First, the endogenous growth of Haidilao

When it comes to Haidilao, as long as it is the people of the earth should be aware of it, and if you don't know it, you come, and I'll treat you to it.

On September 26, 2018, Haidilao landed on the Hong Kong Stock Exchange, and its market value broke through 100 billion Hong Kong dollars, becoming the world's fifth largest catering company, and its market value is 9 times that of the first hot pot restaurant listed in Hong Kong - sip and eat, and the static price-earnings ratio has reached more than 60 times. The stories and legends about Haijilao have been circulated in various versions in the jungle.

Starting from the spicy hot pot store in 1994, Haidilao has conquered the market in major cities across the country a little bit from the third-tier city of Jianyang in Sichuan, to the second-tier city of Xi'an, and then to the capital city of Beijing. In the fifteen years since the start of the business, Haidilao has grown to 50 directly-managed restaurants, as well as four logistics centers and a production base.

For hot pot catering, Zhang Yong has long asserted that taste is not the most important competitive factor. Cooking level on the hot pot catering impact is very small, the guests and with their own seasoning, the preparation of ingredients is relatively simple, therefore, the key point of competition is the quality of ingredients and service level.

Many experts and scholars have analyzed the service of Haidilao and written books for it, the conclusion and evidence are roughly three aspects: first, Zhang Yong highly empowered employees, for example, the waiter has the right to free orders, which is very rare in other restaurants; second, the company gives dignity to the staff to provide superior treatment and can look forward to the career development path; third, the Haidilao stores only two assessments --Customer satisfaction and staff efforts, financial indicators are never in the Haidilao assessment system.

These are indeed important driving factors for the development of Haidilao, but cannot explain how Haidilao as an organization stands rather than a scattered existence.

When Haidilao grew to 50 restaurants, Zhang Yong realized that the more laissez-faire management style of the past was struggling to cope with the scale of the operation of more than 50 stores, and the company began to improve a variety of administrative functions and try to recruit higher-end talent to join the management team.

The level of internal promotion of talent and the ideal quality of talent gap, external parachute and bring the incompatibility and internal contradiction, the growth of talent paradox Haidilao natural can not be spared. Haidilao talent development is the root of internal promotion. With the growth of the company's scale, Haidilao formed a pyramid-style management structure, the excellent store manager can be promoted to the district manager, and then to the regional manager, along the management level of the company's ladder upward development.

With this, two questions arise: the excellent store manager must be able to be a good good middle? If the store manager are "official" as the goal, where to find new store manager? In Haijilao system, in addition to promotion, store managers have no more outlets. Zhang Yong said to the media in 2011, "the reputation in fact difficult to substandard, this is the status quo of Haidilao", "I own which toe headache, I know ......"

The second part of the "Haidilao" is the "Haidilao", which is the "Haidilao". p>

Second, Haidilao little-known three major issues

Haidilao little-known issues are three:

1. People's problems - the first to ensure that the store manager training speed;

2. Whether the organizational growth model supports rapid expansion;

3. The issue of cultural heritage - behind the quality of service is about dignity, fairness, income, empowerment and soft assessment and so on countless factors, how to retain the advantages of the past in an organization to grow up?

In fact, as Haijilao grows from an organic organization to a mechanical organization, the dehumanizing things such as establishing rules and regulations have always been in conflict and competition with the humanizing things such as authorization and passion, and the question is how to not lose oneself in the growth?

Zhang Yong's answer is "connect the interests, lock the management", which appeared in the global prospectus of Haidilao.

Adam Smith, in The Wealth of Nations, suggests that every man tries to make good use of his capital and maximize its value. Generally speaking, he does not attempt to promote the public **** welfare, nor does he know how much public **** welfare is actually promoted. What he seeks is merely personal gain.

However, the pursuit of personal gain leads him to put his capital to the most socially beneficial use. ...... He is guided by an invisible hand, and tries to achieve a purpose that he did not intend to achieve. This is the best interpretation of Zhang Yong's "connecting interests". As for the "lock management", it reflects the ability of a large platform organization should be, in the direction of the organization wants to set the rules of the game, the implementation of the assessment, inspection and correction of errors.

