On February 9, in response to the media report on the layoff of Xi tea, Xi tea responded to the Red Star capital bureau that the relevant rumors of are false information. There is no so-called large layoff in the company. A small number of personnel were adjusted to normal personnel adjustment and Optimization Based on year-end assessment before the year.
The previous day, Naixue's tea (02150. HK) issued a profit warning. It is estimated that by December 31, 2021, the group will achieve a revenue of about 4.28 billion yuan - 4.32 billion yuan, with a year-on-year pre increase of more than 40%, and an adjusted net loss of about 135 million yuan - 165 million yuan. This is Naixue's fourth year of loss.
Red Star capital Bureau noted that in the past year, the new tea has experienced a series of events such as financing, listing and price reduction, and has been plagued by problems such as internal management and food safety for many times, and the new tea market has also ushered in a major outbreak in this year.
According to the data, in 2021, the scale of new tea and beverage stores has reached 378000, accounting for 65.5% of the total scale of existing beverage stores; The number of industry financing events and the disclosed financing amount have been higher than the whole year of 2020, reaching the peak in recent 10 years.
What happened to the new tea brand due to the rising cost, serious involution and superposition of the impact of the epidemic
implement layoffs and postpone the year-end bonus?
Xicha response: relevant rumors are false information
On February 9, some media reported that Xicha was implementing layoffs, involving 30% of employees. Some departments were completely laid off, and the laid-off employees would receive normal n + 1 compensation. Some employees said that all employees had no year-end bonus, while others said that "deferred payment".
According to the report, employees have different opinions on the reasons for this round of layoffs. A common view is that Xicha has poor performance in recent years. Although it makes money, its net profit has negative growth, "it may be forced to prepare for listing under the pressure of financial report. Streamlining human resources can make the financial report look better".
Subsequently, Xicha responded to the Red Star capital bureau that the relevant rumors were false information. There was no so-called major layoffs in the company. A small number of personnel were adjusted and optimized based on the year-end assessment before the year. At the same time, the year-end bonus of employees has been normally distributed to employees before the Spring Festival according to their performance.
In addition, some media reported that at the company's annual meeting, Nie Yunchen, founder of Xicha, publicly commented on the disadvantages of friends and merchants, which was regarded by employees as "lack of pattern".
It is worth noting that Nie Yunchen's last out of the circle event was to give up the acquisition of Lele tea.
In July 2021, it was reported that both Yuanqi forest and Xi tea wanted to acquire Lele tea, a new tea brand. Both sides attached great importance to the channel value of Lele tea and gave a valuation of 4 billion yuan. Nie Yunchen responded in the circle of friends: "the news is not true. After being introduced by the middleman, he did have contact for some time, but he has completely, completely and resolutely given up after deeply understanding the internal situation, business data and situation."
Then the response was posted on the microblog hot search. Since then, Lele tea responded that the company insisted on independent development and had no acquisition plan. In addition, the brand is in good operating condition. Both at the single store level and the overall situation of the company are in a state of health, profitability and development.
in the past year, Xi tea and Naixue's tea (02150. HK) have reduced prices one after another, and food safety problems have been frequently exposed. Naixue's tea broke the market, but Xi tea has repeatedly spread the news of listing, but it has not seen the true chapter.
What happened to the new tea brand
holding huge financing
the growth rate of stores fell to a three-year low
2021 is a capital year for new tea drinks.
In July 2021, Xicha announced the completion of round D financing of US $500 million. The management has a grand lineup, including black ant, Tencent, Sequoia, Temasek, l catterton, etc. In this round of financing, Xicha was valued at an unprecedented 60 billion yuan
Xi tea financing history
Naixue's tea was officially listed on the Hong Kong Stock Exchange on June 30 two weeks before Xi tea obtained a large amount of financing, becoming the "first share of new tea".
However, the follow-up business development of the two is not as smooth as expected.
According to the 2021 inspiration tea drinking report released by Xi tea, the number of global stores officially disclosed by Xi tea in 2021 is still 800 +, of which 200 + go stores are expected, while Xi Xiaocha is not mentioned. In contrast, in 2019 and 2020, the total number of happy tea stores was 390 and 695 respectively.
In other words, after obtaining huge financing, Xi tea did not take a big step in store expansion and maintained a restrained rhythm. In 2021, its net increase in stores was less than 200, and the growth rate of stores was less than 30%, which was the lowest growth rate of Xi tea in recent years.
The business district manager of a provincial capital city in Northwest China told the Red Star capital bureau that a good port had been reserved for Xi tea last year, but there was no store in the end, "it is said to be for the reason of listing."
