Text | Hedgehog Commune, author | Zhang Zhan, Editor | Shi Can
The first strand of spicy hot may be born.
According to the official website of the China Securities Regulatory Commission, on February 8, the "Approval of Overseas Initial Public Offering of Shares" submitted by Shanghai Yang Guofu Enterprise Management (Group) Co., Ltd. has been accepted by the CSRC. If successfully listed, Yang Guofu spicy hot will become the "first hot stock".
Yang Guofu's actions in planning to go public are traceable. As early as the beginning of 2021, Yang Guofu himself revealed to the media that the company has included the listing in the five-year plan, "mainly looking at the power behind the funds, hoping to bring new ideas to the development of the enterprise."
However, at the end of 2019, in an exclusive interview with Caijing magazine, Yang Guofu was also cautious about capital, saying that there was "no short-term listing plan". He said: "If capital is introduced, what they are asking for is short and fast, what kind of performance is required every year." We still need to take root at this stage. ”
Along with Yang Guofu's attitude towards capital, it is Yang Guofu's benchmarking object. At the end of 2019, Yang Guofu said that he wanted to make a seabed fish in the spicy hot world, but at the beginning of 2021, this goal became the Starbucks of the spicy hot world.
What is Yang Guofu, the vanguard of this spicy hot industry, thinking? What kind of industry reality is reflected behind this?
Spicy hot also has dreams
Spicy hot, is a "female classmate with a story": born in Leshan, Sichuan, in Harbin, three thousand kilometers away and into the country, it has become the daily diet of many consumers, but also rewritten the life of Yang Guofu and Zhang Liang, the two "sheep herding dolls".
In 2000, 30-year-old Yang Guofu began to try spicy hot. Before that, Yang Guofu, who dropped out of school at the age of 15, herded sheep, farmed land, raised pigs, sold garlic, and grilled lamb kebabs.
In 2005, the real birth year of the "Yang Guofu Spicy Hot" trademark, Yang Guofu's cousin, Zhang Liang, who used to sell alcohol, also began to get involved in spicy hot. At the beginning of the business, relying on relatives and friends to open stores, they easily developed twenty or thirty stores.
Today, 17 years later, according to the "narrow door dining eye" database, Yang Guofu spicy hot has opened 5650 stores, and the "rising star" Zhang Liang spicy hot also has 5610 stores. In the past 17 years, Yang Guofu and Zhang Liang have jointly experienced the reform of the franchise system that went out of Harbin, formalized, and opened stores overseas. In addition, they also experience one thing together: the "inferiority" brought to them by spicy scalding.
For a long time, in the minds of many consumers, low is synonymous with spicy and hot - the environment is not so clean, food safety problems are frequent, and there is no brand image to speak of. In the impression of Qin Haibo (pseudonym) after the 90s, he has not eaten a few spicy hot meals: "When I was in middle school, there were several spicy and hot restaurants next to the school, but my parents did not allow me to eat, and I felt that the storefront was not clean." ”
Screenshot of Yang Guofu's secret visit to the spicy hot store | Image source Weibo video
Fast, cheap, raw materials are relatively low-end, there is no technical threshold, some practitioners are of low quality, and these "original sins" of spicy and hot make it the one that cannot look up in the catering category. Zhang Liang said before: "There is no culture in the spicy hot industry and enterprises, and I used to participate in the big activities in the catering industry, and I felt very humiliated in my heart." Yang Guofu also said: "We hope that consumers can also have a sense of glory when they eat spicy and hot." And this is also an important reason why Yang Guofu wants to benchmark Starbucks - he wants to form his own brand culture and make spicy hot become a symbol of identity and fashion.
But back in the beginning, Haidilao was Yang Guofu's goal. Behind the desire to "become Haidilao" is Yang Guofu's ambition to achieve coordinated development of online and offline and consolidate the supply chain.
In September 2018, Sichuan Yang Guofu Co., Ltd. was officially completed and put into operation. According to Yang Guofu's own spicy scalding, this is the first intelligent factory in China with ultra-modern imported equipment. The plant can produce compound seasonings and process peppercorns, with an annual capacity of up to 30,000 tons, enough to supply more than 20,000 stores.