Third, crack the "master and apprentice" of the problem

In the cultivation of new store managers, the most vocal person is the old store manager, but "teach the apprentice, starve the master" dilemma of the essence of the problem is to solve the issue of --How to incentivize the old store manager to teach the new store manager? Moreover, this mentor-apprentice relationship should never be a one-shot deal, and may have to provide follow-up support, including after taking office.

In the restaurant industry, it is possible that problems that don't happen once every few years (e.g., fire, food safety, a guest slipping and falling in the store, etc.) can overwhelm an inexperienced store manager, or even create a public opinion crisis that can tarnish the value of the entire brand. It is important to incentivize veteran store managers to change their mindset from self-interested to altruistic, so that the entire hierarchy of store managers can be upgraded as a whole, and to this end, Zhang Yong has set up an "altruistic" profit-sharing mechanism.

A-level store managers are qualified to be masters, masters choose their own apprentices, the company does not interfere with the candidate, but the "family" number of limitations for 5 to 12 people, and the coaching team will set up qualification exams on the apprentice to certify that those who are qualified to become a reserve store manager.

The master's salary is divided into basic salary and variable salary, variable salary belongs to the category of profit sharing, the store manager can choose the higher of the following two options: 2.8% of the profit of their own restaurant, or calculated in accordance with the following formula: 0.4% of the profit of their own restaurant + apprentice restaurant profit of 3.1% + grandson restaurant profit of 1.5%.

The company puts up 5% of the profit as an overall bonus pool to incentivize the store manager tier. The master gets 0.4% of his own store's profit (based on a mature store that makes $1 million a month, the store manager's variable monthly income in this area is only $4,000). Although this part of the variable salary incentive amount is not large, but set this part of the incentive for the company is very significant - although the company does not assess the store manager financial indicators, but the store manager at least has the obligation to ensure that their own store financial operations healthy.

In terms of incentivizing the master's "coaching behavior" (to take the apprentice), 3.1% of the apprentice's store profit is automatically counted as the master's variable salary. If an apprentice takes on another apprentice, 3.1% of the apprentice's grandchildren's store profit is automatically credited to his or her own master's variable pay, and 1.5% is automatically credited to his or her own master's variable pay. In this way, it is possible for a master to earn a far greater variable wage from the store where his apprentice's children and grandchildren are located than from his own basic salary. In Haidilao, there have been dozens of store managers with several million dollars in annual salary, comparable to executives of Chinese listed companies.

"Altruistic" incentives to encourage the old store manager to train apprentices, to today's Haidilao 2017 more than 100 self-owned new store opening speed, although breathtaking: Haidilao the power to expand the store completely to the store, the huge Department of Development disappeared, the Department of Development of the risk of corruption is also reduced to a minimum, the headquarter is used to retain only a small development team. Only a small development team is retained to coordinate special cases and implement certain store expansion initiatives that reflect the company's strategy.

The headquarters arranged a mystery shopper assessment of customer satisfaction and staff efforts two indicators, as long as the store to reach the A-level store is eligible to propose the opening of a new store, the new store manager appointed by the old store manager, the headquarters will generally support.

But the speed of Haidilao to open new stores is not as fast as the speed of the store manager training.

With the mechanism of extracting profits from the apprentice's store, the old store manager (master) is much more motivated, not only to teach the apprentice, but also willing to help the apprentice with experience to find a good location to open the store, and after the store is opened to help the apprentice store to improve the rating (off the C) and the training of waiters. The rating of the apprentice store does not affect the rating of the master's store, but only if the apprentice's store also achieves an A rating will it be eligible to develop apprenticeships, allowing the apprentice to increase their personal income on their own (3.1% of the apprentice store's profit), and then allowing the master to further increase their personal income (1.5% of the apprentice's store's profit).

