Image source @ Visual China
Wen | Red Food Network
Many people call green tea "listed with disease", but after dismantling the development of green tea for more than a decade, we found that it may not be so powerful, but it is not as vulnerable as the market criticism.
The first shot of the 2022 Chinese restaurant listing may be fired!
On March 8, relevant reports show that Green Tea Restaurant has passed the listing hearing of the Hong Kong Stock Exchange and will start a roadshow this week, and if all goes well, it is expected to be officially listed on the main board of the Hong Kong Stock Exchange in late March or early April!
This means that in this wave of catering "listing tide" in 2022, Green Tea Restaurant may become the first brand to complete an IPO.
It is worth mentioning that Green Tea's IPO road is not smooth, in March 2021, its first IPO application, but there was a relatively low-level data error, which caused a lot of doubts, and then the prospectus invalidated.
In October 2021, Green Tea updated its prospectus and launched a second IPO, however, many people inside and outside the industry are still not optimistic, believing that Green Tea IPO is a "diseased listing".
Today, we will deeply analyze the past and present lives of green tea restaurants, and count the advantages and dilemmas of green tea. By dismantling it, we find that it may not be as powerful, but it is not as vulnerable as the market critique.
Farewell youth hostel, green tea restaurant on the top
Perhaps many people did not expect that the birth of the green tea restaurant was actually an accident.
In 2004, Wang Qinsong and Lu Changmei opened a green tea youth hostel in Hangzhou that provides catering and accommodation for tourists. From the attribute point of view, youth hostels are a new concept industry of contemporary sojourn, with a human touch that is not possessed by standardized hotels and inns. Based on specific social factors and business formats, youth hostels are favored by contemporary youth backpackers.
The customer base of Green Tea Youth Hostel has a certain particularity, and the tourists are basically from all over the country, and most of them are young people who pursue cost-effectiveness. For these reasons, Green Tea Hostel offers travelers a fusion of Zhejiang cuisine instead of Hangzhou local cuisine.
After operating for a while, the boss found that there were more guests who came to the hostel to eat than stayed, which made Wang Qinsong have the idea of opening a restaurant.
In 2008, the first green tea restaurant was successfully opened in Hangzhou, which continued and carried forward the characteristics of green tea youth hostel dishes, characterized by integration and cost performance, supplemented by exquisite decoration with Chinese style.
Many customers found that the restaurant had a rich dining experience, but the price of the dishes was extremely close to the people, such as Dongpo meat at that time only sold for 10 yuan a piece, and there were many dishes below 10 yuan. With its cost-effective characteristics, the first green tea restaurant exploded after its opening.
The success of the first green tea restaurant also allowed Wang Qinsong to see more possibilities. In 2010, Wang Qinsong decided to open a branch, and he opened a second branch in Beijing, which in his view is more inclusive and has a more diversified dining culture.
After arriving in Beijing, the green tea restaurant was once again recognized by the market, and at each meal, the restaurant specializing in Zhejiang cuisine would almost always line up in a long line.
After 2011, green tea restaurants expanded their commercial territory to Shanghai, Suzhou, Ningbo and other places; in 2015, green tea restaurants jumped out of the Jiangsu and Zhejiang circles and entered the southwest, and in the same year, green tea restaurants also developed their first sub-brand "Playking", which is positioned with Western food as the positioning, and the first store opened in Beijing; in 2017, green tea restaurants said that they would open a stew brand called "Made in Kanto".
In the year of Kanto-zuku's development, Green Tea Restaurant received a strategic investment of US$70.63 million from the United Group with a 30% stake. However, unlike the previous smooth start, from 2017 to 2021, green tea group seems to have been not going well, first of all, Playking's 7 stores in Beijing have closed down, and then Hangzhou's Kanto manufacturing is also in a state of suspension.
However, although the sub-brand has lost all its battles, green tea restaurants are still relatively strong. As of September 30, 2021, Green Tea Group still has 208 green tea restaurants across the country, covering 18 provinces, four municipalities directly under the central government and three autonomous regions in China.
The latest prospectus shows that the loss of green tea restaurants in 2020 has also been improved, and from January to May 2021, green tea restaurants have begun to turn losses into profits, the turnover rate and average daily sales of single stores have also increased, and the number of green tea restaurant stores has also increased from 184 at the beginning of the year to 208.
