Gluttony group performance cliff fall share price continues to sit on the slide, and recently issued a succession of executive turmoil, cobbled together the departure of CEO Zhang Zhenwei, the group's president Zhao Yi first be cut off and then removed from the executive director. Although the 2020 financial report shows that the gluttony group on the books is still lying 1 billion, but the chaotic brand status, positioning and revenue situation, people can not help but wonder how long the once affordable fast food small hot pot can still fire?
Gluttony and Zhao Yi have their own problems, the biggest one is that they are not on their own position. Only in the changing times to find and be sure of their own appropriate position, will not be in a big mess, otherwise it is the blind riding a blind horse in the middle of the night in the deep pool. Gluttony feed a senior said to the media management has been completely wiped out, "as if the ship is going to sink, we all hurry to run, the company is now in fear."
Out now YOUNG Caijing
Written by Wang Weiwei, Sun Yingzhou, and Zhang Dazhi
Edited by Wang Wei Pictures of the company. The company made another announcement on May 21, saying that "because the performance of some of the group's sub-brands did not meet the expectations of the board of directors", the company dismissed the CEO Zhao Yi and replaced her with the chairman of the board of directors He Guangqi; and on the evening of June 14, the company made another announcement, saying that "because of the significant differences between Ms. Zhao's management style and philosophy and that of the other members of the board of directors", the board of directors resolved to convene a special general meeting of the shareholders to dismiss Ms. Zhao Yi Ms. Zhao Yi's position as executive director.
Gluttony issued a notice of termination of contract with the executives, so unforgiving, using the words "due to the performance of a number of sub-brands of the group did not meet the expectations of the board", "management style and philosophy and other members of the board of directors there are significant differences", so that the conflict between the two sides is deep. The two sides are in deep conflict.
Zhao Yi's ability and style
In an interview with Sina Finance, senior executives at Gluttony said that President Zhao Yi was forced to take a leave of absence in late April, and that her resignation came out of nowhere. Zhao Yi joined Gluttony in 2012 as chief financial officer, mainly responsible for auditing, accounting, financial management and information technology-related matters. To be dismissed, Zhao Yi in sip feed has been working for 9 years. 2014, Zhao Yi as chief financial officer experienced sip feed Hong Kong stock listing, the role of key. Figure / "Gluttony people" inside the publication
Zhao Yi Minjian CEO Zhang Zhenwei departure triggered the capital market on the Minjian prospect of the worry, so that the sip of the feed stock price fell consecutively. Even Goldman Sachs hinted in a report that Zhang Zhenwei had a strong executive presence in the past, and investors need to be aware of the risks associated with the departure of the CEO of Minzu. On the contrary, the gluttony of the CEO, executive director Zhao Yi departure so fierce, the market did not have such reminders.
According to the "financial" reported sip feed group internal also questioned Zhao Yi's ability. A departing presidential executive was not optimistic about Zhao Yi from 2019 when she was promoted to CEO, "We think the future of Gluttony hangs in the balance."
After Zhao Yi was dismissed for the second time, He Guangqi, chairman and CEO of Gluttony Group, issued a "letter to all partners", in which he said it was "an appropriate flow of inappropriate people".
In sip feed management, a number of executives that Zhao Yi brought serious internal conflict, can not accept its management style, do not want to leave the internal conflict. Including previously retired former executive director Yang Shuling. Yang and He were patriarchal figures who fought together, and after Yang resigned as the company's executive director and group chief executive in August 2019, Zhao took over her position. One chief executive said Yang Shuling would not have chosen to retire so early if she was not very disappointed.
One executive cited an example of how he was in the normal course of his work, when he encountered Zhao Yi coming to He Guangqi to make a comment that caused He to question his work. "I had to explain to He Dong, provide more evidence to express my thoughts, and take out a large amount of time to talk to him round by round." He believes that "Zhao Yi behind the back of the people to create some unfounded things, like a child out of insecurity 'competition for favor mentality', in front of He Dong snitching, to create obstacles to other people's work."
But YOUNG Finance checks found that if the screenshot is zoomed in to see, the market value of Gluttony Holdings in fact from February 19, 2021, continued to fall, and Zhao Yi provided Gluttony Holdings market value performance continued to rise does not match.
But in 2019, for example, in what is almost the best year for the hot pot industry, the year-on-year growth rate of Gluttony's annual revenue fell from 29.2% to 27.4%, net profit attributable to the mother of the year decreased by 37.7%, the growth rate of same-store sales fell from 2.1% to -1.4%, and the turnover of the table was 2.8 to 2.6.
