Text | Kaiboluocaijing, author | Jin Jiepan, Editor | Ai Xiaojia
In 2022, Manner Coffee (hereinafter referred to as Manner) is going to change its way of living.
This March, "3 days, 10 cities, 200 stores", Manner's crazy store opening plan is underway, and it has announced the opening of takeaway for the first time.
Manner, an affordable specialty coffee brand, was sought after by capital for many years before it was sought after. Do not learn Starbucks, the early stores do not have seats, coffee can only be taken out; do not learn Luckin, do not do takeout at all; do not seek efficiency, use a semi-automatic coffee machine, but also need a barista to complete the production process; not to talk about the scale, the first three years only opened 3 stores.
After being noticed by capital, it has grown into the highest-valued emerging coffee brand in a few years, with a valuation of $2.8 billion after the latest round of financing.
When the outside world began to ponder it, the "BoLe" capital that originally found it suddenly withdrew, leaving suspense for the outside world: What happened to Manner?
We may wish to look at the two actions of expanding the city and taking out, one is the most courageous store opening plan, and the other is "making an exception" to open takeaway. This is a routine operation for other coffee brands, but for Manner, who "lives in Shanghai", it is enough to write into the timeline of Manner's 7 years of entrepreneurship. Moreover, what is gained and what is lost is very clear.
After opening a store to expand the city, Manner finally stepped out of the beach and joined the coffee alley battle in the first-tier cities. But Tuocheng will also undergo greater tests, can the story of the small shop continue? Does the profit model still work after making the store bigger?
Launching takeaway, Manner can expand coverage and attract new users, but if the number of cups goes up, is the most differentiated cup experience for users still guaranteed?
"In the past, the store opened too slowly, and now we must hurry to make up for it." In the eyes of some investors, Manner is overdrawing its valuation for the next few years. Some investors joke that Manner will "change its flavor" sooner or later, and the biggest difference between it and Luckin is that I am afraid that what is left is not a fully automatic machine. The semi-automatic coffee machine may be the last stubbornness of the "boutique" Manner.
The store opened, but the story was gone
In 3 days, 72 hours, 200 new homes were opened in 10 cities, and Manner's store opening plan was lightning fast enough, equivalent to 2.8 stores opening every hour.
However, the actual scene is not as exaggerated as Manner advertised, because the 200 households have already opened in January and February this year.
However, due to the epidemic situation, the opening of some stores has been delayed, and the fixed activity of Manner opening new stores, "Three-day Free Activity with Cups", has also been postponed. According to the statistics of the narrow door dining eye, as of February 2022, Manner has a total of 382 stores in the camp.
The first task of Manner's store opening plan is to fill in the already crowded Shanghai coffee landscape more densely.
According to the narrow-door restaurant eye data, in Shanghai, the city with the most cafes in the world, Manner has accounted for 295 seats, and the density in the Jing'an and Huangpu districts in the city center is particularly high.
In Lujiazui, a prime office location within the Inner Loop, Manner and Giant Starbucks can all play in the ring. Within 500 meters of Lujiazui, Manner had 6 stores in August 2021 and Starbucks had 8 stores in the same period.
Zhu Yun, who is responsible for the expansion of a coffee brand store, often operates in the central area of Shanghai, and she told Kai Pineapple Finance that Manner's stores like to be Tui, often appearing on a road, and the location is always not far from Starbucks.
"Manner has covered a type of point in the core area of Shanghai, and this round of shops belongs to the detection of leaks and fills in the gaps." Chen Momo, an investor who pays attention to the coffee track, said.
The second task of Manner's store opening plan is to get out of the beach and find a new world.
In the most popular areas, opening a street shop with the smallest area, controlling the cost of opening a store, setting the price low, and then using high traffic to ensure the number of customers, the small shop high-efficiency model, is Manner's secret weapon for profitability in the early Shanghai area. According to Late Post, an investor said that by the end of January 2021, Manner's Shanghai store was fully profitable.
