With more and more powerful chain brands embracing franchise, the competition in the restaurant chain franchise market is becoming more and more fierce, and only high-quality catering brands have a greater chance to stand out.
This article was originally published by Red Meal Network (ID: hongcan18), author: Zhou Mo, editor: Wang Xiuqing.
Following Jiumaojiu and Haidilao, Red Meal Network recently found that another chain catering brand with nearly 200 directly-operated stores is open to joining!
It is understood that the brand's goal is to increase the number of directly operated and franchised stores from the current level to more than 1,000 in the next five years, and the total number of stores will increase by 5 times.
In fact, since entering 2024, in the face of new changes in the market environment, many chain brands have become cautious about accelerating their expansion and have slowed down the pace of store opening, while the above brands have set such ambitious expansion targets.
Who is this brand, and what is the reference value of the business code behind it for other chain catering enterprises?
And the brand has been open to joining,
The company plans to exceed 1,000 stores within five years
In recent years, the rate of restaurant chains in China has continued to rise. According to the "2023 China Catering Franchise Industry White Paper", from 12% in 2018 to 19% in 2022, the chain process of China's catering market is accelerating. Entering 2023, the scale of China's catering industry will reach 5.28 trillion yuan, and the chain rate will exceed 20%, hitting a record high.
However, compared with the 54% restaurant chain rate in the United States, the chain rate of China's catering industry still has a lot of room for growth, which is also one of the main reasons why catering companies are opening up to franchise to improve the scale of the chain.
Red Meal Network learned and found that the brand that was open to join this time is a grilled fish brand from Guangzhou, Guangdong Province - Shi Roasted Bean Flower Grilled Fish (abbreviation: Shi Roast). At present, its WeChat public account has opened the entrance to consult and join.
Since its establishment in 2019, Shiba has been insisting on expanding in a direct way, and as of April 25, 2024, it has opened and has signed more than 200+ directly-operated stores, mainly in Guangdong, Guangxi, Fujian, and Hainan. In 2024, in addition to continuing to cultivate South China, it will also set its sights on the two major regions of East China and North China, and has formulated a plan to lay out overseas markets, which is expected to exceed 1,000 stores within 5 years. This means that in the next five years, Shiba will open at least 160 new stores every year.
Red Meal Network understands that Shi Bake also has certain requirements when choosing franchisees, such as recognizing the brand and development concept of Shi Bae, having a long-term business concept of common development, having a good spirit of cooperation, and having a global view.
In terms of store opening support, Shi Bake adopts a one-stop assistance measure, that is, franchisees who have signed a successful contract can enjoy eight store opening supports: site selection, decoration, training, opening, supply chain, platform operation, product development and marketing.
In terms of investment budget, to open a 200-square-meter bakery, the landing capital is about 1.15 million. In order to open a store quickly, Shi Bake has also launched a certain degree of fee reduction. For example, the first 20 franchisees who have successfully signed a contract can also be exempted from an additional opening support fee of 10,000.
It is worth mentioning that all franchisees who can get the top 100 shopping malls in the country can enjoy a certain discount on the brand usage fee.
From the region to the whole country, what are the odds of winning the division?
Red meal big data shows that the grilled fish market has exceeded the 100 billion mark as early as 2022, and in recent years, the scale of the grilled fish market is still rising. However, at the same time, the chain rate of grilled fish is relatively low, with more than 100 grilled fish brands accounting for only 10.1%, which means that there are still many opportunities in the grilled fish track.
At present, nearly 9 percent of the stores are distributed in South China, which has a certain reputation and influence in the local area, and continues to cultivate the South China market, which can further consolidate its position in South China. With the help of the franchise model, it is indeed a good choice to seize the two big cakes of East China and North China by selecting high-quality franchisees, but at the same time, cross-regional development also puts forward higher requirements for the maturity, management level and supply chain capabilities of the brand model.
Looking back at the development process and brand building process of Shi Bake, it is not impossible to win the East China and North China markets if it wants to go out of South China.
First of all, 150 new directly-operated stores were opened in a year, showing the strong expansion ability of Shiba.
Shi Bake was founded in 2019, and soon after the opening of the first store, the epidemic ushered in, but in the past three years, Shi Bake has not been affected by the market, but has bucked the trend under the epidemic and continued to expand stores. In just one year, nearly 150 directly-operated stores have been opened.
In the past year, many catering companies admitted that the market environment was more difficult than the three years of the epidemic, but Shi Bake opened hundreds of directly-operated stores in just one year, showing the brand's strong development momentum and market expansion capabilities. Therefore, Shi Grill has become a phenomenal brand in the grilled fish industry in 2023. This report card is not only a proof of the past achievements of the company, but also the strength and confidence of its open franchise, which to a certain extent represents the potential of the business model and profit model of the company.
Secondly, forward-looking layout and planning capabilities to solve the worries of store expansion.