Gluttony's branding performance is also not ideal.
From 2016 after opening the first high-end hot pot product line cobbled together, the brand diversification road of sip and feed is in a mess. Some experts in brand planning say that the multi-brand strategy of sip feed is confusing, and there is very little differentiation between the sub-brands, some of which are not even well separated from the name, such as sip feed food, sip cook sip shabu, in xibabuxiabu.
Minute Maid, In Xiabuxiabu, and sip feed sip feed are all using a consistent tea rice tea and the same price and the same products; in the vegetables In the vegetables, meat and other products end, the three also showed some similarity, the most obvious embodiment in the vegetable platter. Multiple brands of dishes, decoration, customer base, market mind almost mixed together, the long term development of the group is bound to be unfavorable.
But in xiabuxaibu led by Zhao Yi is not such affordable positioning, and Light-pot, upgrade 2.0, also completely inconsistent with the Uniqlo model. And in the company's 2020 annual report, in xiabuxiabu it is not mentioned at all.
Although the brand name from the patchwork and sip and feed there is a separation, but from 2017, for various reasons, patchwork and sip and feed relationship "more tangled", the two brands are increasingly homogenized, seems to be sip and feed copied patchwork, which makes the patchwork team feel aggrieved. In addition, there are industry insiders broke the news that "sip and feed the internal and patch together and not, sip and feed their own PR soft basically do not let take patch together, said can not use sip and feed the resources to patch together free publicity".
A former management team in the minutiae team before leaving the sip and eat to see the minutiae revenue optimism, there is the intention to imitate, she believes that this development will lead to the minutiae "like a lost soul", and sip and eat has gone in the wrong direction: "sip and eat bias fast-food attributes, cost-effective, and different from a big restaurant like minutiae. And Minatopia such a big catering is different. The big catering to have their own soul, pay attention to the customer's whole process of experience, Minatong pay attention to the tea culture, equal hospitality. There is a natural difference between the Gluttony and Minzu models. If Gluttony does this service, it will certainly be deformed."
From the CFO transition CEO, Zhao Yi not only control the financial indicators also have to control the company's operations. Finance and operations are antithetical, business management has to find the balance point, to do with spending and earning, but sip can only earn, can not spend. It is reported that when the epidemic in 2020, before June, in addition to Wanda Group, all the Party A, including rent, water and electricity, and other full payment, including large reimbursement of employees, Zhao Yi has not been signing, the whole 10 months, the employees did not receive reimbursement. Resulting in the sip and eat with party A, the relationship between the staff is extremely deteriorated. Party A's support for sip feed is also relatively reduced, sip feed now and a lot of shopping malls are not very good relations, coupled with sip feed's brand influence has been weakening, internal scandals continue to be exposed by the media, some shopping malls and even the direct introduction of a series of similar competing brands to do silent protests.
Some data show that shopping centers are losing interest in traditional sip and eat stores.
In 2020, for example, seven commercial projects opened in Zhengzhou, Greenland Sky City, Longyue Xinyuehui, Tianze City, Greenland New Metropolis 360 Plaza, Huimeimao are no sip and eat stores, only Wanda Plaza in the high-tech zone and Wanjia Center City in Dengfeng, the introduction of two stores. Even the Beijing flagship store of in xiabuxiabu is only opened in an inconspicuous corner of the second floor of the ground floor of Hopscotch.
In an interview with the staff and management of Gluttony, the interviewees believe that the group management out of new products, transformation, are in the office patting the head to come up with, are not after market research and analysis, with the set of management is still more than a decade ago, very backward.
"Regarding most of the new products in recent years, including tea drinks, it is a few people nestled in the office patting their heads and thinking that customers may like these things. Gluttony has been taking for granted what customers like, not really doing market research at all, and so far no one understands what the so-called market research actually is. From 2019 onwards, sip feed is pushing tea drinks, and the action is also very high-profile, the company's external are said to be very bright and shiny, but the tea drinks are actually from the internal point of view is a failure, the failure is divided into a few reasons, first of all, the product line is completely divorced from the market demand, sip feed from the beginning of the launch of all the things to today is almost in the high, a few people nestled in the office to shoot the head, completely did not really do the market research, much less A person really understand the method of market research and what is the core. Furthermore, the following people do not convey, do not act, sip feed operation manager can be said to have no idea, no action, but also simply can not understand the strategic deployment of the enterprise, sip feed all executives are looking at the figures, but simply do not understand the meaning of these figures inside and behind. Tea sales are not good, the restaurant will be scolded, the above let the restaurant to Coke and other non-tea drinks all off the line, forcing customers to order tea drinks, the number of not come, it does not matter, the original price of more than 20 yuan of tea drinks sold at 8 yuan. This time, tea sales did increase, but this move brings profits, brand influence and even customer feelings are extremely poor. Why tea drinks will fail? This action is completely without top-level design, the above from the beginning from a professional point of view to inform the operations team of the far-reaching significance of this strategic deployment."