Feng Wei, an investor who pays attention to offline consumption, told Kai Pineapple Finance that the rumor circulating in the circle is that a manner store of several square meters has an initial investment of only 300,000 yuan, the unit price of customers is about 20 yuan, the daily cup volume is four or five hundred cups, and it can be returned in more than 3 months, and it will soon be copied. "At the time point of 2015, this small shop model was not benchmarked, which is an innovation in business model."
Manner was once small enough to open a store directly into someone else's store. For example, there are stores in Shanghai that open in a corner of the Hema store; in the early days, its store in Beijing's Huamao Shopping Center was "hidden" in a men's clothing store, with a size of less than 10 square meters.
Today, unlike in the past, coffee shops in first- and second-tier cities are becoming saturated, and Manne can't rely on the small shop model alone.
An investment manager who has previously investigated Manner said to Open Pineapple Finance that the small shop points that best represent the Manner model are concentrated in the old city of Shanghai, but such high-quality points are really limited and cannot support Manner's Shanghai dream.
Shenzhen and Beijing are even more scarce in small shops, where the roads are wider, and the "shopping mall" culture has replaced the "shopping" culture of the magic capital to some extent. Manner, who has just arrived, did not open any small street shops, and if he wanted to enter the gathering place of white-collar workers and young people, he had to enter the core business circle and win the high-traffic point at a high price.
"Manner can't find the same store type as Shanghai, so in order to adapt, he has to adjust the store type and open it in office buildings and shopping malls." Feng Wei said.
The above-mentioned investment manager concluded that Manner mainly enters two types of shopping centers in Beijing and Shenzhen, taking Beijing as an example, either based on office scenes, such as Xinzhongguan store and Wangjing store, or shopping scene-based, such as apm store and Taikoo Li store. In such a core business district, it is a luxury to find the original Manner store of less than 10 square meters.
"The store has to be made bigger." Zhu Yun revealed that in the middle of last year, 80% of Manner's stores were small stores of about 10 square meters, and the newly opened stores in the later period were getting bigger and bigger, and now 20-50 square meters are the main store type.
"Manner is no longer the model that capital is first seeing today." Feng Wei said that this directly affects the single-store model, and whether the adjustment is suitable or not has not been verified.
Buddhist teenagers, began to "go with the flow"
The story of the small shop is not easy to tell, and Manner can no longer be a Buddhist teenager. On March 13, Manner announced, almost at the same time as the Lightning Store Opening Plan, that it would "make an exception" to start takeout. The cooperation platform is Meituan.
Insisting on not doing takeout for seven years, in a coffee track that is easier to digitize and standardize, is really incredible. But what happened to Han Yulong, the coffee cannon, seemed to be more reasonable.
Before founding Manner, Han Worked as a coffee roaster. A widely circulated story is that he once turned down a guest's request to order a takeaway of 30 cups of coffee at a time. It's the same reason he refuses to let Manner do takeaway: waiting will turn the original mellow coffee into a sour "potion", "in order to make this 'fast money' and lose the credibility of the brand, the loss is not worth the loss."
In fact, Manner "punched his face" this time, it was sooner or later. In addition to the well-known epidemic reasons, but also because of the non-take-away, pure physical store model, the ceiling is too low.
Although Manner can order online, it can only reach the commercial buildings and office areas around the store, which also determines its upper limit. During non-working days and off-peak hours, cup sizes cannot be guaranteed. This is especially true in cities outside of Shanghai.
In addition to opening more stores, Manner wants to expand its coverage and attract new users, I am afraid that only the road of opening takeaway is left, after all, the cake of takeaway is really tempting. Starbucks will generate 3.5 billion yuan in the Chinese food delivery market in 2021. Zhang Chenkai, director of CIC's Consulting, said that Starbucks, Costa, Luckin, Seesaw, M Stand, etc. have all opened takeaway businesses earlier, and takeaway channels can play a role in promoting the profitability of a single store.
