Author丨Huai'an
Editor丨Tangerine
It has to be said that the specialization, branding and in-depth participation of the "corpse collector" (second-hand equipment recycler) have opened a gap in the current situation of the closure of the new tea beverage industry. It also makes the survival status of many enterprises in the new tea beverage industry clearer and more concrete in the dimension of "closing stores". So, Gu Ming, who wants to grab business with the "corpse collector", is he afraid of "family ugliness" or is he really thinking about franchisees?
The closure rate is quite high
Recently, Gu Ming Holdings Co., Ltd. (hereinafter referred to as Gu Ming) released the news that the "official second-hand equipment trading platform was officially launched".
In the public content that franchisees can see, Gu Ming said that due to the case of "franchisee partners were deceived by the purchase and sale of equipment through intermediaries", some outsiders took advantage of the information difference to earn the difference in equipment transactions. In order to deal with this problem, from now on, the company will carry out second-hand equipment trading business nationwide to protect the legitimate rights and interests of buyers and sellers of franchisee partners, and ensure the safety and convenience of the transaction process.
The second-hand platform serves all Guming franchisees and will be in operation from October 12, 2024. After careful study, its operation process is that the company comes forward to help new and old franchisees complete the transaction process of "second-hand equipment". Not only that, but throughout the process, Gu Ming promised to recommend the docking between franchisees, supervise the transaction and even provide assistance services and follow-up services.
In addition, "the company will charge a certain service fee, the specific amount of which depends on the situation." Gu Ming also emphasized that the cost is mainly used for equipment testing and maintenance, and personnel come to disassemble and pack.
Although it is only a "notice" of Gu Ming, it has also caused a lot of fluctuations in the tea circle.
"Franchisees don't even have the opportunity to deal with their own equipment", "Does the company want to solve the problem for dealers or does it want to make another profit", "Squidward, you can't collect Gu Ming's equipment anymore......"
Squidward, in the tea circle, is both a real person and a brand, specializing in second-hand equipment for milk tea. What he often says is to keep the "final bottom line" for tea franchisees (that is, when franchisees choose to withdraw, they can also monetize their milk tea equipment).
Of course, Squidward doesn't accept all equipment, the head brand of tea drinks, and the version of the relatively new equipment must be, and the price he can give is relatively fair.
I have to say that in September this year, because of the existence and perspective of the "corpse collector", the closure of many tea brands, including Shuyi Burning Fairy Grass, was "aired".
At that time, Phoenix.com reported that well-known brands such as Hey Tea, Nai Xue's Tea, and Shanghai Auntie accelerated their bankruptcy, triggering a wave of tea equipment recycling; In addition to the book and burn fairy grass, the recycling rate of tea Baidao and ancient tea equipment is also in the forefront.
And the ridiculous version of the closure of Gu Ming's store has also made new progress - earlier, from living to dying; Nowadays, good me is good bye.
A little flipping through Squidward's circle of friends, from the 12th of Gu Ming's official announcement to the present, at least 4 Gu Ming shops have been issued a "graduation certificate" by Squidward (milk tea equipment dismantling and realization). According to Squidward's incomplete statistics, recently, more than a dozen second-hand equipment from ancient tea shops have been recycled by their own companies every month.
The actual number of store closures is obviously higher. According to the "Blue Book on the Development Trend of Chain Catering Brand Stores in the First Half of 2024" produced by GeoQ, in the field of new tea drinks, about 17,174 stores will be opened and 8,608 stores will be closed in the first half of 2024, with an opening-close ratio of about 2.0.
Among them, the number of Gu Ming's stores in operation has reached 9,392, ranking second in the industry. They were followed by Shanghai Auntie and Tea Baidao. In the first place, Mixue Bingcheng has taken the lead, reaching 34,582 stores.
According to public information, the founder of Gu Ming is Wang Yunan, which was founded in 2010. Positioned as a mid-range tea brand, the price range is 14-20 yuan, and the main products are fruit tea, milk tea, coffee and others. It is the fourth tea beverage company in the new tea beverage industry to submit a listing application after Naixue, Mixue Bingcheng and Tea Baidao.
According to its prospectus, from 2021 to 2023, the number of Gu Ming stores will be 5,694, 6,669, and 9,001 respectively. During the same period, the number of Gu Ming franchise stores was 5,689, 6,664 and 8,995 respectively. This also means that by the end of 2023, there will only be 6 Guming directly-operated stores.
Obviously, most of the money made by Gu Ming comes from franchisees. Sales of goods and equipment to them, franchisee management services, and sales revenue from directly operated stores. As of the end of 23Q3, the revenue of its six directly operated stores accounted for only 0.2% of the total performance in the same period.
At the same time, in 2021, 2022, and the first nine months of 2023, Gu Ming's revenue will be 4.384 billion yuan, 5.559 billion yuan and 5.571 billion yuan respectively, and the net profit will be 23.992 million yuan, 372 million yuan and 1.002 billion yuan respectively.