Positive profit data, the number of stores that continue to grow, and the intuitive recovery of growth data, it is clear that green tea is actively releasing positive signals to the outside world. And perhaps it is precisely because of these data that green tea has finally passed the hearing of the Hong Kong Stock Exchange.
What is the core competitiveness of green tea restaurants?
The positive profit data of green tea mentioned above is a chip for green tea to achieve the odds of success, so through these data to explore deeply, what is the core competitiveness of green tea? Is this core competitiveness enough to support its subsequent development?
1. Rely on fusion cuisine + cost performance to fight the world
First, let's go back to a key question. Continuing to be chosen by customers, through 13 years on the road to IPO, what is the right thing behind the green tea restaurant?
Many people think it is because of the high turnover rate of its fast-fashion restaurant model. Its founder Wang Qinsong once said frankly: "Other restaurants may make money when the guests are full, but the green tea restaurant is to turn over the table to start making money, and the service ceiling of the green tea restaurant is 7 times, reaching more than 4 times, and the restaurant begins to make money." ”
This remark also once made many people mistakenly think that the reason why green tea can make money is because of the high turnover rate. However, The observer Jun saw from his prospectus that from 2018 to the present, the average turnover rate of green tea restaurants was only 3.19 times, and from January to May 2021, the turnover rate of green tea restaurants was 3.32 times, while its net profit reached 58.388 million.
From this point of view, the turnover rate is not the core reason for its rapid development, and we will continue to explore.
Wang Qinsong said two keywords in an earlier interview with the media: creative dishes and cost performance, in fact, these two words tell the core competitiveness of green tea.
Wang Qinsong pointed out that green tea restaurants should be a national chain brand and will not be limited to local cuisine. At present, the dishes of green tea restaurant are not limited to the fusion of Zhejiang cuisine, the restaurant has also added Sichuan cuisine, Cantonese cuisine, Lu cuisine, Beijing cuisine, Cantonese cuisine and other local cuisines, and then from the menu point of view, the cooking method of green tea restaurant also integrates the techniques and production styles of Western food, such as cheese shrimp, cheese baked potatoes and other dishes.
As the interview said, Green Tea Restaurant has indeed embarked on its own path of creative cuisine.
At the market level, creative cuisine is different from traditional local cuisine, it belongs to a new fashion category that is different, many consumers are willing to pay more for it, it is a category that can be done at a high price, but green tea restaurants have chosen this cost-effective road. Wang Qinsong believes that at the level of business, cost performance is the key to the sustainable and large-scale growth of stores.
In the enterprise registration profile of the enterprise investigation, the green tea restaurant marked: "focus on providing consumers with special fusion dishes", Wang Qinsong said that the creative dishes and the fusion dishes in the enterprise profile department also have a certain cognitive repetition in people's brains, belonging to the similar and intricate two words, in order to be objective, the observation jun studied the registration of creative dishes and fusion dishes from 2005 to 2021.
It can be seen from the registration data that the registration data of fusion vegetable enterprises is slightly higher than that of creative vegetable enterprises, but the number of enterprise registrations of both has not exceeded 1,000.
Under such a weak category development momentum, green tea restaurants have opened more than 200 restaurants in 13 years, which shows that the winning factor of green tea restaurants is not only creative dishes & fusion dishes, but also cost-effective is the winning magic weapon of green tea restaurants.
Simply put, it is through creative cuisine & fusion cuisine + cost performance that green tea restaurants can develop and grow all the way and gain a firm foothold. (For the sake of convenience, "creative cuisine/fusion cuisine" is briefly described as "fusion cuisine".
Why is fusion cuisine + cost performance the winning factor of green tea restaurants?
From a historical point of view, the predecessor of green tea restaurants, Green Tea Youth Hostel, was established in 2004, during which time, the consumption potential of young people was gradually being stimulated, when "poor travel" was a "net red word" in young people's circles. The youth hostel launched by Wang Qinsong is also a track focusing on young consumer groups, and the youth hostel is just stepping on an era.
In the period from 2004 to 2008, the entire catering industry existed more traditional local cuisine, fusion cuisine is a new product, and Wang Qinsong as early as the hostel restaurant, set the concept direction of making cost-effective fusion cuisine. Later, the hostel restaurant exploded, attracting countless diners who came to eat, indicating that his cognition was very correct, and on this basis, to launch the first green tea restaurant, its popularity became a natural thing.