Manner Shanghai first store image source / Manner official micro
If you put it on Manner, the problem will be complicated. The most direct is that it may destroy the consumer's "bring your own cup" experience.
Manner's model is "parity + take-out", the product price band is 15 yuan -20 yuan, if you bring your own cup to "hit" coffee, you can also reduce 5 yuan.
Chen Momo, who lives in Shanghai, said that during the morning and afternoon rush hour, there is always a long queue outside the Manner store, and it is often about 20 minutes to wait for a cup of coffee. "Drinking two cups a day can save 300 yuan a month, which is attractive to the budget-conscious Shanghai white-collar workers and the workers who use coffee as a daily consumable."
If the takeaway business is doing well, consumers with their own cups are likely to wait longer. A loyal manner user told Open Pineapple Finance that after the takeaway was opened, the order was placed 20 minutes in advance, and it was still necessary to wait for more than ten or twenty minutes to pick it up, and the production speed of several nearby stores was not stable, and it was not going to pay for this waiting time. Such sounds are not unique.
"Manner is not using a fully automatic coffee machine, and the large-scale expansion will bring a certain degree of pressure on barista talent and supply chain management." Analysys analysis brand retail industry analyst Li Xinyi analyzed.
The representative of commercial coffee, Starbucks and Luckin, uses a fully automatic coffee machine. Manner's boutique strategy makes it more fond of semi-automatic coffee machines, that is, it still needs a barista to complete the production process.
Such a decision still comes from Han Yulong, who once mentioned to the media, "I don't want to be mechanized, I don't want to erase the personality of every barista, this should be an industry with feelings." ”
In simple understanding, Manner, which uses a semi-automatic coffee machine, can have a better taste, correspondingly, a higher operating threshold and a lower degree of standardization.
However, many coffee practitioners are not superstitious about semi-automatic coffee machines. Feng Wei got the argument from some coffee entrepreneurs that fully automatic machines are developing rapidly, and the quality of the coffee produced is not necessarily worse than that of semi-automatic coffee machines.
Coffee industry entrepreneur Chen Huang also has the same view. He has experienced Manner in Shenzhen and Nanning, seen some busy Manner stores, produced far from pure hand-brewed specialty coffee, and the problem of extraction occurs from time to time.
"It's hard to watch and adjust the extraction scheme at any time, because on the one hand it's very demanding for baristas, and on the other hand, it's time-consuming." Chen Huang explained. He said that instead, with a fully automatic brand, it is stable to go to which store to drink.
If you look at it from the perspective of positioning and marketing, the semi-automatic coffee machine is the last stubbornness of the "boutique" positioning in his view, at least in the face, retaining the pride of specialty coffee. In cities with a heavy coffee culture, a semi-automatic coffee machine may be the core differentiated competitiveness.
Busy expanding stores, opening takeaways, can semi-automatic machines take into account quality and efficiency? Can the back-end barista training keep up? Whether the delivery business is doing well or not, there are problems waiting for Manner to solve.
Capital achievements, but also subject to capital?
Spend a dozen dollars to buy a latte, open the lid and look at it, there is artificially pulled specialty coffee. Workers will be moved by Manner to become "iron fans".
But capital doesn't. The story that capital wants to hear is speed, it is scale. Even if it has been deeply involved in a fraud scandal before, Luckin speed is still often mentioned by investors.
The same is the positioning of the medium price band, there are relatively rich non-coffee products, are very important to the private domain community operation, "Luckin can rely on capital to quickly open stores, why can't you?" said the investment manager.
When it comes to opening a store, Manner and Luckin have long had a "relationship". In May 2018, when Luckin was frantically expanding the city, Manner, which had been established for three years, did not talk about "scale", and posted an unsigned text on the official WeChat public account, "Manner, or go slowly, like a child, just don't wrestle." We still want peace, grow up, adulthood. ”
Four months later, Today Capital invested $80 million in Manner, taking away 40 percent of the shares. Two months after receiving the financing, Manner opened five stores in Shanghai. That year, Luckin expanded more than 2,000 stores.
