Sou Hu Cai Jing·2025-06-05 19:17Core Viewpoint - The current subsidy-driven price war may create a temporary increase in demand but could lead to significant long-term issues for businesses once subsidies are withdrawn [2][9][10] Group 1: Impact of Subsidies - User subsidies are likely to distort the normal development path of businesses, resulting in potential overcapacity in the future [2][3] - The immediate effect of subsidies may lead to impulsive consumption, but once subsidies are removed, demand is expected to revert to initial levels, causing challenges for businesses that have expanded capacity [6][9] - The current focus for local lifestyle businesses should be on optimizing and adjusting operational costs rather than relying on user subsidies to boost demand [2][13] Group 2: Industry Dynamics - The restaurant industry faces a significant burden from fixed costs, which account for about one-third of operational expenses, necessitating a focus on cost structure optimization [13][14] - The competitive landscape is characterized by aggressive price wars, with companies like Kudi Coffee rapidly expanding while facing operational challenges due to rising costs and market saturation [7][8] - The entry of capital into the market has exacerbated the distortion of normal business development paths, leading to a potential crisis for smaller businesses unable to compete [7][9] Group 3: Recommendations for Businesses - Businesses are advised to remain cautious and avoid impulsive expansion based on short-term gains from subsidies, as this could lead to severe repercussions in the future [2][15] - Companies should consider innovative business models, such as the "brand satellite store" concept, to reduce fixed costs and improve operational efficiency [13][14] - The industry should shift focus from user subsidies to strategies that enhance operational efficiency and cost management to ensure sustainable growth [11][12]