Hot pot chain Haidilao’s first fiscal report after its IPO is out, and the result aren’t bad, particularly considering the company’s rapid expansion globally and sizable spending on human capital.
The adding of 200 new restaurants, boosting Haidilao’s worldwide total to 466, helped push the company’s revenue up 59.5% year-on-year to 16.97 billion yuan ($2.52 billion) for the year ended Dec. 31, 2018. Net profit attributable to owners of the company surged 60.1% to 1.65 billion yuan.
Known for its attentive customer service and unique employee-encouragement strategies, staff costs of the hot pot chain climbed 60.8% from 3.12 billion yuan to 5.02 billion yuan in 2018, 29.6% of total revenue. Apart from hiring for new restaurants, Haidilao also attributed the cost surge to “increase in compensation levels” of staff, who are encouraged to participate in training and personnel-improvement programs.
When a diner queues at an often-packed Haidilao, staff may provide free nail polish or a hand massage, to help kill time and improve customer experience. If you dine alone at Haidilao, staff may put a fluffy doll beside you as your companion, following the company’s services guidance.
Haidilao has also adopted a special “apprentice mechanism” which allows restaurant branch heads to train their own apprentices, and receive bonuses if their trainee is promoted to head of a branch. The mechanism aims to motivate staff and improve operation quality in new restaurants.