Throughout 2019, Manner opened 48 stores, an average of two per month, and the following year, continued to open more than 50 stores silently. In 2020, coffee brands with names are shouting the slogan of expanding stores, and Tims Coffee's goal is the most conservative, "opening 1500 stores", without setting a time. Luckin's slogan is the most radical, "Open 4800-6900 stores by the end of 2023".
With the endorsement of "venture capital queen" Xu Xin, manner's rhythm of taking money began in quarterly units from the end of 2020 to the first half of 2021, and 4 financings were intensively carried out.
Valuations have multiplied several times. In June 2021, Manner's latest round of financing was valued at US$2.8 billion (RMB17.8 billion). At that time, Manner had less than 200 stores nationwide, equivalent to a store valuation of 100 million.
In the eyes of some investors, Manner is overdrawing its valuation for the next few years. "Manner will have to be at least two or three thousand to support this valuation." Feng Wei said that the fund is to return, and there is no way to expand rapidly under the pressure of shareholders.
Xu Xin said in an interview with 36Kr, "What I want is a big single product", "to achieve tens of billions of sales revenue, large billions of profits is the ultimate pattern." A single brand can not do too much, but also to engage in multi-brand. ”
By the time she said this, she had withdrawn from Manner. On May 26, 2021, Tianyancha information showed that the old stocks of Today Capital were taken over by Coatue and H Capital. Before taking over, today Capital and Han Yulong, Lu Jianxia and his wife jointly held 40% of the shares.
Some interpretations say that because today capital sees the ceiling of Manner's expansion. However, more than one investor believes that the main contradiction may be that the investor has a big disagreement with the founder and the founding team in terms of strategy and business philosophy.
Xu Xin left the market, Manner still has to adapt to the speed of capital requirements. After all, the opponent has already run out a long way.
Experts from Third Bridge's High-Level Consulting previously predicted that the coffee track in 2022 will continue the heat of 2021, and unlike the characteristics of milk tea products that need to be manually blended and need to be continuously iterated, coffee products are relatively fixed, machine utilization is high, and the replication ability of each brand store will be higher.
In the first quarter of 2022, Starbucks, Luckin, Tim Hortons, and Peet's Coffee have all launched or are preparing expansion plans. A number of new coffee brands such as Seesaw Coffee, M Stand, and Algebra are also besieging prime locations in first-tier cities.
If Manner is still on an equal footing with Starbucks and Luckin in Shanghai, then in first-tier cities outside Shanghai, it has lost at the starting line.
And Manner is neither like Arabica who takes the influencer route, maintains a relatively high tone, and does not invest much in marketing. To expand the store, it is inevitable to do the same site selection with Luckin and serve the same customers. Feng Wei described that just like Manner's early store in Shanghai and starbucks, in other regions, Manner inevitably had to "face to face" with Luckin.
Some investors have analyzed that opening stores and opening takeaways in Tuocheng are all actions that Manner urgently wants to do, and may even be more radical in the future.
One of the bases of the analysis is that the CEOs previously stationed by Capital today are still there. According to the previous news of "IPO early knowledge", by the end of 2020, Jin Binbin, an investment manager under Today Capital, entered the board of directors of Manner and was deeply involved in the daily operation and management of Manner, while Han Yulong and Lu Jianxia were more focused on the research and development of specific products. Tianyan's investigation shows that Jin Binbin currently holds 7.2% of the shares.
"Today's shareholders and managers may have higher requirements for expansion, new acquisition, repurchase, and optimization of profit models." Feng Wei lamented that Manner had opened the store too slowly in the past, and now the pressure on the team can be imagined.
*At the request of the interviewees, Zhu Yun, Feng Wei and Chen Huang are pseudonyms.