The factory can also produce hot pot base. Yang Guofu has always hoped that the company can produce packaged foods such as hot hot pot and hot pot base like Haidilao, thus enriching the company's product portfolio. In January 2021, Yang Guofu's official flagship store was officially launched, which is the first chain brand in the spicy hot blanch industry to open a store in e-commerce, and the main products in the store include self-heating hot pot and hot pot base.
It was in that month that Yang Guofu's goal changed: the company already had a strong supply chain capability, online stores and packaging products have also been launched, Haidilao seems to be no longer the most satisfactory benchmarking company, he set his sights on Starbucks , a brand that is more similar to spicy scalding in terms of unit price and store type. The most unlikely thing may be something that once stung the "old spicy hot person" - brand image and culture.
After experiencing the upgrading of franchisee management, the rapid improvement of market awareness, the construction of supply chain capabilities and other links, Spicy hot has embarked on a new stage - brand development.
Spicy hot transformation into a note
In fact, in the matter of branding, Yang Guofu may have no choice: on the one hand, consumers pay more and more attention to quality and experience; on the other hand, the new spicy hot brands that continue to pour into the market are also forcing traditional spicy hot brands to make changes - in recent years, new spicy hot brands have sprung up like mushrooms, such as small pepper, Fuke, spicy Xiaoxi, Xu Xiaoshu, Dear and so on. Without exception, each of them has a prettier appearance and a more comfortable dining experience.
Spicy hot is a very typical oligopoly competition market - although there are Yang Guofu and Zhang Liang in the market, the real oligopoly pattern is still far from being realized, and there is still huge market space waiting for new brands to tell new stories.
Shi Leilei, co-founder of Xiao Brute Pepper, told hedgehog commune (ID: ciweigongshe) that the market size of the spicy hot product is large, it belongs to the high-frequency products that are just needed, and it is a national cuisine, which is relatively limited by the regional influence, and it is easier to make a national brand, and the high standardization of spicy hot is also a major advantage. Guo Liang, the founder of Fuke Spicy Hot, expressed nearly the same meaning in a public speech, and he also emphasized that spicy hot products are malleable and easier to be liked by young people.
Although the market opportunity is relatively large, it is also the consensus of the industry that it is difficult for spicy hot brands to obtain financing. Several investors who have long been concerned about the catering industry told hedgehog commune that in the face of the two giants, it is difficult for the new spicy hot brand to make substantial differentiation, and the operation of the spicy hot shop is more difficult, how to ensure food safety and control the cost of raw materials is a problem. But they all told hedgehog communes: "There is no problem with the track itself, but the key is to see how to do it." ”
As of press time, there are only two brands in the entire spicy hot industry that have received financing - Xiao Man Pepper Spicy Hot and Fu ke Spicy Hot, of which Xiao Man Pepper is the first and only brand in the industry to obtain 3 rounds of financing, while Fu Ke only obtained tens of millions of yuan of Series A financing in 2017.
Shi Leilei, co-founder of The Little Wild Pepper Spicy Hot, told hedgehog Commune that unlike the traditional spicy hot shop model, the little pepper takes the small shop model - about 60 square meters, and 3 labor is enough to operate the entire "dine-in + takeaway" store. Shi Leilei said: "Spicy hot after all belongs to fast food, fast food traffic is generally passive customer flow, dense small shops can help brands capture more customers." In this way, the investment amount of a single store can be lowered, the store return cycle will be shorter, and it is more conducive to expanding franchisees. ”
For the places that consumers in the store can most perceive, The small pepper has the following three points of differentiation value: first, food safety, the small pepper only retains the most popular dishes for consumers with the help of takeaway data analysis, so as to provide convenience for store ordering and food quality assurance; second, a cleaner and cleaner dining environment, the store design of the small pepper takes a bright, fashionable, national tide brand route as a whole, more youthful; third, the product types are diverse, in addition to spicy hot, small pepper and spicy mix, as well as "snacks" and other categories The combination of "spicy mix + 2 yuan rice to eat full" solves the pain points of many male customers who are not full of spicy and hot food.
