How can the catering industry innovate and change? The company announced an upgrade to the "Prosperity Plan".

It took only 13 months for Luckin Coffee to go from 10,000 to 20,000; The number of tea Baidao stores nationwide increased to 8,385, a year-on-year increase of more than 20%...... Driven by the high-quality development of catering, chaining and sinking have ushered in new opportunities, and large-scale chain brands have become the main engine of growth in the catering industry.

How can the catering industry innovate and change? Recently, the 2024 Catering Industry Conference with the theme of "Passing Through the Cycle" was held in Shanghai. The conference was hosted by the Shanghai Catering and Cooking Industry Association and Meituan, and thousands of catering companies from all over the country gathered in Shanghai to seek the future and development of the industry.

A hometown chicken "satellite store" in Xiaoshan, Hangzhou, has a ping effect of up to 6,600 yuan; Tea Baidao and Meituan created a new experience of "second delivery", driving an increase of 280,000 monthly orders; A "must-eat" mom-and-pop shop in Changsha opened 4 stores...... From brands to small stores, at the conference, various innovative models were comprehensively presented, bringing valuable experience and showing a new atmosphere of high-quality development of the industry.

Meituan announced at the meeting that it will upgrade its "Prosperity Plan" for catering businesses, and jointly promote industry innovation, release demand potential, and enhance business confidence through measures such as tens of billions of yuan to promote consumption, "brand satellite stores" 10,000 store rebate plans, new catering store support plans, and digital special projects.

AI site selection, data asset operation ......

Build a digital catering ecosystem

People take food as their day, and people's enthusiasm for "eating" has always been the same. According to the National Bureau of Statistics, from January to July 2024, the national catering revenue increased by 7.1% year-on-year.

The outsourcing of family catering demand is still the general trend, and the scale of social catering provided by catering enterprises will continue to grow. Wang Puzhong, CEO of Meituan's core local business, said at the meeting that according to Meituan data, the proportion of urban residents eating out will increase from 16.6% in 2023 to about 24% by the end of 2030, that is, each urban resident can eat out five to six times a week.

"Catering is an industry with long-term resilience and seeking change and prosperity, which is ushering in great changes unseen in 30 years and officially entering the era of deep cultivation." Wang Puzhong said that under the new cycle, the demand has entered the stock, and it is the ultimate goal of businesses to deepen the customer base and improve the customer experience.

"In the new cycle, we will strive to become a small helper for the full-scene operation of catering businesses, help merchants accumulate more data, do a good job in full-cycle consumer management, and deepen together with the catering ecology." Wang Puzhong said that Meituan has always provided long-term and stable customer source channels for catering companies, and through the integration of catering group buying and takeaway, it has helped merchants achieve double growth through "dual-home operation".

At the meeting, Wang Puzhong announced that Meituan will continue to upgrade the "Prosperity Plan" and continue to feed the industry, with specific measures including investing tens of billions of yuan to promote user consumption and promoting products through brand marketing and joint merchants; Upgrade the "Brand Satellite Store" 10,000-store rebate program to provide 6 to 12 months of commission rebate for F&B merchants; Shorten the operating account period of group purchase and improve the cash flow efficiency of merchants; Launched a special digitalization project to open up business products such as the BETTER customer growth business model, AI site selection, and operation compass to all catering employees, as well as upgrade Meituan's catering data asset operation services.

Drawing a "Business Panorama"

There are more than 1,000 high-growth satellite stores

Browse to find a store, make a decision on the list, buy and place an order, dine in the store, take out to your home, evaluate and repurchase...... More and more consumers are accustomed to completing dining choices and service purchases on the platform. According to Meituan, 275 million people solve their food and beverage needs on the platform every week, and they open the Meituan app 7.34 times per person.

This summer, McDonald's and Meituan explored the "321" growth model, created refined operations in 3 live broadcast venues and 2 distribution venues, and achieved a year-on-year increase of 151% in the volume of Meituan group purchase transactions in stores in one marketing cycle. The former Changsha mom-and-pop restaurant "Lu Ge Hotel" has been on the Dianping must-eat list for 7 consecutive years after fans of foreign diners through Meituan and Dianping, and the proprietress said, "Good taste brings more good reviews", and now "Lu Ge" has 4 stores in Changsha and has been on the Dianping must-eat list for 7 consecutive years.

In order to help more types of merchants grasp the full-cycle demand and achieve high-quality growth, Wei Wei, Vice President of Meituan and General Manager of Meituan's In-Store Catering Division, unveiled the "Panorama of In-Store Catering Operations" for the first time at the meeting, dismantling new business ideas from three levels: business infrastructure, marketing growth, and data assets.

At the same time, takeaway has become a way of life for more and more people, and the trend of "double home" with both dine-in and takeaway is strengthening. Up to now, 150 catering brands have opened more than 1,000 satellite stores on the basis of dine-in operations.

Compared with dine-in takeaway stores, the brand satellite stores jointly built by these platforms and brands have reduced store rent and decoration costs by 60%, increased exposure by more than 30%, increased order conversion rate by 5 percentage points, and single-store orders are 1.74 times the number of new store orders in the same period, with an average profit margin of 14.8%. Xue Bing, general manager of Meituan's takeaway business department, said that the brand's satellite stores have become a new type of takeaway growth and are rapidly lighting up more cities at a rate of 100 stores per week.

Chain brands are steadily expanding

Digitalization has ushered in high-quality growth

According to Meituan data, in July this year, the number of chain brand stores with more than 1,000 stores increased by more than 25% year-on-year, and the expansion rate was significantly faster than that of the social catering market and other large-scale brands. In terms of regional distribution, the sinking market shows the characteristics of "more new openings and fewer closures".

In the face of the new situation, the participating brand guests agreed that catering has shifted from "incremental" to "stock" in a new cycle, and cost control and efficiency increase driven by digital operation have become the key to high-quality development. In his speech, Jia Guolong, chairman of Xibei Catering, encouraged catering people to adhere to the original intention of the brand, not blindly follow the trend, and deeply cultivate the development of the industry. Li Hong, chairman of the village base group, said that "slow growth is a state of mind", and the pursuit of perfection and efficiency improvement is the way to deal with it. Guan Yihong, chairman of Jiumaojiu Group, also believes that the era of simply opening a store has passed, and its Taier sauerkraut fish is actively exploring new models such as takeaway satellite stores. Guo Jinyi, co-founder, chairman and CEO of Luckin Coffee, emphasized the technology-driven and supply chain improvement at the meeting.

It is understood that Shanghai has officially issued the "Several Measures to Promote the High-quality Development of the City's Catering Industry", which puts forward a total of 10 measures around cost reduction, burden reduction, energy enhancement and drainage, scene innovation, environmental optimization, etc. Jia Kang, a distinguished expert of the National Committee of the Chinese People's Political Consultative Conference (CPPCC) Talent Pool, said that the guidance of policies and technological innovation will prompt catering companies to actively build a digital and intelligent ecosystem, thereby improving operational efficiency and consumer experience, and the entire industry will inevitably be long-lasting in innovation and development.

Source: Yangpu, Shanghai