Around 2008, the catering industry still rarely had the category of cost-effective fusion dishes, and the green tea restaurant had already passed the verification of the green tea youth hostel customer group, so it was on fire.
Cost-effective fusion dishes require brands to understand fusion dishes, but also to achieve cost-effective output, and at the same time have mature flipping service capabilities, which is not easy for many catering brands to achieve. This has also become a strong competitive barrier for green tea restaurants, with this barrier, green tea restaurants have ridden the dust and become a fragrant food introduced by multiple commercial complexes, and the scale of stores has expanded rapidly.
Looking back, green tea really benefited a lot from those two axes. But to sort out whether green tea restaurants can continue to be popular, we also have to pay attention to a new question - what kind of competitive situation is the cost-effective fusion cuisine system today?
From the data table, we can see that in the past, green tea restaurants were made by 50-60 yuan per capita, but today the per capita green tea restaurant has reached the range of 70-90 yuan, which is why green tea restaurants used to say that 4 times to make a profit, and now 3.2 times to turn over can be profitable.
In addition, the current competition in the cost-effective fusion cuisine category is also more intense than ever, and in the past, the cost-effective fusion cuisine was known to everyone as the Three Musketeers: Grandma's House, Green Tea Restaurant, and New White Deer.
2. Green tea restaurants have a trend towards high-end cost-effective consumption
Today, the industry rarely talks about the three musketeers of cost performance, and the reason is not complicated: there are many more cost-effective fusion restaurants, cost-effective fusion brands and other popular fusion cuisine brands than ever before, and the competition can be described as white-hot.
Under the fierce competition pattern of cost-effective catering, we also seem to see that the public cost-effective logic of green tea restaurants has a trend upward.
Specifically, it can be seen that at the beginning of development, green tea restaurants have been sought after by the market with a high cost performance of 40-60 yuan per capita. In 2017, Wang Qinsong showed in a media interview that the per capita positioning of green tea restaurants was 60 yuan, and at present, the highest per capita price of Green Tea Restaurants in Hangzhou has reached 99 yuan, and the price of the must-eat list of two meals sold by the store is 205 yuan (the original price is 225 yuan).
In addition, the per capita green tea restaurant in many places has basically risen to about 80 yuan, which is obviously visible that the green tea restaurant is no longer as affordable as in the past, and there is a trend from mass consumption to high-end consumption.
In the original per capita consumption range encountered a bottleneck in development, it is understandable to pull up a little bit, but it is a big challenge for green tea with cost performance as the basis of the restaurant.
Bid farewell to the high cost performance, what problems does the green tea restaurant face?
The per capita growth of green tea has grown from 40-60 yuan to 90 yuan or even higher, which is almost 2 times that of the past. From a practical point of view, the change in the per capita consumer will bring about a change in the brand customer base, and it will also bring about a change in the brand label.
1. The per capita is gradually raised, and the cost performance is no longer high
Since the past, green tea restaurants have been emphasizing "cost-effective", so most of them have attracted public cost-effective customers, but in the case of the white-hot and integrated cuisine of the whole cost-effective catering and the red sea of fusion cuisine, the competitive pressure of green tea restaurants can be seen.
The author flipped through the green tea restaurants in Hangzhou, Beijing, Guangzhou, and Shanghai, and made statistics from the first 15 reviews of the store.
Statistical method: In Hangzhou, Beijing, Shanghai, Guangzhou four places to select a restaurant with the first evaluation of intelligent recommendation, the previous 15 display evaluations as a sample, in each evaluation to screen a keyword as a statistic. If the customer mentions four elements in a review, the surprise point and the spit point are used as the filter, such as no surprise point, the spit point, and the part with the largest number of words is the keyword.
Statistics show that customers in green tea restaurants pay more attention to taste/dishes, and then to service, and the cost performance is the last. It can be seen that with the rise of per capita, the cost-effective label of green tea restaurants may be gradually stripped away.
Nowadays, the cheapest dish in green tea restaurants is 8-12-15-18 yuan (not counting staple foods and drinks), 8 yuan dishes are potato shreds/ice cream balls, 12 yuan dishes are baked potatoes, 15 yuan dishes are mapo tofu, and 18 yuan dishes are small dumplings/small wontons. The price of stir-fried vegetables is in the range of 20-72 yuan.