Compared with the positioning of "big brand parity" of small peppers, the positioning of Fuke sounds more "expensive" - the hot pot quality is spicy and hot. In order to fully ensure the quality, unlike most spicy hot brands, Fuke adopts a direct chain approach, which is bound to affect the expansion rate of Fuke - it began to specialize in spicy hot in 2010, according to the narrow door restaurant eye database, there are currently only 37 stores, and the small brute pepper established in 2015 has 152 stores.
Unlike most spicy hot shops that are opened on the street, Fuke Spicy Hot chooses to enter the mall, such as Fuke's Beijing first store chose Beijing's Chang development Vanke Plaza. On the store model, Fuke adopts a large store model of 100 square meters and 12 people management. In terms of store design, Fuke adopts the style of MUJI and National Tide, and at the end of 2020, Fuke also opened a brand concept store "Fuke Spicy Hot Academy" to carry forward the decoration style of "net red style" to the extreme.
Fuke Spicy Hot Academy | Image source "Shenzhen Circle"
Since it is positioned in the "hot pot quality", then Fuke reflects this positioning in all aspects of the dining experience: the dining utensils are customized "happiness amphora"; in addition to the general spicy hot ingredients, Fuke introduces hot pot boutique ingredients, such as Australian snowflake fat beef, hair belly, shrimp slip, live shrimp, etc.; Fuke's free self-service snacks have a total of 13 models...
All of these strategies point to one word – expensive.
Spicy and hot, aim at your wallet
According to the survey of hedgehog communes, Yang Guofu, Zhang Liang, Xiao Bru pepper and Fu Ke all adopted the method of weighing and pricing regardless of meat and vegetables, the price of Yang Guofu and Zhang Liang was roughly 27.5-29.8 yuan per catty, the price of small brute pepper was 29.8 yuan per catty, and the price of Fu Ke was 38.9 yuan per catty (excluding fine ingredient areas, such as fat cattle, etc.). (Author's Note: The price of the same chain brand in different cities and different locations in the same city will vary, and the data comes from comparable stores near the same central business district in Beijing or Shanghai, and the data node is February 2022)
According to the data of the narrow door restaurant, the average unit price of Yang Guofu Beijing Store and Xiao Man Pepper Shanghai Store is about 20-30 yuan, while the unit price of Fuke's two stores in Beijing has reached 50 yuan and 56 yuan, that is, if you are not careful, you will reach 60 yuan.
Instead of choosing dine-in and takeaway, Hedgehog Commune has selected three stores closest to the hedgehog Commune Editorial Office, and comprehensively considered the preferences of the authors, customized the following "Hedgehog Spicy Hot Meal" with the standard of 12 dishes. (Author's Note: According to statistics, consumers generally choose 10-12 dishes per meal of spicy hot, so this set with staple food is customized according to the standard of larger meals)
As can be seen from the figure, Yang Guofu's spicy hot hot hand price is the lowest, 31.64 yuan, the small wild pepper spicy hot is 38.14 yuan, and the price of Fuke spicy hot is close to 50 yuan, reaching 46.76 yuan.
The conclusion is clear: Xiao Man Pepper is slightly more expensive than Yang Guofu and Zhang Liang Spicy Hot, but there is no very significant difference, while the price of Fuke Spicy Hot Pepper is directly raised to another grade - in the standard price of the store, the highest price difference is more than 30%.
So the question arises: Are consumers really willing to spend so much money on a spicy hot meal?
Song Yi (pseudonym) after the 90s told the hedgehog commune that the maximum price of spicy scalding she can accept is 50 yuan, and generally more than 30 yuan she will feel expensive, and 60 yuan of spicy scalding is something she will never consider. Wang Xinlei, founder of "New Restaurant Chain" and a professional who has been deeply involved in catering for many years, said that unlike some emerging catering categories, consumers' cognition of spicy hot has been relatively mature, and there are clearer requirements for its price range, so it is more difficult to increase the premium.
Shi Leilei agreed that "spicy hot can not be too expensive", he told the hedgehog commune that Xiao Bru pepper hopes to control the unit price of customers at about 30 yuan.
