Written by / Yang Qian
Edited / Mao Shiyang
Recently, the green tea restaurant has passed the hearing of the Hong Kong Stock Exchange, and if all goes well, it will land on the Hong Kong Stock Exchange as early as the end of March. In order to go public, in less than a year, the original internet red restaurant "Green Tea" submitted a prospectus many times.
As early as March 2021, Green Tea Restaurant handed over the first edition of the prospectus, but then it was pointed out that there was a "letter phi error" in the Chinese version of the prospectus, and the "total current liabilities" that Green Tea should have disclosed in the prospectus became "total current assets", and the net current assets of Green Tea Group for several consecutive years were at a negative level, but because of "carelessness", the figure "turned negative to positive".
In this regard, the green tea group officially responded and made amendments, and in October 2021, the green tea group once again submitted a prospectus.
Mistakes in the prospectus can be modified, but there is still doubt about whether it can be successfully listed. Since 2008, green tea restaurant has rapidly developed into a "net red" restaurant because of its cost-effective and beautiful environment. However, after 14 years, with the opening of internet red restaurants one after another, green tea restaurants have long had no new stories, and the former high sex ratio advantage has gradually been replaced, and young people will no longer equate the word internet red with green tea restaurants.
According to the new prospectus, 60 new green tea restaurants were added in 2020, but the total number of customers served fell from 29.7 million in 2019 to 25.6 million in 2020. Green Tea Restaurant plans to increase the rate of store opening in the next few years to 75 to 100 per year, and increasing the speed of opening stores in the case of reduced customer flow can make this former Internet celebrity restaurant popular again?
(Source: Visual China)
Internet celebrities are hard to red again
Contemporary young people are more picky about food than green tea can imagine.
Some consumers told Caijing Tianxia Weekly that the current specialty products of green tea are still a few years ago, "If you really don't know what to eat, you will generally go to a green tea restaurant." ”
In the catering market where internet celebrity brands are constantly iterating, green tea is rarely thought of today. In the top 50 annual catering brand list released by Winshang Network over the years, the last time green tea restaurants were listed was in 2016, and they have not appeared since then, and green tea restaurants are getting farther and farther away from the logos of "fashion" and "net red".
This has a direct impact on the attractiveness of green tea restaurants in first-tier cities. The prospectus shows that consumers in the most spending first-tier cities are leaving green tea restaurants and going to other restaurants. From 2018 to 2021, the turnover rate of green tea restaurants has decreased significantly. The turnover rate fell from 3.48 times/day in 2018 to 2.62 times/day in 2020, and rose to 3.32 times/day on September 30, 2021, but it is still far from its peak.
Green tea restaurant is still the era of "net red", the turnover rate is the advantage of green tea, the highest average daily turnover rate can reach 6-8 times. Previously, Wang Qinsong, the founder of Green Tea Restaurant, said that the turnover rate of Green Tea Restaurant has its own lower limit and upper limit: in the state of ensuring the normal work of chefs and employees, the turnover rate of 4 times a day is the lower limit, and 7 times is the upper limit, which can ensure that the profitability of the restaurant can also ensure that the customer experience will not decline.
In contrast, among other listed companies in the catering industry, in the first half of 2021, Haidilao's turnover rate reached the lowest 3 times / day in history, but in the eyes of industry insiders, Haidilao's hot pot category has a lower turnover rate, and the per capita consumption of green tea restaurants specializing in stir-fry dishes is lower, and the turnover rate is higher.
"(Turnover rate) 4 times is a threshold for mass catering, if it is not reached, then it may be necessary to consider whether there is any problem (business strategy)." In this regard, Wang Qinsong believes.
Behind this, the new product market of green tea restaurants has not performed well, and although a large number of new products are launched every year, they have not attracted much attention. At present, the outside world is still paying more attention to the three traditional green tea dishes of green tea roast chicken, bread temptation, and stone pot tofu. But inside the green tea restaurant, there are 4 research and development cycles every year, updating nearly 20% of the dishes. In 2020, green tea restaurants launched a total of 147 dishes.
In addition, the marketing of green tea restaurants has not reacted quickly in the new "internet celebrity era". Until the end of 2019, the green tea restaurant opened an official Weibo, the official Douyin account was also opened in 2021, at present, its official Douyin account has only more than 1,000 fans, and the video has only been updated by 5.
Limited brand power and insufficient innovation directly affect the profitability of green tea restaurants.
The low unit price and the declining turnover rate naturally make green tea perform flat in terms of profitability. From 2018 to 2020, the revenue of Green Tea Restaurant was 1.311 billion yuan, 1.736 billion yuan and 1.569 billion yuan, respectively, and due to the large cost, the net profit was 44.401 million yuan, 106 million yuan and -55.262 million yuan, respectively.
In the first nine months of 2021, Green Tea achieved revenue of 1.694 billion yuan and net profit of 94.85 million yuan. Even if the green tea restaurant has turned a profit, it has not eliminated the industry's concerns about the profitability of the green tea group.
"Harvest" sinking markets
So far, green tea restaurants have 236 restaurants across the country, of which 60 were added in 2020 and 56 in 2019, and its stores have nearly doubled in two years. Previously, in 2008, after green tea restaurants opened the first directly operated restaurant stores in Hangzhou, at the end of 2009, green tea began to enter Beijing, Shanghai and Guangzhou, and in ten years, the number of green tea restaurant stores exceeded 100 in 2018.