Even sip feed internal ordering layout using the most primitive Excel form, "This is KFC 10 years ago to play the rest, the senior management of all steal KFC, others stalls sip feed also stalls, in order not to learn, the skin are peeled over."
These interviews reflect the problem: sip feed's strategic layout, level of operation, the actual operation, market research and other capabilities, including the company's management team are still stuck in the level of 10 years ago. "Gluttony has a serious bureaucratic culture, the top management does nothing, plus they only speak good words and are only willing to listen to good words, such a company will not voluntarily withdraw from the market, but will ultimately be eliminated by the market."
It was also pointed out that Zhao Yi, who was born as CFO, in order to control profits, took down the star products that customers liked such as Gluttony's main boutique fatty beef and New Zealand beef, without regard to the market reaction and customers' emotions. Coupled with sip feed pot base and other seasoning manufacturers change again and again, the taste is different almost every time the goods, resulting in customers come do not know what to eat. Gluttony executives accused Zhao Yi "of their own profit control ability is low on the rough shelves of customers like star products, such financial control thinking can be described as the cover-up, the cat and mouse to the extreme."
Opened in in xiabuxiabu store tea rice tea
Zhao Yi in the group is accused of "strong" caused by its and sip feed group internal disagreement, which may be consistent with the sip feed side of the "management style and philosophy and other members of the board of directors There are significant differences". According to sources familiar with the matter, put together the brand and sip and eat brand independent operation, put together the brand "a little bit by sip and eat brand suppression, a bit of internal conflict", "put together the main hot pot + tea rest, tea tea originally is put together, sip and eat to take to put their own store, but tea tea to be Independent store, sip feed and not allowed, Zhao Yi is a relatively strong person."
In addition, there are some rumors about Zhao Yi do not know the truth. One of the news that sip feed internal corruption is serious, the marketing department employee Zhang Jun has been reported to the supplier openly asked for as much as 25% of the proportion of the huge kickbacks, Zhao Yi for the report showed an attitude of "do not pay attention to, do not investigate, do not pursue". As of this writing, Young Finance has not received a response from Zhao Yi.
Zhao Yi vs. He Guangqi, the beginning and end of the honeymoon
Early Gluttony
At the same time as the announcement of Zhao Yi's dismissal, the company announced that the Gluttony founder and chairman of the board of directors, He Guangqi (pictured above), took over the position of CEO, to try to stabilize the military! "But the company's shares still fell more than 15% that day, and then fell more than 8% the next day to below HK$9 per share, until the third day to stop the decline.
In 1998, He Guangqi introduced the "one person, one pot" fast hot pot from Taiwan. Initially business is not ideal, after SARS in 2003, due to hygiene and lower unit price, only to quickly occupy the popular hot pot market. According to reports at the time to see, He Guangqi sip feed positioning very sure, he said: "I want to become China's largest fast food brand, all my planning revolves around surpassing KFC, in a city where he 1000 stores I 1001, anyway, I want to be more than he has a store."
In 2019, He Guangqi's goal impressed Yinglian Private Equity, which decided to hold Gluttony for $50 million.When Zhao Yi joined the company in 2012, she found that the management of Gluttony was basically McDonald's and KFC, which reflected Gluttony's original intention of doing McDonald's in the hotpot world.
Zhao Yi and He Guangqi's relationship began in the United States. At that time, Zhao Yi served as McDonald's North Finance Director, the CEO of McDonald's Greater China that the level of this financial has far exceeded the required business capacity. Later, Zhao Yi went to the U.S. to study, when her husband was in the U.S. on official assignment, she wanted to bring up her son while doing what she loved - joining a few McDonald's in the U.S. During her study, she met a few people who had been working for McDonald's for years. During her study period, Zhao Yi met He Guangqi, the chairman of Gluttony, who invited her to be the CFO of Gluttony, and led Gluttony to go public, which ushered in a new inflection point in Zhao Yi's life.