In addition to the slowdown of store growth, the floor efficiency and average store income of Xi tea across the country also began to decline. According to the data of Jiuqian consulting, taking the data of October 2021 as an example, the average revenue and sales floor efficiency of Xi tea shop decreased by 19% and 18% month on month compared with July; Compared with the same period in 2020 last year, it fell by 35% and 32%
Naixue has lost money for four years
the market value has evaporated more than HK $20 billion
Naixue's situation is not optimistic.
After listing, Naixue broke after opening, with an intraday decline of more than 10%, closing price of HK $17.12 and market value of HK $29.363 billion. As of the noon closing on February 10, Naixue's tea offer was HK $7.03 per share, down 65% from the issue price of HK $19.8; The market value is HK $12.057 billion and the evaporation exceeds HK $20 billion.
On February 8, 2022, Naixue's tea issued a profit warning. It is estimated that by December 31, 2021, the group's revenue will be about 4.28 billion yuan - 4.32 billion yuan, with a year-on-year pre increase of more than 40%, and the adjusted net loss (not measured by international financial reporting standards) will be about 135 million yuan - 165 million yuan
screenshot of Naixue's tea profit warning announcement
This is Naixue's fourth year of loss. According to its prospectus, from 2018 to 2020, Naixue's tea revenue was 1.087 billion yuan, 2.502 billion yuan and 3.057 billion yuan; The net losses in the same period were 70 million yuan, 40 million yuan and 203 million yuan respectively, with a cumulative loss of more than 300 million yuan in three years.
But in fact, the gross profit margin of Xi tea and Naixue has been at the top of the industry. According to the calculation of Guosen Securities Co.Ltd(002736) , the gross profit margin of Xi tea is about 65% - 70%, compared with that of Naixue, which is about 62%. According to the calculation of iResearch, the overall average gross profit margin of the industry is about 53%, which is far higher than this standard.
In addition, the Red Star capital Bureau noted that the main reason why Naixue's gross profit margin is lower than that of Xi tea is that Naixue focuses on the route of "tea + European package", which makes desserts to create a third space to improve users' repurchase, and baking products have also become an important reason to bring down Naixue's tea gross profit margin.
According to the prospectus, Naixue's tea baking and other gross profit margins continued to decline. Compared with that, the gross profit margin of current tea has always remained above 65%. In other words, if the baking end of Naixue's tea is excluded, the gross profit margin is not different from that of liking tea only from the cost of tea
high cost and difficult profit
frequent quality control problems affect consumer confidence
Under the circumstances of high financing, high gross profit margin and high per capita customer unit price, Xicha and Naixue have slowed down the growth rate and flat efficiency of one store, and broke off and lost money for four years after listing. Why?
One obvious reason is the high cost.
According to a set of data provided by Zhongtai Securities Co.Ltd(600918) Research Institute, as the champion of happy tea sales, the price of a cup of "meat grape" is 29 yuan, while its raw material cost is about 8-10 yuan. For a cup of honey snow ice city with less than 10 yuan, relying on the advantages of scale efficiency and supply chain, the cost of raw materials can be stably maintained at about 3 yuan and the comprehensive gross profit margin can be maintained at more than 50%.
At first glance, there is little difference in the proportion of raw material costs between the two, but if you add various costs such as rent, water and electricity, and measure the profitability of each enterprise in a single store, you can see the more three-dimensional difference.
Red Star capital Bureau has found that under the per capita customer unit price of 43 yuan of Naixue, the raw material cost is 15.7 yuan, the labor cost is 8.2 yuan, and the rental cost is 5.6 yuan. With the expenses of water, electricity and asset depreciation, the profit of single consumption and single store is less than 7 yuan.
In addition, according to media reports, the prices of all fruits, fresh milk, coconut milk, syrup and other materials required for milk tea and coffee are rising this year. In particular, the price of perfume lemon, which is widely welcomed by consumers, has risen from 4-6 yuan to 25-30 yuan a kilogram.
In addition to the rising cost, frequent food safety problems also give new tea drinkers a headache.
On August 2, 2021, Naixue's two tea stores in Beijing were fined 100000 yuan by the Beijing market supervision department for processing and using rotten fruits, and 250000 yuan and 280000 yuan by the store managers of the two stores respectively; On October 25, a store of Naixue's tea in Shanghai was fined 50000 yuan by Shanghai Jing'an District Municipal Supervision Bureau for marking false production date, shelf life or food and food additives exceeding the shelf life.
Although the new tea drinks adhere to the self-supporting mode and grasp the supply chain and management system in their own hands, due to the various flavors of existing tea drinks, they need to pretreat a large number of fruits and rely heavily on labor. In addition, the management difficulty increases after the expansion of stores, so the problem of quality control is difficult to avoid. These negative problems are affecting the confidence of consumers and capital markets
Xi cha Naixue bucked the trend and reduced the price
entered the midstream market to grab customers
In order to cover more consumers, Xi tea and Naixue adopted similar price strategies at the beginning of this year.
