Thousands of new stores were added in half a year, and county restaurants such as Tianlala and Tustin "besieged" Beijing, Shanghai and Guangzhou

Image source: Visual China

Blue Whale News, September 10 (Reporter Sun Yu) The rise of parity is an opportunity for catering enterprises in the county.

County catering is a representative of high cost performance. From the perspective of store expansion, the data of Narrow Door Dining Eye shows that since the beginning of this year, 1,014 new stores have been opened in Tustin, a "Chinese burger", and 1,225 new stores have been opened in Tianlala, which is nicknamed "Honey Snow Bingcheng Pingti" by netizens. In addition, cost-effective catering companies such as Micun bibimbap and Xiong Meow have also entered the fast lane of opening stores.

According to the definition of Meituan New Catering Research Institute, a county catering brand refers to a chain brand whose stores are mainly distributed in the county in the start-up stage. Industry insiders said that county catering does not refer to coming out of the county, but a catering brand that is more suitable for the county, that is, it has a higher cost performance.

The county catering "besieged" Beijing, Shanghai and Guangzhou

More and more county restaurants have adopted the strategy of "rural areas surrounding cities", first making extensive layouts in sinking markets, running through store models and supply chains, and then entering first- and second-tier cities to open many chain stores.

Sweet Lala, a tea brand that came out of Bengbu, Anhui Province, although it does not have the fame of Hey Tea and Bawang Tea, the number of stores in the country is close to 6,200, and the number of stores is nearly 2,000 more than Hey Tea and more than 1,000 more than Bawang Tea.

Judging from the opening of stores, so far in 2023, the number of new stores in Tianlala will exceed 4,000. From the perspective of store layout, nearly eighty percent of Tianlala's stores are located in third-tier cities and below, and township stores account for nearly one-third of them. In 2023, Tianlala began to enter Shanghai, and has opened 15 stores so far, most of which are located in places that avoid the central city. According to the data, Tianlala has 63 stores in Beijing, Shanghai and Guangzhou, most of which have been newly opened in the past two years.

In terms of products and pricing, the sweet lala product system covers fruit tea, fresh milk tea, ice cream, etc. Among them, the price of chilled lemonade is 4 yuan, which is lower than the 5 yuan of Mixue Bingcheng, and the price of sweet lala ice cream cone is 2 yuan, which is also 1 yuan cheaper than Mixue Bingcheng. In addition, among the sweet lala products, Qingfeng Mobai fresh milk tea is priced at 8 yuan, succulent grapes are priced at 10 yuan, and a barrel of fruit tea is priced at 10 yuan, all of which are lower than other tea shops.

Tustin is another representative of county catering, with more than 7,600 stores nationwide, of which nearly half of the stores are located in third-tier cities and below, with a unit price of 18.75 yuan. Yang Keying, co-founder of Tustin, once talked about Tustin's advantages in the "county market", with stores all over the sinking market to establish a scale advantage, and he attributed the growth of Tustin's performance to the growth of turnover in the previous county market.

From the perspective of store growth, the data of Narrow Door Dining Eye shows that from 2022 to July 2024, the number of new stores in Tustin will be 2,316, 3,774, and 1,014, and the growth rate of stores during this period will exceed that of Wallace, KFC and other burger restaurants.

It is worth mentioning that the rice village bibimbap opened from the border town of Yanji has also become popular because of "all-you-can-eat for 3 yuan", and more than 800 new stores have been added in a year and a half. From the perspective of site selection, the Bibimbap store accounts for more than 5% of the stores, although the rent of the store is higher, but the restaurant widely uses "pre-made dishes", which reduces the cost of ingredients and staff. The unit price of customers is controlled within 30 yuan, which is welcomed by young consumers and has become the new "queuing king" in shopping malls around the world.

Xiong Meow came to the hot pot restaurant and made his fortune in Liaoning, which is a "dark horse" in the hot pot industry in recent years, positioning "high quality and low price", and the unit price is about 70 yuan. From the perspective of the number of stores, the data of the narrow door restaurant shows that Xiong Meow has 268 stores in operation, of which 209 stores have been added in the past year and a half. From 2023, Xiong Meow will gradually enter first-tier cities such as Beijing and Tianjin, and has nearly 30 stores in Beijing and Tianjin so far. Talking about the future expansion plan, founder Wu Hongtao told Blue Whale News, "We are north of the Yellow River, focusing on the second and third lines. ”

At present, consumers pay more attention to cost-effectiveness when dining, and county catering has also achieved great development after entering first-tier cities such as Beijing and Shanghai. According to the 2023 report released by Meituan at the beginning of this year, the average store growth rate of major county catering brands in Beijing and Shanghai in 2023 will reach 148% and 225%, respectively. The average order growth rate of medium-sized county catering brands in the first and second tier cities with the number of stores in the middle of the country (about 1,000) is as high as 94.3%, and the average user growth rate is 84.5%.