The profitability of the apprentice store has the greatest impact on the personal income of the master, and a smaller impact on the apprentice himself. The company does not assess store profitability targets, but the apprentice must ensure that his or her store's profitability is at a healthy level, or else it will be difficult to retain staff, let alone customer satisfaction and staff effort. Employees tend to automatically start applying for mobility between Haiyan stores.

The store manager's family operates as a group, adopting a consultative mechanism that drastically reduces the need for support from corporate headquarters functions.

Zhang Yong is not worried about nepotism at all, a clear mechanism of master and apprentice interests so that the old store manager can never just find a relative to fill the position of the new store manager, because the apprentice store is the old store manager's main source of income, the wrong person will have a direct impact on their own personal interests.

Fourth, piecework wages and dry system

Most of the catering industry waiter's salary in three or four thousand, the average salary of the waiter under the sea is high and pulled the difference. The best waiter can get 13,000 or 14,000 yuan per month. In the past, Haidilao stipulated that a waiter to see three tables, fixed salary accounted for the vast majority.

After taking the piece-rate system, three waiters to see 10 tables, although the average workload has not increased significantly, but they *** with the contracted 10 tables, the enthusiasm is very different. The lead waiter is called "small customer service", the remaining two are "big apprentice" and "second apprentice". For the entire group, each dish served to a customer earns a variable wage on a piece-rate basis, and Little Customer Service has the authority to distribute this variable wage. He can give two apprentices a fixed salary, and the rest of the floating wage is his own.

And because of the piece-rate wage model, Haidilao waiters are most concerned about the location of the store, turnover rate and the level of leadership of the store manager, to ensure that the level of opening a new store.

Fifth, do the world's hot pot

As of May 2018, Haidilao opened 19 stores overseas***, mainly in Southeast Asia.

Overseas store opening itself is not difficult, the difficulty still lies in finding the right store manager and waiter, and the more difficult thing is to move this set of domestic incentive programs to overseas. The first generation of overseas store managers are sent from China, the second generation of store managers are often trained locally. Although overseas store opening is also speeding up (40 overseas stores are planned to open in 2018, of which 12 are in North America), Zhang Yong believes that overseas stores still do not capture the local mainstream customer base, and the speed of store opening is not comparable to the domestic.

And, he has been intended to enter the North American market has not really broken the game - only four stores in North America in business, and less profitable than the stores in Southeast Asia. Zhang Yong believes that "to become a mainstream brand in the United States, we must let the Americans to eat." So, overseas market expansion mechanism and store manager training mechanism in the end can be used in the domestic model? American mainstream society can really accept spicy Chinese hot pot?

Some people ask, Haidilao's overseas development strategy is what kind of? Zhang Yong's answer is very simple: "How many store managers we have, how much we plan to do." The match between people and organizations is a service enterprise even if the development of overseas will never be able to get around the subject.

First, the store manager partnership of Hundred Fruit Garden

At present, Hundred Fruit Garden has more than 2,800 online and offline integrated stores, with sales of nearly 6 billion yuan in 2017, and the market share is the first in the industry in fruit retailing, and it has acquired the Beijing Fruit Dome and the Chongqing Chaoqi Fruit fruit chain brand. Hundred fruit garden development can be divided into four stages:

The first stage is the establishment of the company in 2001 to 2008, is the stage of groping, Hundred fruit garden engaged in the franchise model, continuous loss of seven years, stumbled to 100 stores;

The second stage is from 2008 to 2015, buy back all the franchise stores, transformed into a fully independent self-owned stores, 2015 In 2015, it opened to 1,000 stores;

The third stage is from 2016, after obtaining the A round of financing, due to the intervention of the capital market began to expand greatly, and the total number of stores exceeded 2,800;

The fourth stage is from 2018, after obtaining 1.5 billion yuan of the B round of financing, it restarted social franchising, and further accelerated the speed of expansion.

Hundred fruit garden late rapid development, although there is the help of capital, but not just money, you can put a store to open up quickly, Hundred fruit garden in the chain of operation and incentive model of innovation can not be ignored.

