Quanjude, which had made it onto the hot search list due to consecutive losses for three years002186.SZ), and this year's performance has clearly warmed up. Quanjude got rid of the past this year3Is the annual loss indicative of a warming up in the chain restaurant industry this year? What are the reasons for the industry's recovery? Have time-honored brand chain restaurant enterprises represented by Quanjude emerged from the downward trend? What challenges will they face in the future? What challenges do time-honored brand enterprises still need to face in the future?
Frost & SullivanFrost & SullivanZhang Jian, Partner and Managing Director of Frost & Sullivan's Greater China Region, was interviewed by Time Weekly to discuss the development of the Chinese chain restaurant industry.
*Click "Read the Original Article" at the end of this text to read the complete report.
Time Weekly
Q
Quanjude got rid of the past this year3Does the year-over-year loss indicate that the chain catering industry has seen a recovery this year? What are the reasons for the industry's recovery?
The recovery of Quanjude from losses not only indicates a significant release of catering consumption demand in China, with a noticeable rebound in the catering market, but also reflects the success of the company's own strategy. During the reporting period, Quanjude focused on the strategic positioning of a leading diversified catering industry group in China, promoting the completion of various tasks. In the catering segment, profitability was further consolidated, with significant achievements in dish innovation and adjustment; in the food segment, the foodization project of catering products was advanced in an orderly manner, continuously creating star hot-selling items. Both segments showed a healthy development trend in operations.
Reasons for the continuous recovery of the catering industry:
（1consumer promotion policies
2023year7month31On the day, the National Development and Reform Commission issued the 'Notice on Resuming and Expanding Consumption Measures' (hereinafter referred to as the 'Notice'). According to the 'Notice', in terms of expanding consumption in catering services, relevant departments will focus on the following four areas:1Advocate healthy dining consumption, oppose food waste, support localities in hosting food festivals, create distinctive food districts, and carry out activities to promote dining consumption.2Optimize catering venues according to local conditions and extend operating hours in accordance with relevant regulations.3) Cultivate “ breeding and planting bases+central kitchen+cold chain logistics+The 'Catering Store ” model aims to tap into the potential of the pre-prepared food market, accelerate the construction of pre-prepared food bases, fully embody the principles of safety, nutrition, and health, and improve the quality of catering and the standardization of distribution.4Promote transparent kitchens to ensure consumers can eat with confidence. Overall, the policies mainly focus on creating food events, developing the nightlife economy, promoting the construction of prefabricated dishes, and facilitating open kitchens and cooking areas to expand dining service consumption.
（2) Recovery of the tourism market
Since the optimization of epidemic prevention and control policies this year, the Ministry of Culture and Tourism has been continuously working on both supply and demand sides, introducing a series of policies to boost cultural and tourism consumption. These measures have promoted the concentrated release of tourism market demand and a significant increase in residents' travel frequency, playing a huge comprehensive role in driving up related consumption. Statistical data shows that2023In the first half of the year, the total number of domestic tourist visits reached23.84Yi, an increase compared with the same period last year9.29100 million, a year-on-year increase63.9%; Achieve domestic tourism revenue (total tourism expenditure)2.3trillion yuan, an increase compared with the same period last year1.12trillion yuan, growth95.9%The number of tourist arrivals and revenue both reached the expected target of 'double growth' year-on-year.
（3Self-rescue of catering enterprises
Since the beginning of this year, despite facing various unfavorable factors, major catering enterprises have still been actively seeking self-rescue through various means such as takeout, carry-out orders, ready-made dishes, and product structure adjustments.
Q
Are the time-honored brand chain catering enterprises represented by Quanjude out of the downward trend? What challenges will they face in the future? What other challenges do time-honored brand enterprises still need to face?
Post-pandemic era, big data+Empowered by technologies such as artificial intelligence, supported by supply chain transformation and the new retail wave, brand catering chains have advanced with great momentum. Many entrepreneurs have found new entrepreneurial opportunities both within and outside local service giant platforms. Compared to these 'newcomers' in the catering market, established brands such as Quanjude are gradually emerging from their downward phase and beginning to innovate and develop. As the traffic dividend gradually subsides and customer acquisition and operational costs continue to rise, how catering brands build their own traffic pools and manage them has become a hot topic of concern across the industry. However, the formation and subsequent operation of traffic pools ultimately depend on the brand. The concept of a brand is not only about mental possession and trust endorsement; a good brand image itself is a huge traffic source. This is precisely the advantage that established brands possess.
Future challenges may include:
（1(Catering consumption pays more attention to food safety and nutritional health.)
Food safety and nutritional health are the cornerstones of the catering industry. After the pandemic, consumers' attention to their own health and demand for healthy diets have reached a new level, placing greater emphasis on the healthiness and nutritional balance of ingredients. Therefore, businesses need to focus on solving the problem of unpalatable nutrition and vice versa, providing more delicious and healthy food.
（2Return to the mainstream price range
Currently, the competition in China's chain catering industry seems to have entered the second half. After the adjustment of epidemic policies and the industry's recovery, only brands within the mainstream price range can continue to develop and grow. This is because large-scale expansion is fundamental to the development of chain fast-food brands.
（3Diversification
After three years of the pandemic, China's rapid growth has slowed down, and the demographic dividend is gradually disappearing. However, competition continues to increase, and Chinese catering has entered a period of stockpiling. Returning to the mainstream price range is not enough to support a brand's long-term development; a healthier approach is to enhance store growth, leading to repeat purchases, that is, to expand product categories.
（4) into a new operating model
Driven by consumption upgrading and the construction of new infrastructure, Chinese restaurants have entered an era of new operational models centered on serving new customer groups' needs, with new product services and technologies as breakthrough points. Unlike traditional restaurant operations, Chinese restaurants under the new operational model have achieved digital management of their stores, introduced intelligent technology equipment, effectively reduced labor costs, and enhanced store operational capabilities. Under the new operational model, catering enterprises should continuously innovate and transform. On one hand, they should innovate infrastructure construction. AsSaaSsystems, mobile payments, big data, andAIWith the development and popularization of digital technology, the digital upgrading and transformation of catering businesses is of great importance. On the other hand, innovate operational models. Catering enterprises need to constantly innovate in product and service design, continuously improve quality, and utilize big dataAIOptimize marketing methods and business models, explore new business forms, build an 'multi-level, diversified' product system, and achieve scale growth.
（5) Transform marketing methods
In marketing, Chinese catering enterprises need to not only focus on product quality but also pay attention to store decoration and corporate cultural image. The interior decoration style and atmosphere of Chinese catering brands have a direct impact on attracting customers. Creating a meaningful corporate brand culture can make the enterprise more popular among consumers.
* This interview was published in Time Weekly Reporter: Guo Peng, original title: After three consecutive years of losses, Quanjude's net profit in the first three quarters of this year soared140%Queuing at Beijing Qianmen Store for the Spring Festival232table ">
