On February 9, the news that Xicha was implementing layoffs was posted on hot search. Although Xicha denied it, the revelations on various social platforms still attracted attention.
After experiencing great prosperity, the new tea industry began to shuffle. In 2021, many new tea drinking enterprises such as miyue ice city and aunt Hushang raised funds one after another, and tea Yan Yuese and LeLe tea went out of the local market. Naixue’s tea was listed on the Hong Kong Stock Exchange and became the first share of new tea drinks. However, Naixue’s tea recently released the latest performance forecast, saying that it is expected to lose more than 100 million yuan in 2021, and chayan Yuese is trying to increase efficiency by raising prices and reducing costs.
the profitability of head players decreased
According to people familiar with the matter quoted by the media, Xicha has started layoffs, involving 30% of its employees. Some employees said that all employees had no year-end bonus, while others said that “deferred payment”. All information security departments were cut, and the store expansion department was cut by 50%.
On February 10, the reporter of Securities Daily verified the matter with Xi cha. The other party responded 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 year-end assessment. At the same time, the year-end bonus of employees has been normally distributed to employees before the Spring Festival according to their performance.
Although Xi tea denied major layoffs, many media quoted industry insiders as saying that Xi tea reported layoffs at this time, which may be intended to accelerate the listing process in 2022.
It is worth noting that listing is not once and for all.
As a leading enterprise in the new tea industry, Naixue’s tea has been listed first. In June 2021, after repeatedly denying the listing rumors, Naixue’s tea with the aura of “the first share of new tea” officially landed on the Hong Kong stock exchange. Although the dark trading once rose more than 11% the day before, Naixue’s tea broke off at the opening of the first day of listing, opening 4.75% lower and closing at HK $17.12 per share, down 13.54%. Subsequently, Naixue’s tea share price was basically in a volatile downward trend.
On February 8, the latest performance forecast of Naixue tea said that the revenue in 2021 is expected to reach 4.28 billion yuan to 4.32 billion yuan, and the adjusted loss is 135 million yuan to 165 million yuan.
And the days of loving tea are not as good as before. According to the data of Jiuqian consulting Zhongtai, the number of stores of Xicha did not exceed 800 until the third quarter of 2021, reaching 835 stores. The growth of stores was mainly concentrated in the first and second tier cities. In addition to the slowdown of store growth, the average profitability of Xi tea stores also began to decline. From July 2021, the average floor efficiency and average store income of Xi tea across the country began to decline. Taking the data of October 2021 as an example, the average revenue and sales floor effect of Xi tea stores decreased by 19% and 18% month on month compared with July; Compared with the same period last year, it fell by 35% and 32%.
“The development of chain tea has always been based on rapid expansion, not profitability.” Meng Qi, former head of Jingdong new channel strategy, told the Securities Daily that under the general environment of conservative overall consumption, rental costs and personnel costs are rising year by year, and some supply chain costs are difficult to optimize, so it is not difficult to predict the current situation.
waist players reduce costs and increase efficiency
In addition to the above two leading enterprises, the life of regional new tea brands such as tea Yan Yuese and LeLe tea is also difficult.
In November 2021, Changsha wanghong brand tea Yan Yuese boarded the hot search because 87 stores were closed. A month later, chayan Yuese once again boarded the hot search because of a fierce quarrel over the low salary of employees. When the founder of chayan Yuese released an internal apology letter, he revealed that during the epidemic, chayan Yuese lost more than 20 million yuan a month.
At that time, Cha Yan Yuese said on her microblog: “this round has been the third temporary centralized closure of stores in 2021. The temporarily closed stores will gradually reopen after the epidemic eases.”
Faster than the store’s recovery is the price rise. In January 5th, tea yam Yue announced its price rise notice in its official account. The price range was mainly concentrated in milk tea products, most of which were 1 yuan, and the new price was opened in January 7th. The last price adjustment was in 2016.
In this regard, chayan Yuese said that the reason why there was no price increase in the previous five years is that there are two advantages: one is the brand dividend, and the other is the procurement dividend brought by the expansion of scale.
However, in the eyes of the outside world, “one tea is hard to find”, scalpers and other grand occasions are no longer pleasant. At this time, raising the price is more like a move in the combination of controlling costs and pursuing profits.
In addition, Lele tea also announced the closure of the last store in Xi’an on October 15 last year to bid farewell to the Xi’an market for the time being.
While reducing the cost and increasing efficiency of tea Yan Yue Se and LeLe tea, Xi tea and Naixue’s tea, as the head brand of new tea drinks, went against the wind: Xi tea reduced the price of some products by about 1 to 5 yuan, and Naixue’s tea reduced the price in disguise by “Limited time and easy purchase”, with a price reduction range of 5-7 yuan. Immediately, the reverse operation of the head player triggered a heated discussion.
“The competition in China’s tea market has entered a white hot stage. While fighting for brands, Chinese new tea has been close to saturation, and the industry dividend is gradually fading.” Zhu danpeng, a researcher at the China Food Research Institute, told the Securities Daily that in this context, head brands such as Xi tea and Naixue tea also began to change their original strategic positioning, including paying attention to the offline market and layout the medium and low-end market to meet the needs of more consumers.
With the superposition of the impact of the epidemic and the sharp increase in the number of stores, many new tea brands have had a hard time in the past two years. The 2021 new tea research report points out that in the next two to three years, the income growth of the new tea market will slow down periodically. One of the reasons is the consolidation of the sinking market and the development of the market in the north of the West. Sealand Securities Co.Ltd(000750) the research report points out that geographically, the market of new tea brands in the first and second tier cities has reached saturation, and it is necessary to turn to the sinking market to seek new growth points.