From the menu point of view, the green tea restaurant in the past 5 yuan of cucumber has been removed from the shelves, replaced by 18 yuan a piece of perilla cucumber, even the earlier only sold 3 yuan of mapo tofu has also increased the price several times (3-8-12-15), from the update of the menu can also be seen, the gradual increase in the price of dishes has increased the progress of the average consumer.
The increase in per capita will make customers pay more attention to the restaurant's dishes and services, which puts forward higher requirements for the products and operations of green tea restaurants. However, at present, the performance of green tea at this level is not good.
2. Revenue channels are too single
It is worth noting that behind the lack of product research and development capabilities, the revenue channel of green tea restaurants is too single, all rely on green tea restaurants, and there is no sub-brand blood supply, and its performance in the category of takeaway and retail is also flat.
It can be seen from the financial report data that in the column of the proportion of green tea restaurant revenue, takeaway revenue has declined in 2021, and green tea restaurants have also responded in the prospectus: "Mainly because our strategy focuses on restaurant operations, resulting in a decrease in takeaway orders."
In the view of The Observer, takeaway is regarded by many restaurants as an important channel for increasing revenue. For green tea, which once took the cost-effective route, takeaway may be a good idea, but its per capita is rising, and the sales of takeaway may also be a major disadvantage.
At the same time, green tea restaurants have not laid out retail products. The only mall of green tea restaurants is to sell tea leaves, aromatherapy essential oils, these two types of products, and the restaurant is not much related, and most of the product sales are only single digits.
In addition, from the perspective of the composition of the financial report revenue, in the case of frequent failures of sub-brands, Green Tea Group is still a single-brand strategy, and there are no other revenue channels such as takeaway or retail, and most of its revenue comes from the green tea restaurant dine-in itself.
The narrowing of the revenue channel also affects the return on investment of the restaurant, and the prospectus shows that the average cost of a new green tea restaurant opened by Green Tea Group is around 3.3 million yuan, and the return on investment period of a single store is 17.5 months. Compared with the data of Tai'er 7 months and Grandma's house 7.4 months, the return on investment efficiency of green tea restaurants is significantly lower, and this may also affect the perception of the capital market.
What should be the future of green tea restaurants?
However, it should be noted that the view of capital and the view of the market are sometimes very different, capital pays attention to data, and under the huge data cluster, the net profit margin may be a key indicator.
Some securities companies disclosed that in 2018-2019, Haidilao's net profit margin ranged from 8% to 10%, the range of jiumaojiu was between 5% and 7%, and the net profit margin of green tea restaurants was in the range of 5%-6%. In contrast, green tea belongs to the weaker brands.
However, the market's view is relatively simple, the store continues to operate, continue to make profits, continue to overturn, and continue to be selected by customers, which means that the catering brand can survive. It can be seen from the fact that there are still queues in green tea restaurants that green tea has not been abandoned by the market.
However, in order to continue to gain a firm foothold in the catering market in the future, green tea restaurants still have a lot to do. Observer Jun believes that we can start from these four directions: rapid development, going deep into the masses, promoting explosive products, and making progress together.
1. Rapid development
Many years ago, the green tea restaurant has solved the problem of standardization and supply chain, through the central factory, the headquarters can do unified distribution to the branch on the food side.
Since there is such a foundation, green tea can completely refer to the business path of other similar brands and take a diversified development route. Hefu Lao noodles, Meizhou Dongpo, Xibei, Haidilao, etc., they are taking the diversified development of central factories + stores + takeaway + retail e-commerce.
For example, if green tea restaurants want to speed up turnover, optimize the return cycle, and enhance brand value, they can change the current thin model of central factories + strong stores + weak takeaways, and test the waters of retail.
In the view of The Observer, green tea restaurants have a large number of products that can go through retail channels, such as Wowotou, handmade brown sugar steamed buns, green tea cakes, etc., which have corresponding and formed business models in retail channels, e-commerce channels, supermarket channels, and even new retail channels such as Hema. In the case that the basic supply chain system has been completed, the green tea restaurant to take this step is just a push along the water.
Entering more channels also has a lot of enhancing the brand power of green tea restaurants, and one more sales channel also has one more profit entrance.
