss and the headquarters are accustomed to arbitrary changes and attempts without a contractual framework.
How can we achieve organizational change from direct to franchised? The essence of the operating organization is an economic unit born of profit, so the driving force for changing the organization is actually to change the structure of the distribution of benefits in the organization. That is, to change the way value judgments are made within an organization. Where the interests of each cell in the organization come from and why they change determine the growth direction of the organization and the direction of the battle.
Third, China's future joining
1. Positive incentive franchise model
In my opinion, there is a huge difference between Chinese-style franchise and Western-style franchise in the underlying design logic. Western-style franchise emphasizes contract, mainly expressing "can and can't", while Chinese language is softer, it emphasizes more "I and your future", the same contract, but more emphasis on what we do together, how to ultimately profit. There is no right or wrong between the two, and even the Chinese-style joining language needs the blessing of the Western contract spirit.
Therefore, simply applying the Western-style franchise model to the head of Chinese chain catering enterprises is not very likely to succeed. In the exchange with many brands of franchisees, I found that most of the franchisees have not actually read the franchise agreement in full, and most of them rely on their own judgment and belief in the franchisee. This "rule by man" mode of thinking is deeply imprinted in the bone marrow of Chinese.
Therefore, the franchise model that belongs to China's fertile catering land must have a Chinese-style thinking model, coupled with the protection of the Western contract spirit, in order to finally succeed.
2. The sinking market is king
Where is this fertile ground? From the perspective of Chinese flows, it is clear that when the urbanization rate of first-tier cities reaches 70%, the phenomenon of reverse urbanization is gradually emerging, that is, a large number of people who cannot eventually stay in first-tier cities gradually leave large cities at the age of 30 to 40 and return to their provincial capitals, prefecture-level cities and even county seats.
Due to the imbalance of China's land and development, urbanization and anti-urbanization are actually appearing at the same time, but the overall trend is "sinking". First-tier cities are facing population reduction, labor force reduction will eventually lead to a sharp rise in labor prices, and the industrial structure is also undergoing profound adjustment.
The dividend of shopping malls is not brilliant with the cliff of the real estate market, and even in first-tier cities, there are only a few shopping malls with high popularity. At the same time, the pressure on street shops to be controlled by cities in first-tier cities is still unabated. Eventually, the store opening market in the first-tier market continues to be in a state of fierce stock competition, of course, this will also make the first-tier cities become a strong and strong chain market, and eventually push up the chain rate of first-tier cities.
Therefore, from the overall trend, "small town youth returning to their hometown to start a business" is a huge opportunity to join the market. Nowadays, those Wandian brands such as Wallace, Zhengxin Chicken Steak, and Michelle Ice City are firmly stepping on this outlet. In the 4th and 5th tier cities, they are the chain ceiling of the entire city, the absolute sinking king.
epilogue
From the perspective of developing the brand, joining is a powerful expansion lever, which can ensure the long-term stable operation of the mechanism in the future through a series of scientific designs.
Putting aside rationality, from the perspective of an entrepreneur achieving a brand, joining is actually a process in which a brand is achieved by society and then achieved society. The biggest difference between entrepreneurs and entrepreneurs is that entrepreneurs achieve themselves, and entrepreneurs achieve more people.
The creation of the franchise model is a science, but returning to the brand tests the motivation of an enterprise. How to make a profit? How to divide the profits? How to achieve long-term benefits? This test is the pattern and mentality of a boss's heart.
Of course, there is not only one model of achieving people, but everything will eventually return to the level of "people".
Today's Chinese catering industry, like Guoyun, is also experiencing "major changes that have not occurred in a hundred years", although I do not think that the catering industry can still achieve the same rapid development as the 5 years before the epidemic in the future. But I believe that today's catering is still in a "good era", an era worthy of more catering people's expectations, and "joining" and "partnership" will play its due role in it, which is worth every catering person's continuous thinking and exploration.