Young people are the main consumers of catering in the county

The "sinking market" has the advantages of low cost, high repurchase and stable customer source, and after the county catering has gained a firm foothold in the sinking market, it has also begun to lay out in the first-tier cities. Taking Tustin as an example, public information shows that by the end of 2023, Tustin has basically achieved full coverage in the southern region, and the scale effect and supply chain have matured, which also lays the foundation for its development in first-tier cities.

Industry insiders believe that the county catering pays more attention to cost control, and is more in line with the current young consumer groups in terms of product strategy and store location. In order to reduce costs, most of the locations of county catering stores in first-tier cities are located at the edge of business districts, around communities, street corners and other places with low rent costs, and they also save as much as possible in store decoration.

After entering the first-tier cities, most of the stores in county restaurants such as Tianlala and Tustin are located in places with low rent premiums such as street corners and community schools, which reduces the cost of opening stores to a certain extent. Although most of the rice village bibimbap is located in shopping malls, it is in the form of pre-made dishes to reduce the cost of ingredients and labor.

According to Meituan's data, in first-tier cities, users aged 20-35 are the main force in the growth of consumer brand consumption in the county, and young consumer groups such as student parties and office workers are also the main force in group buying, hoarding coupons, and ordering takeaways.

The "siege" of county-town catering in Beijing, Shanghai and Guangzhou is also in line with the current consumer's pursuit of cost performance, which corroborates the decline in consumption data in first-tier cities in the first half of the year. In the first half of 2024, the growth rate of the two places will be 8.8 and 4.7 percentage points lower than that in 2019 to -2.3% and -0.3%, respectively, and consumption in Hunan, Hunan, Henan, Sichuan and other places has a strong growth momentum.

In addition, income growth is also an important factor affecting consumption, and the per capita disposable income growth in Beijing, Shanghai and other places in the first half of 2024 is small. According to the National Bureau of Statistics, in the first half of 2024, the per capita disposable income of urban residents increased by 4.7% and that of rural residents increased by 6.9%. Shenwan Hongyuan research report pointed out that in the first half of 2024, the per capita disposable income in Beijing, Shanghai and other places will only increase by 4.2% and 4.4% year-on-year, ranking last in the country.

It is worth mentioning that while the county catering is "besieging" Beijing, Shanghai and Guangzhou, the mid-to-high-end restaurants represented by Haidilao and Starbucks are busy exploring the sinking market. After Haidilao opened its franchise in March this year, the proportion of applicants from third-tier cities and below was relatively high. In addition, analysts believe that Haidilao's sub-brand Xiaohi hot pot is also more conducive to the development of the sinking market in terms of the setting of the unit price, and the unit price has also been reduced from 70-80 yuan to about 50 yuan now, and the bottom of the mandarin duck pot has dropped from the original minimum of 19.8 yuan to 9.9 yuan.

According to Haidilao's 2024 semi-annual report, the contribution of first- and second-tier cities to revenue decreased slightly year-on-year, and the proportion of revenue in third- and lower-tier cities increased from 38.2% in the first half of 2023 to 39.9% in the first half of this year.

Starbucks plans to open 9,000 stores in the Chinese market by the end of 2025, and the sinking market is seen as the key to store expansion, with more than 3,000 counties included in the strategic vision. As early as two years ago, Starbucks China's chief operating officer said that Starbucks not only values more than 300 prefecture-level markets across the country, but also nearly 3,000 county-level markets.

Is the sinking market contrary to the high-end strategy? Industry insiders believe that under the trend of narrowing the income gap between urban and rural residents, consumers in the sinking market are in a state of consumption upgrading, and they also have social needs, and there is a demand for high-end restaurants, cafes and other consumption scenarios. In the final analysis, high-end catering brands are increasing their weight in the sinking market in the hope of turning the population of nearly 1 billion in the sinking market into potential consumers.

From this point of view, the county catering "besieged" Beijing, Shanghai, Guangzhou and high-end catering to enter the sinking market, forming a two-way grand situation at present. A consumer told Blue Whale News, "Now, after returning to their hometowns during the holiday, they can also enjoy the lifestyle that they are accustomed to in first-tier cities such as Starbucks and Haidilao, and at the same time, hometown restaurants such as Tianlala and Tustin are also increasingly opening into first-tier cities, and the choices are more extensive and diverse." ”