2. Develop community stores and reach out to consumers
At present, the location of green tea restaurants is mainly concentrated in shopping malls, while in the area of community stores, green tea restaurants are not involved.
In 2018 and 2019, brands such as Xibei and Xibei have gradually developed their own community stores, and most of Xibei's advertisements have hit the community elevator, which can help Xibei guide customers directly from the community to community stores and shopping mall stores.
Different from shopping malls, community stores have three advantages worth paying attention to at the moment, one is to go deeper into the masses, customers can go out of the house to the store, saving the cost of customers' arrivals; the other is the competition is dislocated, most of the strong brands settled in the complex, while the community stores are not so strictly controlled, which means that the brand potential of green tea restaurants can be maximized in community stores.
The third is that operating costs can be optimized, community store operating hours are more free, which is more affinity for customers, while community stores can also test the water breakfast, supper and other periods, so as to enhance customer satisfaction and enhance brand development potential, but also can develop new business periods.
For a cost-effective dining brand, a community store may be able to give it a try.
3. Promote explosive products and improve the research and development capabilities of dishes
Although green tea restaurants continue to have new products launched, most of the new products are basically a formality, and not many can be recognized by the market and stayed, and then grow into signature dishes.
Judging from the reviews, the three major netizens of the green tea restaurant recommended dishes such as bread temptation, green tea roast chicken, and green tea barbecue meat have dominated the list for many years. This side reflects that there have been no new high-quality explosive products in green tea restaurants for many years.
In recent years, Green Tea Restaurant has launched new products such as fish head seduction, gold and silver garlic steamed anchovies, and Buddha jumping off the wall, but these new products are based on traditional dishes and are similar to traditional dishes, and their creativity and uniqueness are low.
Some commentators have pointed out that green tea restaurants have not produced explosive products for a long time, and even if they are new, they mostly tend to be mediocre. This is worthy of the attention of the green tea restaurant research and development team, green tea restaurant needs to glow the earlier explosive capabilities, in the fusion restaurant at the moment, the customer's expectation threshold for explosive products is higher than in the past, if you can not launch more explosive products to attract consumers, then customer satisfaction may continue to decline.
In 2021, green tea restaurants should pay attention not only to the capital market, but also to the catering consumer market, for green tea, the continuous ability to produce high-quality products is very important.
Observer Jun believes that the research team of Green Tea Group can visit various popular fusion restaurants to conduct research and customer interviews, and perhaps obtain some customer favorite ideas to complete the update of the logic of self-explosive products.
4. Develop profit portfolio products
The cost performance of green tea has its own logical limitations, Wang Qinsong has publicly stated, "will refer to the per capita consumer price range of the most popular merchants on the top 10 of the city where the store is located, and the general per capita consumer price of the final pricing of green tea restaurants will not exceed 15% of the price range."
After observing the data of the top 15 restaurants in the four cities of Beijing, Shanghai, Guangzhou, and Hangzhou, he found that the highest per capita popular restaurant reached 235 yuan, and the lowest was 26 yuan, which shows that the competition of popular restaurants is very diffuse. In addition, the average per capita average of the TOP15 popular restaurants in Hangzhou, Shanghai, Guangzhou and Beijing is 92-113-84-122 (yuan), which shows that even in first-tier cities, the average value fluctuates accordingly.
The per capita fluctuation range is large, which may be a good thing for green tea restaurants, because different cities can have different per capita fluctuations, such as Xuji Seafood in Changsha, the per capita control is about 150 yuan, while in Shenzhen the per capita is about 240 yuan.
Under such logic, green tea restaurants can jump out of the logical limit of parity on the basis of existing menus, and launch a series of high-profit and cost-effective products and high-priced cost-effective products (such as the launch of the small Dongzi brand from Da Dong, and Xiao Da Dong is taking this high-profit and cost-effective route, which belongs to the low-end version of Da Dong), so as to allow customers to control each person independently, so as to achieve the rise of brand net profit and the comprehensive development of the brand.
Conclusion
How to reform and develop green tea restaurants, I believe that green tea groups have their own methods and paths, we will not say more about this.
From the perspective of the long cycle of market development, listing is not the end of enterprise development, it will be a new starting point. After the successful IPO of Green Tea Restaurant, what kind of development will it usher in? Maybe time will give us the answer.