By Lv Mingman

Out of DailyFinance

The aftershocks of the management shakeup at Gluttony (0520.HK) are still unfolding, as a 3,000-word letter from Zhao Yi went viral on June 28, claiming that she had been removed by the board of directors from her post on May 20 without any prior notice. The article is a refutation of the accusation that some of the sub-brands of Gluttony did not meet the expectations of the board of directors.

And at the time of the incident, she said she was on a high-speed train and had to run to the bathroom and "squat" with her laptop for nearly an hour because there was no room for a teleconference. Unsurprisingly, this is probably the most "flavorful" presidential dismissal ever.

The incident, sip feed shares plummeted, in addition to the impact of high-level personnel turmoil, must also be its past performance and the future of the major uncertainty is not unrelated. And a series of problems and contradictions entangled in the sip feed the beginning of the explicit, also can not help but let the outside world sigh: once the pioneer of small hot pot sip feed why more and more do not adapt to the market changes.

The story will always come to an end, the capital will eventually retreat

Why the sudden dismissal of the president?

According to public information, in 2012, Zhao Yi joined Gluttony as a professional manager in charge of finance-related matters as CFO. Prior to that, she had held executive positions at Unilever, Sony Ericsson, and McDonald's. Under her leadership, Gluttony was successfully listed on the Hong Kong Stock Exchange in 2014.

It is fair to say that Zhao Yi deserves a great deal of credit for the growth of Gluttony from a private company to the public-facing conglomerate that it is today. This point, the founder of Gluttony, He Guangqi also personally recognized, not only praised her as a "genius", but also in 2019, the public opinion, pushed her into the position of chief executive officer.

If the story ends here, it would be a great story in the business world.

But today, Zhao Yi is no longer allowed to be involved in Gluttony's corporate management. Following the May 21 expectations did not meet the standard dismissal of the chief executive officer of the post, June 14, sip feed again announced the announcement of the removal of its executive director of the "motion", the reason is that Zhao Yi's management style and philosophy of the other members of the board of directors there is a significant difference between the founder of the He Guangqi at the same time to take over his duties.

Obviously, such a sudden dismissal of executives reflects the company's internal conflicts may have been further intensified. The reason why I say "further" is because the drama of executives leaving the company and the stock price plummeting has been staged more than once at Gluttony.

On April 16 this year, Gluttony announced that Zhang Zhenwei resigned from the post of CEO of Minjian, while resigning from all positions in the company. After Zhang Zhenwei left, the ministry of each department and the regional head will report directly to the He Guangqi. April 19, that is, after Zhang Zhenwei left the first trading day, sip feed shares plummeted, down once more than 20%, the lowest share price of 11.26 Hong Kong dollars, a record low in nearly half a year, the company's market value evaporated directly to 2.1 billion Hong Kong dollars.

Accompanied by a drop in share price, high-level walk, now the sip feed quite a "tree toppling monkeys scattering ships" meaning. Not only that, in March of this year, high waterfront capital will its two funds held nearly 114 million shares of sip feed shares all liquidated. At the same time, Damo will also hold 104 million shares, reduced to 0.12 billion shares, the shareholding ratio from 9.25% to 0.93%.

Performance shows all the fatigue new products are difficult to pick the beam

Gluttony today's dismal, not only can be proved in recent years of decline, but also will certainly y affect the future.

"Daily Finance Report" learned that the sip of food in recent years, the financial data is dismal, and the epidemic later did not significantly improve. The financial report shows that from 2018 onwards, Gluttony has begun to go downhill, profits have declined for three consecutive years, and in 2020, Gluttony's performance was seriously affected by the epidemic, with revenues of 5.455 billion yuan, a year-on-year decrease of 9.5%; the net profit was only 18.37 million yuan, a year-on-year decrease of 99.4%, and it is not far from a loss.

It is also worth noting that the growth rate of net profit of Gluttony has been on a downward trend for five consecutive years. 2016-2020, the growth rate of net profit of Gluttony was 39.74%, 14.17%, 10.07%, -37.71%, and -99.36% respectively.

(Chart: Daily Finance)

The worst thing is that because of the blind expansion after the listing, as well as misjudging the situation for consumer upgrading, the price point is getting higher and higher sip and eat, the word of mouth is rapidly declining, and the customer attendance rate is getting lower and lower.

Generally speaking, the turnover rate is one of the most important indicators for any restaurant to examine the operation of the restaurant. A high turnover rate means that you can make the seat flow rate increase in a limited space and limited business hours, and the revenue will increase exponentially, and vice versa. The data shows that its turnover rate is 3.3, 2.8, 2.6 and 2.3 from 2017-2020, which is also a gradual decline.

"Refutation" is superficial, "action" is honest. We found that, probably Zhao Yi also long held a pessimistic attitude towards Gluttony, which in January and April this year, twice reduced their hands of shares, the cumulative cash amounted to more than 30 million Hong Kong dollars. "The route close to, create a brand "together", to be in the brand image, product structure, store environment, service mode and other aspects of the adjustment. But with money to create a "sense of sophistication", inevitably reacted to the unit price. In fact, now 126.6 yuan of customer unit price, has exceeded the seabed fish 110.01 yuan of customer unit price. There are even netizens who say, "I'd rather eat at the bottom of the sea with this kind of money, at least the service is good."

fierce market competition, the old will be difficult to have a new "party"

According to the "2020-2021 China hot pot industry development report" is expected in 2020, China's hot pot market revenue will reach 888 billion yuan. As a category with a high degree of standardization, a mature industry and an overall pattern that is still relatively decentralized, hot pot has become the first choice of many catering entrepreneurs.

But data from the Prospective Industry Research Institute shows that the concentration of the industry is not high, and the market share of Haidilao, which has the highest market share in 2019, is only 2.2%, and Gluttony has less than 1%, and the top five only account for 5.5% of the hot pot market.

Now, the founder of the He Guangqi re-emerged, but faced with a different market landscape, the current hot pot jianghu can be described as "masters of the forest", each with its own special hot pot store, the net red store endless.

Several popular hot pot brands, almost all rely on the "hot pot + special single product" model to capture their own loyal customers. For example, the main duck blood hot pot "Tan Duck Blood"; unique marinated hot pot "Xianhezhuang"; to tripe famous "Barnu", these brands played their own differentiated operation, in the hot pot circuit. The hot pot track has stabilized its footing.

In addition, the "home to eat hot pot" mode of consumption has emerged. Aiming at the home hot pot pot pot circle food sink, lazy bear hot pot, meal explosion ingredients and other brands, has also obtained ten million level of financing. Even in the box horse, daily fresh, Dingdong buy food and other new fresh food e-commerce, relying on their own supply chain, logistics advantages, but also in the delivery of hot pot to the home of the service.

Even though the hot pot industry market is huge, but facing so many background competitors, gluttony is hardly easy. Right now, two of its executives left in quick succession, sip feed need to be able to let it get rid of the lack of growth of the helm of the plight of the founder of the He Guangqi after nine years and then personally may also be a choice of helplessness.