Image source @ Visual China
Wen 丨 Zero State LT(ID:LingTai_LT), Author 丨 Gu Nianqiu, Editor 丨 Hu Zhanjia
The story of the layoffs finally happened to Xicha.
On February 9, according to Sina Finance, Heytea is implementing layoffs internally, involving 30% of employees, and it is reported that the information security department has been completely destroyed, and the store development department has laid off up to 50%. Another internal employee said that all employees did not have a year-end bonus, or the year-end bonus was "postponed".
▲Photo: Sina Weibo
On February 10, Xicha responded that the relevant rumors were false information, the company did not have the so-called large layoffs, and a small number of personnel adjusted to normal personnel adjustment and optimization based on year-end assessment. At the same time, the year-end bonuses of employees have also been issued to employees normally before the Spring Festival according to their performance.
This is not the first "new tea drink" company to be involved in the layoff storm.
In December last year, the incident of the CEO of Cha Yan YueShi fighting employees in the work group made the public sigh, and the focus of the debate was precisely the salary reduction of "the original salary was reduced from about 5,000 yuan to about 2,000 yuan, and the commission was only 8 yuan". The salary cut itself is a kind of discouragement for employees and the initial signal of layoffs.
The tea of Nesher, another giant of "new tea drinking", is also not good. Throughout 2021, in the case of receiving multiple food safety fines, Nesher's tea also faced a more serious loss problem. In June 2021, Nesher's tea fired the first shot at the listing of new tea drinks, with an IPO price of HK$19.8 per share. Today, the share price is about HK$7, which is cut from the issue price.
Not only is the "new tea" track ushering in a new round of reshuffle, but the catering companies that have emerged in the past five years have also stepped down from the altar. At the end of last year, the leading brand Haidilao announced the closure of more than 300 stores, and nearly 30,000 Haidilao employees faced job transfers, and Haidilao promised not to lay off employees. The layoff information released by Xicha today echoes Haidilao's store closure.
The dilemma of Xicha is also the decline of new consumer brands.
01, employees are eager to be laid off
Heytea did not deny the layoff problem completely, but glorified it as "personnel adjustment and optimization".
This basically confirmed The layoffs of Xicha. Regarding the issue of the year-end bonus, although Heytea denied it, a "Heytea employee" said that the year-end bonus was issued according to the original 0.4 times. The so-called "performance-based performance" is likely to be a statement that Heytea does not pay all year-end awards.
As the public pays attention to the layoffs, more and more details are surfacing.
A Heytea employee, who did not want to be named, told Zero-state LT that the laid-off employees could receive N+1 compensation or choose to transfer their posts. He said that many employees have hoped to lay off employees since the end of last year to "take their turn" and have no feelings for the company for a long time.
"In the service industry, meal disorders and welfare are barely tolerated. But last year's annual meeting, at ten o'clock in the evening, forced us to stay, and the annual meeting opened until midnight, which made people feel disappointed in the company. Referring to the company's practices, the employee said, "Poor performance is layoffs, and there are gangs among executives." Everyone knows that this job will not last long. Was laid off, took compensation and decent. ”
It is true that although it ranks first in the new tea track, Xicha's reputation in the industry is not worthy of the truth.
On the one hand, because the founder is too young, Nie Yunchen, born in 1991, shoulders the heavy responsibility of building the first brand of new tea drinks, and also because of his own youth, Xicha has taken many detours. On the other hand, the management of Heytea basically relies on poaching from other companies, and the policy within the brand is not uniform.
The brand is too young, and the wind evaluation of Xicha has not been ideal. Knowingly, under the question of "what is it like to work at Heytea", there are all kinds of negative evaluations. A part-time employee described the real scene of working at Heytea, one meal a day, no time to go to the toilet, more than 12 hours of work, overtime and not much money. This review garnered more than 250 likes.
Pictured: Zhihu
The layoffs are just a microcosm of The Heytea dilemma.
Many media speculated that the layoffs were "paid for" by Xicha's loss last year. Throughout 2021, the sales growth rate of Heytea has gradually declined, and the overall revenue is not optimistic. The annual loss of Nai Xue, which is comparable to Nai Xue, is between 135 million yuan and 165 million yuan, and the loss of Xi Tea last year should also exceed 100 million yuan according to this calculation. Layoffs, while reducing labor costs, also make up for the previous decline in profits.
Another insider close to the top management of Xicha said that The layoffs of Heytea this time can make the financial data look good, and it is likely to prepare for the next listing plan.
Heytea has an extraordinary influence on the subdivision track. The most recent financing dates back to July 2021, and this Series D financing Heytea earned $500 million, with a valuation of more than 60 billion yuan after financing, which is 6 times that of Nai Xue's tea, the "first share of new-style tea drinking". From the perspective of the financing process, it is only a matter of time for Heytea to go public, but before the listing, the internal and external troubles faced by Heytea are encroaching on this young new consumer brand.
02, management is difficult to develop
Young, the achievement of Xicha, but also created the "internal worry" of Xicha siege.