Hundred Fruit Garden early also used the franchise model, after more and more franchisees, high maintenance costs, franchise fees, supply chain instability, resulting in a continuous loss of seven years of misery. Hundred fruit garden in the original franchise model on the basis of a systematic summary, the choice of "class direct" business model, that is, let the store manager to become the main body of the investment, the actual equivalent of the store manager partner system.

Second, Hundred Fruit Garden store manager partnership

1, store equity structure

Participate in store investment in three parties: the company's area managers, regional franchisees and store managers. Store equity structure and division of labor is as follows:

Individual store participants Single store capital investment Undertake the work

Area franchisee 3% store location, store legal person

Area managers 17% Area store management

Store manager 80% store operations

Yearly profit distribution, Parkview Park charged 30%, the remaining 70% according to the store The remaining 70% is distributed according to the store's shareholding structure.

2, store manager training program

Hundred Fruit Garden store assessment requirements, the requirements of each store a year for the company's output of a new store manager (partner) candidates. Generally speaking, the training cycle to become a store manager is 8 months to 1 year, and the company will look at the actual situation to see if the new store manager trained by the store meets the requirements, and then decide whether it can invest in the management of new stores.

3, subsidize store losses

Hundred Fruit Park store manager partner system is the most attractive point is that the store if the loss, borne by the Hundred Fruit Park. Specific policies are as follows:

(1) Hundred Fruit Garden does not charge a franchise fee, earnings from the store's annual profit of 30% of the share;

(2) does not rely on the commodity price difference earnings, Hundred Fruit Garden from the store's share of profits accounted for Hundred Fruit Garden's total profit of about 80%;

(3) set up a dividend base, 6,400 dividend base profit, the base profit based on store Operation of a one-year assessment;

(4) Franchise if the loss, the loss amount borne by the Park fruit garden, 3 years later if the loss is still, then assess whether to close the store.

4, store equity exit mechanism

Hundred Fruit Park store manager partner system, store manager equity is dynamic change, that is, can enter, can also be withdrawn, according to the store's operating value, the store manager equity exit, the store manager early to invest in the funds according to the original number of return, while a one-time dividends can be obtained from the store earnings of three times the compensation. For example, the store manager from a store to get the annual dividend income is 100,000 yuan, to let him give up the store's shares, to develop new markets, Park fruit garden one-time compensation to him 300,000 yuan, the equivalent of the store's income for the next three years, while the early investment in the original number of funds back.

Third, the discussion and reference

1, the store manager to participate in the store investment is innovative

From the perspective of the employees, the store manager partner system, actually become a store investor, enjoy the operating income. From the point of view of Parkview, not only can solve the problem of capital investment in the store, but also through employee management to achieve top-down consistency of operations, but also to stimulate employee efficiency, reduce store operating costs.

At the same time, each store cultivates 1 new store manager each year, which solves the problem of the company's difficulty in rapidly cultivating new store managers and lays the foundation for the rapid development of new stores.

2, loss subsidy policy is a guarantee

Hundred Fruit Garden loss subsidy policy is very attractive to the parties involved in the store, do not need to worry about business risks, loss subsidy policy can stimulate the store investment parties to "input", which gives the Hundred Fruit Garden's "class of direct operation "The model has a good replicability.

3, the equity exit mechanism is a gas pedal

As a result of the partner model, so that the franchisee employees, employees franchisee, the need to support the store equity exit mechanism in order to make the model "rolling" up.

Store managers, employees need to rise, promotion channel. Strong ability, more retail experience of the store manager, the need to play more of his value, let him open up new markets, take on more "challenges". However, these capable store managers in the original store can get a good income, are usually reluctant to give up the shares of the original store to the new store manager. Therefore, from the system design, to encourage the ability of the store manager courage to "challenge".

The "exit mechanism" is actually equivalent to the store expansion "gas pedal", so that the more outstanding employees to charge the market front, enhance the success rate of store expansion.

Drucker said that the essence of management is to stimulate the goodwill of each person. After stimulating goodwill potential will be released, Haijilao and Baiguoyuan stimulate the store manager and even ordinary employees, so that they from the physical workers into knowledge workers, to the development of the organization to bring vigorous vitality.