After entering Gluttony, Zhao Yi spent a year to help Gluttony set up a financial system and make a **** enjoyment center. In the second year, in order to make the business of sip feed more standardized, she will be in McDonald's did not achieve the ability to sip feed all the practice of the catering industry to achieve a large volume, must be replicable. Zhao Yi previously managed two of the largest stores in McDonald's, which laid a solid foundation of financial systems, such as inventory management, inventory forecasting, labor management, and so on, for her later in Gluttony.
In 2014, after leading Gluttony to a successful IPO, Zhao Yi once won the trust of He Guangqi, and could even be described as "favoritism", who once publicly praised Zhao Yi as "a genius" in a meeting.
The honeymoon period began to show signs of ending in 2020, and this is evident in the fact that Zhao Yi began to reduce his stake in Gluttony. According to the equity disclosure information, in October 2020, Zhao Yi reduced his holdings of 912,800 shares of Gluttony, cashing out 12,569,300 Hong Kong dollars; in January and April 2021, two times two times to reduce their holdings, cashing out a total of about 30 million Hong Kong dollars.
Lost Gluttony
In 2014, Gluttony was listed on the Hong Kong Stock Exchange, becoming the first domestic listed hot pot brand. Landing on the capital market, Gluttony launched a rapid expansion strategy.
When two dollars a mahjong dipping sauce was replaced by seven dollars a DIY dipping sauce, Gluttony has embarked on a road of no return. This small hot pot in Taiwan, which was once popular among the "invisible poor people in the city" with its "small hot pot for one person to eat", now seems to have forgotten its original intention. 2017, Gluttony will transform itself from a "fast-food" hot pot to a "fast-food" hot pot, and then to a "fast-food" hot pot. "Hotpot" to "light meals", per capita unit price from 30-40 yuan to 60-100 yuan. Gluttony dishes price increases, shelving star products. Some customers on social media complained that the fat beef set meal at Gluttony had slowly risen from 46 yuan to 56 yuan. And not long after the price hike, the fatty beef set meal completely disappeared from the menu and was replaced by a $65 Australian small set meal. The customer said "Although the food is more refined, I don't need it, I'll just eat regular fatty beef."
Looking back at the history can be found in 2016, sip feed is not willing to do fast food, to take the road of light meals, announced the official launch of the "sip feed + brand upgrading program" - subversion of the fast food model, turn to do the upgrade of the leisure experience. At that time, some people ate 100 yuan per capita after eating sip feed, said "I add 50 dollars to eat a meal under the sea it does not smell?" Since then, sip feed dine-in performance decline, but good luck in 2018 when the rise of takeaway, cover dine-in downward trend. "And inexperienced company executives only know how to look at the overall data and did not pay attention to the decline of dine-in."
Zhao Yi came on as executive president in 2018, when Gluttony was already struggling. At one time, with the expansion of scale, the business advantages of sip and eat bar-style began to manifest: bar-style dining layout can increase the customer capacity of the store, the same store area than the traditional hot pot restaurant increased by more than 30%. But with the upgrade, this advantage has disappeared.
In 2019, Zhao Yi led Gluttony to try to make up the difference in the decline of dine-in through new business, hoping to get more traffic, and the tea store business is to make up for the continued decline in business deficit. Although the tea drinks will bring the entire restaurant into the "light meals", but in reality, whether from the service process or the entire QSC (created by McDonald's fast-food concept of three letters respectively represent the quality, service, cleanliness system), sipao's entire original system still does not have any improvement or change, which can be seen in the existing training system in sipao no sense of existence, not to mention the existence of a large number of people. The first is that there is no sense of existence, not to mention the significance of the existence of a large number of people.
Originally, the bright orange color, the bright music, and the U-shaped bar that compresses privacy were all elements that urged diners to eat faster, thus increasing the turnover rate. Now, with the change in color from orange to rustic, more private dining space, and a hand-rolled tea, the restaurant has changed its tone from a fast-food outlet to a full-fledged restaurant with a sense of humor.
The flagship store of sip and eat in xiabuxiabu in a hidden corner on the 2nd floor of the ground floor of Hopscotch in Chaoyang, China, was analyzed by investors in the catering industry as having one thing in particular that was good about sip and eat in the early years: "it has no rivals". According to an earlier report in VentureBeat magazine, hot pot peers are reluctant to evaluate the sip and feed because: sip and feed can not be completely considered hot pot, its identity is more like fast food.