In early January 2022, Xi tea adjusted the prices of some products. Overall, 14 items have been reduced in varying degrees, including pure tea by 3-5 yuan, 5 fruits by 2-3 yuan, cheese by 1 yuan, and pure green Yan tea by 9 yuan. So far, the price range of hi tea products has covered from 9 yuan to more than 30 yuan
tea price reduction posts on social media
At that time, hi tea responded to the media that the price reduction was due to the brand potential, scale advantages and the accumulation of area in the supply chain, which allowed the price of some products to be adjusted without changing the product formula, materials and quality.
A week later, Naixue's tea also lowered its product price in a disguised form. In the new "limited time easy purchase" series launched by Naixue, some products have reduced the capacity or cheese cream by 5-7 yuan compared with the previous price. Insiders said that Naixue's move or a wave of price test is more like "reducing distribution and reducing price" than direct price reduction.
On January 18, Naixue's official customer service responded to the Red Star capital Bureau on the price reduction, saying that it was not a price reduction, but a flash event launched within a limited time, with only one month.
It is worth noting that the price reduction strategy of Xi tea and Naixue is actually taking place in the price rise tide of most milk tea brands.
Earlier, "China's first milk tea stock" Xiangpiaopiao Food Co.Ltd(603711) announced that it would raise the price of its main products by 2% - 8%; Subsequently, chayan Yuese, a new tea brand from couch home, announced that most milk tea products would rise by 1 to 2 yuan. Earlier, tea brands chabaidao, coco, yiyihetang and yihetang were also exposed to price increases ranging from 1-2 yuan.
In the "rising voice", Xi tea Naixue reduced the price against the trend. The outside world believes that this is conducive to expanding the customer orders of the two, which can not only cover more middle-end consumers, but also make the financial data more beautiful.
According to the data of prospective industry research institute, in 2020, the highest market share of China's current tea brands was the low-line brand honey Snow Ice City, accounting for 11.52%; Followed by middle-end brands coco Duke, shuyishaoxiancao and Guming, accounting for 10.05%, 7.88% and 7.54% respectively; The market share of high-end brands Xi tea and Naixue tea is low, only 3.71% and 2.73% respectively.
Seizing the midstream market has become one of the "problem-solving ideas" of Xi cha Naixue
new tea drink inner roll
the scale of new tea drink stores has reached 378000
However, the "price war" of high-end brands also means that it has accelerated the internal volume of the sinking industry.
According to the 2021 new tea research report released by China chain operation association, China's new tea stores have reached 378000, accounting for 65.5% of the total size of existing beverage stores.
screenshot of 2021 New Tea Research Report
In terms of financing, according to the statistics of red meal brand research institute, as of November 25, 2021, there were 32 financing cases in the new tea industry in 2021, with a total disclosed amount of more than 14 billion yuan. The number of financing events and the disclosed financing amount have been higher than that in 2020, reaching the peak in nearly 10 years.
Among the top enterprises, in addition to tea, last year, honey snow ice city also received more than 2 billion yuan of financing from meituan Longzhu and other leading enterprises. The race track is crowded, but there is a serious problem of product homogeneity among different tea brands. The raw materials of tea are basically the arrangement and combination of fruits, dairy products and small materials. Even the name and packaging appearance of tea have become more and more similar.
Xiao Yao, a Chinese partner of Reese strategic positioning consulting, once said: "Naixue's tea, Xi tea and LeLe tea have not established the advantages of real differentiation. Although each family believes that there are more preferred consumers, the substitutability between actual brands is very strong."
In addition to the severe competitive pressure, the impact of the epidemic on catering enterprises is also difficult to ignore.
In the second half of last year, the epidemic was repeated, and many government departments strengthened public health control measures. Many tea brand stores were affected, suspending business or reducing business hours. According to the data of the National Bureau of statistics, before 2019, the sales of the catering industry basically maintained an annual growth rate of 10%. As of October 2021, the total sales of the catering industry was basically the same as that in 2019.
In addition, the growth rate of the new tea market is gradually slowing down. According to the 2021 new tea research report, the growth rate of the new tea market in 2020 is 26.1%, and the growth rate has decreased to about 19% from 2021 to 2022. The overall growth rate of the track in the next 2-3 years will be adjusted to 10% - 15%. The characteristics of the industry show that the brands dominated by direct sales have opened stores steadily, while the brands dominated by franchise have developed and differentiated and entered the shuffle period.
In 2022, the Red Star capital Bureau will continue to pay attention to the development of the new tea track and the future of the new tea.