Compared with peers, as of 2023, the survival status of Gu Ming is that its revenue is about one-third of that of Mixue Bingcheng; The net profit is less than half of that of Tea Baidao; From 2021 to 2023, more than 800 stores will be closed in three years, and the closure rate is higher than that of Chabaidao.
At present, as far as Squidward's real experience is concerned, Gu Ming's store closure is also at the head of the industry.
Gu Ming is still "worth it"
In fact, there is a wave of store closures, and the new tea industry has been shouting from the beginning of 2024 to the present.
As far as Gu Ming is concerned, the reasons for the closure of the store in 2021-2023 explained in the prospectus are: the upgrade of the store location (usually carried out when the popularity and customer flow of the business district around the store decline), the termination of the property lease agreement, or the termination of the franchisee relationship.
"In terms of the revenue composition of Gu Ming, we naturally don't want to see more franchisees close their stores. The existence of the official second-hand equipment platform can not only digest the equipment internally, allow the direct handover of new and old dealers to form a closed loop, but also reduce the spread of store closure information in the industry. An industry insider believes.
Of course, many people in the industry say that in the long run, this is a good thing. If it runs well, the brand, new and old franchisees, all three parties will benefit. This also shows from another level that Gu Ming's official recognition of the use of second-hand equipment in newly opened stores is "at least ...... than those brands that force stores to buy equipment"
Similarly, the other side of the coin means that the closure of Gu Ming has attracted official attention.
Recently, some industry insiders complained that "there is no good store in Shandong"; The so-called "good store" is actually a store that is profitable and has good profitability. As far as Squidward's personal experience is concerned, at present, the closure of Gu Ming in the Shandong market is indeed serious, and the shortest age of the store is only a few months. But this does not mean that Gu Ming does not have "good stores" in Shandong.
Not only that, "the situation of Gu Ming in the Anhui and Henan markets is not very optimistic, but it is very good in Jiangsu, Zhejiang, Jiangxi and Fujian." Therefore, each brand will have different presentations in different regional markets due to its positioning and product differences.
This point was also confirmed in Gu Ming's prospectus. "As of the end of 2023, the company has a store layout in 15 provinces in China, of which 8 provinces have reached the key scale (defined by the company as provinces with more than 500 stores), and they are Zhejiang, Fujian, Jiangxi, Guangdong, Hubei, Jiangsu, Hunan and Anhui ...... in order of reaching the key scale."
In fact, receiving second-hand equipment is not a very good business, after all, labor costs, cleaning costs, transportation costs, and after-sales maintenance costs ...... It remains to be seen how much corruption will arise in each link after Gu Ming's official participation in this area and whether corruption will arise in all aspects in the future.
As for the fact that the "corpse collector" exposed the closure of major tea brands, the octopus buddies did not shy away from it. Hey Tea, Overlord Tea Hime, Tea Baidao...... Even the recently hot jasmine milk white is also a "guest of honor". But for the "closing tide" that is coming at every turn in the industry, Squidward does not agree.
In his opinion, store opening and store closure have been happening in the industry, and there have been many store closures before, but the brands that have not opened up to join have "digested" this situation internally; After opening up the franchise, especially after many brands frantically expand their stores, it has become inevitable to "eliminate" stores with poor profitability.
The convergence view is that "store closures are also a historical necessity that brands need to face when there is an imbalance between supply and demand in the market." Constantly expanding stores and constantly encrypting, the market is too saturated, and it is inevitable to close stores. Growth difficulties, performance is less than expected, and the payback cycle is longer...... "A senior practitioner said bluntly. In his view, "low-speed growth" may become the norm in the new tea industry.
In fact, before becoming "Octopus", Squidward had been in the industry for more than ten years. These more than ten years of personal experience have made him realize that the industry has a cycle, and the brand also has a cycle. Just like the gradual edge of the industry's leading brands in the early years, the rapid development of Bawang Chaji, and the gradual decline of Shuyi Burning Fairy Grass, there is no need to panic, but whether it is a brand or a franchisee, if you want to do well, you must have the ability to go through the cycle.
"As far as the brand is concerned, the continuous change of the team, sufficient acuity, market observation ability, and execution; Reasonable delegation of power by founders and timely exit; team and product innovation capabilities......, etc., etc., "Squidward said that Gu Ming is still one of the three major brands in the industry that can still be done.
According to the prospectus, as of December 31, 2023, there are still 19 provinces in China where Gu Ming has not yet been stationed. In other words, Gu Ming still has some space, but it remains to be seen how big it can be expanded and how good it can be.
In addition, regarding the official establishment of a second-hand equipment platform, as well as the unfavorable situation of Gu Ming in the Shandong market and other issues at the development and operation level of the company, Nei Sanjun once sent an invitation to the Gu Ming official, but Gu Ming failed to reply because it was in the "silence period".
As for Gu Ming's "second-hand equipment platform", whether it can trigger the follow-up and operation of other brands in the industry can only be done and seen.