Clean, fast, convenient, inexpensive, is the reason why consumers choose to sip feed, which happens to be the same as a few years ago, people choose KFC, McDonald's reasons. But sip feed from no rivals to rivals all over the world.
Gluttony seems to have lost its market position as a restaurant brand in the game of numbers after going public, and is running blindfolded in the game of revenue and profit.
In order to salvage the decline, Gluttony accelerated the speed of opening stores and increase the per capita unit price. The logic is that as long as the speed of opening stores fast enough and per capita continue to go up, then, the decline in turnover rate can still bring growth in gross sales. But that's it, in 2019, which is a quality year for the development of the catering industry, compared to Haidilao's same-store sales growth rate in third-tier and lower cities during the same period was still positive at 8.3%, as the first stock of hot pot sip and eat group had a negative growth rate of 37.7%.
The upgraded and remodeled Gluttony is a pouncing Chinese Zen style in store design. The store has reduced the U-shaped bar and replaced it with party tables for 1-4 people, with a significantly lower seating density. The turnover rate continues to decline, with 3.3, 2.8, 2.6 and 2.3 for 2017-2020.
Negative same-store sales growth is a derivative of the decline in turnover, and since 2014, Gluttony's turnover rate has never had positive growth, with its year-on-year decline from 3.5 to 1.8. Earlier lower same-store sales can be masked by pulling up per capita
In this way, sip feed is trapped in a vicious circle of difficult to solve store opening: more and more stores, as of the end of 2020 has more than 1,200; but operational efficiency can not keep up with the turnover rate and other key indicators have declined over the years, the company's profitability continues to decline; want to grow, it is only to continue to open the store. But from the sip and eat the number of store expansion in the last four years, each year the difference between the expansion of the store is getting smaller and smaller, the expansion of the speed of the store has been significantly reduced. 2017-2020, the number of its stores were 759, 937, 1,022, 1,061.
Guoyuan International downgraded its rating on Gluttony to "hold", and said in a related report, 2021 is expected to open 70 new stores, and so far only 4 stores have been opened. Gluttony brand expansion is also expected to slow down. In addition, in the short term, gluttony appeared major personnel changes, the business outlook is more uncertain.
Upgraded Gluttony. There has been a customer online review said to the key place, "sip feed, put together the upgrading is only reflected in the decoration and customer unit price, for the product experience and brand power did not have customers favor the action". As of September 2019, Gluttony has 955 restaurants in China, 700 of which have been upgraded to version 2.0.
According to the financial report, Gluttony's year-on-year net profit growth from 2016 to 2020 is 39.74%, 14.17%, 10.07%, -37.71% and -99.36%, respectively.
Gluttony made its fortune earlier on value for money, but in recent years it has torn off the value for money label that once held itself up to the top.
Zhang Zhenwei's departure has a direct impact on the capital market's view of Gluttony. As early as Zhang Zhenwei left before, sip feed shareholders high altitude capital and JP Morgan staged a capital flight, the two institutions from March 15 this year, began to sip feed to liquidate the reduction of holdings.
On June 28, the director of China CFO Development Center sent a microblog to Ms. Zhao Yi: "Zhao you are not alone in the fight. China CFO Development Center, as the CFO's mother's family, behind a large number of listed companies CFO is your brothers and sisters. Mr. Zhao, is for the standardization of China's food and beverage industry has made outstanding contributions to the management, is for China's food and beverage enterprises to write a successful chapter in the management of change, is China's corporate CFO transformation to do the best of their ability to do the model."
Zhao Yi responded, "Mr. Guo, special thanks for the support. From CFO later to CEO conversion, in fact, not only business promotion, the middle also includes compliance. Including us as CEO, to ensure that the interests of all shareholders, after all, and the major shareholders of certain practices conflict, which may be in the career advancement inevitably have to face, or compromise, may be or is like me this. It may be necessary to sacrifice CFOs like us to advance the whole enterprise to really become a public company. In fact, we also promote the whole private enterprise, to the formal way. I would like to especially thank my mother's family for their support and help, thank you."
On June 30, Young Finance called the public relations department of Gluttony, and the phone prompted an empty number; the phone of the investment relations department was not answered. The latest news is stuck in April 2020, and the rest of the columns on the official website of Gluttony have stopped being updated, except for the investor relations section.