Overnight popularity, so that the growth of Heytea management lagged behind the brand tension. Nie Yunchen, the founder of Xicha in 91, incubated a small brand and grew up, in addition to his own efforts, there is also a luck bonus. In 2016, nie Yunchen, who was only 25 years old, used half an hour to impress IDG Capital and investor He Boquan, obtaining financing of 100 million yuan, and Heytea has since started the journey of a new tea drinking track.
Pictured: Nie Yunchen at the celebration of the 8th anniversary of Xicha
In 2017, Heytea went out of the Pearl River Delta and opened up new markets in Shanghai. It is reported that the first store of Xicha in Shanghai People's Square is located in Raffles City Mall, and the queue time can reach up to 6 hours when opening the store. With a daily turnover of 4,000 cups and a daily turnover of 80,000 yuan, Heytea has become a rising star in the tea drinking industry and has also become a "fragrant feast" in the catering track.
Good IP, let capital indulge in a new round of "wealth-making movement". Since 2016, Heytea has completed a total of 4 rounds of financing, involving IDG Capital, Meituan Dragon Ball, Sequoia China, Black Ant Capital, Tencent, Hillhouse and other head financing institutions.
The super-rapid growth of the brand and the excessive favor of capital have exceeded the load capacity of the Heytea brand.
This is especially true at the level of management.
"The executives are Tencent, there are Vipshop, and each has formed a gang. Sometimes you don't need to do a good job, you just need to stand on the right side and get good performance. A former employee who has left Heytea described the facts of Heytea's internal struggles to Zero-State LT (ID: LingTai_LT), "Unlike the architecture of a large company, not only is there no way to improve efficiency, but it also can't retain people." Very few high-level executives have worked for two years because they feel that there is no future. ”
The high-level open competition and secret struggle naturally make the management level of Xicha unsatisfactory. Nie Yunchen's statement on the acquisition of Lele Tea made people question this talented young man.
Picture: Nie Yunchen's circle of friends
In July 2021, it was reported that Yuanqi Forest and Xicha both had plans to acquire Lele Tea. Nie Yunchen then responded in the form of a circle of friends, "The news is not true, there was indeed a period of contact after being introduced by the intermediary, but after a deep understanding of the internal situation, business data and situation, it has been completely, completely and resolutely abandoned." ”
Although the volume of Xicha has come out on top in the new tea drinking track, it is really "shocking" to publicly criticize the behavior of friends and businessmen. More Xicha employees broke the news that at last year's annual meeting, Nie Yunchen publicly commented that there were drawbacks in friendly businessmen, and this move was "out of order".
The young fame brought nie Yunchen not only capital, but also pride, but also made the management of the young brand of Xicha from the top down, and there was a gap from maturity. This undoubtedly limits the growth of Heytea.
Judging from the management ability of Xicha, it is particularly difficult for Nie Yunchen to manage a brand with a valuation of 60 billion. Judging from the current situation of competition in the beverage track, whether 60 billion will shrink or not, there is still a question mark.
03, 60 billion is just a thing of the past
Drink track, newcomers enter. This is a stumbling block for Xicha to move forward.
The entry of new people means that the share of Heytea is being divided, which can also be seen from the slowdown in the opening speed and profits of Heytea in 2021. In October last year, the average revenue and sales efficiency of Heytea shops fell by about 20% compared with July, and fell by about 32% compared with the same period last year, and the brand charm of Heytea is disappearing.
What is shrinking is not only the hey tea and the new tea drinking track, but also the entire new consumption era.
The head brands of the catering track are facing the dilemma of expiring dividends in the new consumption era. For example, Haidilao, which became famous in the early years, has been "paying" for the magnificent expansion plan in 2019 for the past two years. Whether it is a food safety fine or a store closure plan, it is essentially the brand that is confused by the growth bubble, and the sharp decline in consumption brought about by the epidemic has also made new consumption no longer in the dividend period.
Therefore, there are "open source and throttling" measures such as layoffs at the beginning of the year. But layoffs are not the life-saving straw of Xicha, and if you want to hold 60 billion, Nie Yunchen has to have a new solution.
Looking back on the growth of Xicha, the answers given by Nie Yunchen are neat and innovative. When the market was opened in the early days, the quality and taste of the drinks were steadily controlled, which made Xicha stand out among many tea drinks.
In the medium term, the value of the brand was deepened during the expansion of the market, which made Heytea, a new tea brand, quickly gain household names. The coin also has a back, and the same period of expansion also faced many problems such as food safety and false publicity, and the answer sheet of Heytea can still pass.
However, the new tea drinking is in full swing, the new consumption era is gradually fading, and heytea has come to the middle and late stages of development. The impact of new brands and the intensification of losses are just the beginning. The longer it has been in the catering consumer market, the more severe the problems faced by Heytea.
How to solve the fatigue of consumer tastes? How to differentiate in the cheese milk cap tea market? In the future, the value of the brand is to stop at catering or expand to other tracks - if you want to hold the market value of 60 billion, Nie Yunchen still has too many problems to solve.
The future of Heytea depends on the management policy and operating model of the stock era. One side layoffs, a "sophistry", may be able to make Heytea's data relatively beautiful, but also damage the credibility of the brand. Young Nie Yunchen should also fade his pride, otherwise he will not be able to hold the big brand of 60 billion.