So how to ensure low prices and increase profit margins? The answer naturally points to cost control.
Shi Leilei said that the optimization of the environment does not necessarily mean the rise in decoration costs, design is the key, the small pepper will also be designed to be more compact kitchen area to reduce the cost of store rent; and in the circulation planning, the small pepper has adopted a "double moving line" design - the traditional spicy hot shop dish area is against the wall, but the small pepper chooses the design of the double-sided opening, so that the route of employee takeaway and customer dine-in is completely separated, which helps to improve efficiency.
In addition, the reduction of the number of SKUs for small pepper dishes has also reduced the management costs of employees, thereby further improving human efficiency. "We feel that the simpler it is to manage this matter, the better, the less the better." Shi Leilei said.
On the other hand, Forker is increasing costs. Each pot bottom of Fuke is jointly customized with Haidilao Shuhai, and each leafy vegetable is jointly cultivated and customized with the soilless hydroponic base of South China Agricultural University, coupled with the location strategy of entering the mall, it is difficult for Fuke to achieve low prices.
When the first store in Beijing opened, Fuke invited fashion models to the scene for fashion shows, and also invited several street dancers to help at the door, and the activity of "guessing with beautiful women to win the king meal" also attracted many customers. It is not difficult to see that Fuke is working very hard to tell consumers, especially young people: spicy hot can also play a new trick, and I am not the same spicy hot. Or to put it another way: I have my reason for being expensive.
Street dance performance outside the Spicy Hot Shop | Graph source network
The "heart of awe" for spicy hot
Yang Guofu, Xiao Man Pepper and Fu Ke represent three typical types of spicy hot players: Yang Guofu is an era follower who is unwilling to be abandoned by the market, Xiao Man Pepper is a reformer who keeps the right and innovates, and Fu Ke is a radical subversive.
Their development direction points to two words, "quality" and "experience", which are actually not fully achieved by the traditional spicy hot.
Wang Xinlei, founder of "New Restaurant Chain", said: "Some people may think that spicy and hot is quite low, but it is a product of that era. Now the development stage of Chinese society is different, emerging consumers are no longer satisfied with such an environment and ingredients, and the limitations of the era of spicy hot are highlighted, so we need to use new ways to 'redo' spicy hot. ”
Shi Leilei also said: "Spicy hot is a fast food after all, it will certainly not be as fashionable as casual meals, and in recent years, spicy hot is also developing in the direction of branding." ”
Spicy hot | Image source "Eclipse"
But does category and brand upgrade necessarily mean that prices rise? Both Wang Xinlei and Shi Leilei held a negative attitude. Shi Leilei said: "There is no contradiction between category upgrading and price affinity. Strengthen control from this end of the supply chain, establish its own warehouse allocation system, and then strengthen the unity of stores and the control of store-side products and services, so that the branding of spicy hot will become more and more solid. ”
In this way, the opposite of low may not necessarily be the high-end route and high price, because quality does not necessarily mean high-end ingredients, safety is enough; experience does not necessarily mean "home away from home", comfort is enough.
Of course, there will be a long queue at the door when The new store opens, which means that there will still be consumers who recognize the concept of high price and high quality, but The Customer may need to be mentally prepared for the difficulties in the process of large-scale replication - 40 stores opened in 10 years, placed in any catering category, may not be considered too good results.
Li Yuanfei, an investor who has invested in brands such as Zi Hi Pot and Sumida Chuan, has studied hundreds of catering companies, and in her conception of the ideal catering target, the standard of "reverence for users and products" is placed in the first article. In her view, catering brands should have a reverence for products, show the spirit of craftsmanship, and be committed to being a respectable enterprise or a brand that users trust.
Yang Guofu also said when trying to overcome public opinion and carry out store standardization reform: "In the past, we had only one purpose - to eat enough. However, there must be reverence in making meals. ”
What exactly can help Spicy Hot get rid of the label of low on the body? The answer is clear: with reverence, responsible for both the consumer's stomach and the consumer's wallet. Perhaps only in this way can the spicy hot category truly win the respect of consumers.