Before deciding to open up the franchise business, Shiba has started the construction of the talent echelon in a forward-looking manner, and has now built a professional team integrating the operation department, marketing department, training department, audit department, development department and supply chain department.
In order to improve the professional skills of the team, Shi Bake also specially built a training business school at the headquarters, and the establishment of the business school is not only for the training of front-line employees, but also plays the role of a talent incubation base, paving the way for the franchise business, such as reducing the troubles and pressure of franchisee training personnel through continuous output of management personnel.
In addition, in the construction of the supply chain, Shiba has established a stable cooperative relationship with many suppliers, which not only ensures the stability of the supply of goods, but also ensures the quality of products, and provides a foundation for expanding stores in the national market. In addition, centralized and bulk procurement often means higher bargaining power and lower procurement costs, so that the profitability of franchised stores is greater.
Such a forward-looking strategic layout not only allowed Shiba to buck the trend during the epidemic, but also laid a solid foundation for its opening up of franchise business.
Third, direct sales and franchise dual-track parallel, with the regional agency model to quickly seize the market.
It can be seen from many angles that the division is well thought out, such as in the expansion model, still maintain the strategy of direct sales and franchise dual-track parallel; in the selection of the market, it will be preferred to enter the market with market potential and consumption potential; in the way of cooperation, it is not to choose the model of single-store franchise, but to cooperate through the way of regional agents, the provincial capital city should have at least 5 stores, and other cities should also have 3 stores.
Through this regional agency cooperation model, it can not only help brands screen out partners with strong financial strength and rich experience in catering operations, but also ensure the survival rate of stores. At the same time, the large-scale and centralized store opening strategy helps Shi Bake to quickly occupy market share in the short term, form a brand moat, and effectively resist the impact of competitors.
Whether from the goal setting, market selection or decision-making level, all of them show the strategic determination of the brand. These will be the key elements of its rapid expansion.
Changed by the situation
Shi roast to the ultimate quality and price ratio to seize the market
With more and more brands open to joining, franchisees have more choices, and the catering franchise market has gradually moved from a "seller's market" to a "buyer's market".
This means that for catering companies that want to expand their market and brand influence through franchising, they can continue to seize the market by actively embracing changes, continuously meeting consumer needs based on market trends, and continuing to reshape their business and operation models.
At present, "quality-price ratio" is gradually replacing "cost-effective" and becoming the mainstream trend of catering consumption, and catering brands also need to change according to the situation. Sun Yulin, a distinguished professor at the University of Chinese Academy of Sciences, pointed out at the "2024 China Catering Industry Summit" that with the decline in consumer purchasing power due to changes in the economic environment, the trend of consumption downgrade is becoming increasingly significant. In the face of this situation, the key to the breakthrough of catering enterprises lies in focusing on quality and replacing the traditional cost performance with excellent quality-price ratio.
As early as 2020, when its first store was transformed and upgraded, Shi Roast forward-looking launched the "three-yuan self-service + five free" model. Consumers only need to pay 3 yuan to enjoy ice cream, bottled drinks, flower tea, rice and other products in the self-service area, at the same time, paper towels, tea tables, pre-dinner snacks, children's packages and other daily consumption items are given away for free, and the signature black bean flower is free to renew, which fully reflects its great importance to consumer value experience.
In particular, the rice is cooked in a smart rice cooker to ensure the taste, beverages such as cola and sprite are bottled with more value, and beverages such as flower tea and bamboo cane horseshoe are made from real tea leaves and raw materials instead of powder, further enhancing the value of the product.
With the business philosophy of "quality is king, quality and price ratio is supreme", Shiba accurately meets the market demand in the context of consumption downgrade, creates a unique competitive advantage, and has won wide praise from consumers. By the end of 2023, the number of private domain users of the Shibake brand has reached 3,000w+. In March this year, Shi Roast also won the award of "No. 1 Grilled Fish Brand in National Consumer Satisfaction" issued by Frost & Sullivan.
There is no doubt that at a time when consumers are paying more and more attention to the quality-price ratio, Shibake will promote this business model of the ultimate quality-price ratio to other cities, which undoubtedly has huge market potential.
Conclusion
With more and more powerful brands joining the franchise camp, the catering franchise market has also shifted from the barbaric growth stage to the rational growth stage, for franchisees, they have more and more choices, and the brand's popularity, the maturity of the model, and the management level will become an important factor affecting the decision-making of catering entrepreneurs. In the future, only high-quality players entering the franchise market will have the opportunity to stand out in the fierce market competition.
Looking at KFC, McDonald's and other brands all over the world, franchising is only a means, and stable product output, organizational management and supply chain capabilities are the key elements to support them to cross the market development radius and blossom in the global market. Therefore, for chain catering brands that want to achieve rapid expansion through franchising, like Shi Bae, opening up the franchise is just the beginning, and "1,000 stores" and "10,000 stores" are not just a slogan.
What kind of answer sheet will be handed over by the teacher, we will see in 5 years.