Chain Restaurants, Old and New, Flock to County Towns Looking to Make Easy Money(AI Translation)
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- In early March 2024, Haidilao (06862.HK) announced it would start franchising after previously operating over 1300 self-owned stores in Greater China. Another leading restaurant company, Jiumaojiu (09922.HK), also opened two of its brands for franchise a month earlier, signaling a trend among top dining chains to embrace franchising to penetrate lower-tier markets.
- The rapid expansion of new fast-food, milk tea, and coffee chain brands into lower-tier cities has aligned the dining market in these areas with that of first-tier cities. Franchising is seen as a strategic move to tap into the 'sinking market,' which refers to counties, towns, villages, and third to fifth-tier cities across the country.
- Despite the popularity of franchising in China's dining sector in 2023, with notable brands like Xicha opening 2390 stores in one year through franchising compared to just a few hundred previously, success varies. Many franchisees stress the importance of thorough brand and location research before investing due to the mixed profitability and high competition within the industry.
文｜财新周刊 冯奕铭
By Caixin Weekly's Feng Yiming
下沉市场的餐饮加盟热潮，终于让餐饮连锁龙头海底捞也坐不住了。2024年3月初，海底捞（06862.HK）宣布开放加盟，而此前，其大中华区超过1300家门店全部自营。
The surge in franchising within the catering market in lower-tier cities has finally prompted action from the leading restaurant chain, Haidilao. In early March 2024, Haidilao (06862.HK) announced it would open up for franchise opportunities, whereas previously, its more than 1,300 stores across Greater China were all self-operated.
另一家旗下五个连锁品牌原本都自营的餐饮头部企业九毛九（09922.HK），已在一个月前宣布开放太二酸菜鱼和山的山外面酸汤火锅两个品牌加盟。截至2023年上半年，太二酸菜鱼共有496家门店，而山的山外面至今仅有2家门店。
Another leading catering company, Jiumaojiu (09922.HK), which originally operated five chain brands independently, announced a month ago that it would open up its Tai Er Sour Fish and Shan De Shan Wai Mian Hot Pot brands for franchising. As of the first half of 2023, Tai Er Sour Fish has a total of 496 stores, while Shan De Shan Wai Mian currently has only 2 stores.
加盟又称特许经营模式，品牌商授权加盟商使用自身品牌、产品、设备等。而海底捞和九毛九开放加盟，都是为了跟进此轮餐饮品牌奔赴下沉市场的潮流。近三年，新兴的快餐、奶茶和咖啡等细分餐饮品牌以连锁方式快速扩张，推动下沉市场餐饮业态迅速与一线城市对齐。而所谓“下沉市场”，一般指全国地级市以下的县、镇和乡村地区，以及三至五线城市。
Franchising, also known as the franchise business model, involves a brand owner authorizing franchisees to use its brand, products, equipment, etc. Haidilao and Jiumaojiu opening up for franchising are moves to keep pace with the trend of dining brands venturing into lower-tier markets. In the past three years, emerging fast food, milk tea, and coffee segment brands have rapidly expanded through chains, propelling the dining scene in lower-tier markets to quickly align with that of first-tier cities. The so-called "lower-tier markets" generally refer to areas below the prefecture level nationwide, including counties, towns and villages, as well as third to fifth-tier cities.
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