Green Tea Group also intends to continue to expand. According to official information, Green Tea Restaurant plans to open 75-100 new restaurants per year from 2022 to 2024, most of which will be opened in lower-tier cities.
In the face of the saturation of the number of restaurants in first-tier cities and the high cost of operation, green tea restaurants have also begun to sink, bringing their own cost-effective to second- and third-tier cities. At present, Green Tea's restaurants cover all first-tier cities, 12 new first-tier cities, 26 second-tier cities and 26 third-tier cities and below.
At present, green tea restaurants that are eager to go public are starting from group purchase e-commerce, and regain their popularity with the help of KOLs and shop bloggers.
Chen Chen, a "post-90s" who lives in Hebei, often brushes douyin, and recently, he suddenly found that douyin often pushes live broadcasts and group purchase promotion videos about green tea restaurants. The Douyin platform has more than 60 accounts related to green tea restaurants, and various videos are posted on the platform every day.
"Finance and Economics" Weekly learned that "9.9 yuan of bread temptation, 9.9 yuan of green tea roast chicken half", low-cost explosive products have become a means of attracting green tea to attract customers.
But in lower-tier cities, these promotions are difficult to highlight the value for money of green tea restaurants. In fact, in the early days of green tea, it was famous for the cheap dishes such as 5 yuan of cucumbers and more than a dozen yuan of steak bone fried rice cakes, and the use of low-price dishes was opened in shopping malls and other places where the traffic was concentrated, and the per capita consumption of less than 60 yuan was also one of the reasons why it became popular with the public, which was also the reason why the green tea turnover rate was extremely high at that time.
At present, the price of a pepper crisp cucumber in some green tea stores has reached 10 yuan per serving, and the highest dish is a dish with added yellow croaker, which is priced at 98 yuan. Green Tea's prospectus also shows that per capita consumption has also begun to rise on improved menus and innovative menus, especially with the introduction of several new dishes with higher prices, from 54.8 yuan in 2018 to 60.2 yuan on September 30, 2021.
Chen Chen found that green tea restaurant opened its first store in a popular shopping mall in its city shortly after the beginning of 2022, and the location was located next to the popular restaurant of Haidilao hot pot. However, what makes Chen Chen, a post-90s consumer, wonder is that the anchor told her that the coupon "only 83 stores in the country can enjoy the discount", and the third-tier cities where he is located are not listed.
(Screenshot from: Green Tea Group Prospectus)
When mentioning the expansion strategy many times, Green Tea said it would expand its market share in the existing regional market, of which lower-tier cities became the main areas of its expansion.
Lin Yue, chief consultant and catering analyst of Lingyan Management Consulting, believes that market sinking is one direction, but there are also many challenges. For example, facing the encirclement and suppression of regional brands, such as the problem of dish water and soil dissatisfaction, talent faults, etc., are all challenges for green tea.
However, he also said that the current offline operating environment is still uncertain, and the pace of expanding the number of stores should be more cautious.
"Disappearing" sub-brands
In fact, the concentration of the domestic catering market is low. In the catering market, third-party agency China Insight Consulting data shows that in 2020, the revenue of green tea restaurants accounted for 0.5% of the domestic leisure Chinese restaurant market. Xibei has 372 stores with a market share of 1.6%; there are 283 small vegetable garden restaurants with a market share of 0.7%; and Taier Sauerkraut fish has 233 stores with a market share of 0.6%.
The market share of the 4 catering brand giants together accounts for less than 5% of the domestic catering market.
In addition to focusing on Chinese casual meals, Green Tea Restaurant has also expanded other businesses or crossed other catering fields to expand its sub-brand.
During the epidemic, Green Tea has also developed a takeaway business. According to the prospectus, the revenue generated by Green Tea's takeaway service fell from 255 million yuan in 2018 to 218 million yuan at the end of September 2021, and the proportion of restaurant operations still exceeded 80%. For the proportion of takeaway business, Green Tea Restaurant explained in the previous prospectus: "Mainly due to the strategic focus on restaurant operations, resulting in a decrease in takeaway orders."
In addition, green tea has also quietly launched the Miaohui Mall, and will launch gift box products on the Mini Program during the New Year's Festival, but at present, the goods that can be bought in the Mini Program are only more than 10 models such as lotus powder, aromatherapy gift boxes, and light wine, and the sales volume is basically only below 100 singles, which is rarely known.
Western food and stews cannot be associated with green tea restaurants. In 2014, Green Tea Restaurant founded the Tohoku stew brand "Kanto-made"; in 2015, Green Tea founded the Western food brand "Play king player flame pancake".
Green Tea Group has developed several new brands, and has also continued the model of green tea restaurants in the target market and price positioning, with per capita consumption positioning at 40-50 yuan, and the address is selected in the prime location of the mall, taking the integrated popular catering route. However, according to industry sources, several "sub-brands" are generally popular, although the environment and products are still doing well.
At present, most of the brands under green tea have disappeared from the market.
After failed new business attempts, the "Green Tea Restaurant" brand became the only hope. In Lin Yue's view, the listing is definitely what Green Tea has always wanted to achieve, and it is also a practice to break through the bottleneck at this stage, first, its new brand has not been successfully incubated, and second, there are not many new explosive points, so if the listing is successful, it will bring certain attention in the short term, and then seek expansion will be more confident.
However, the lack of "explosive" green tea restaurants, even if the listing to obtain funds, relying on capital alone can turn red is still a question.