HAIDILAO(HK:06862) 3 6 Ke·2024-04-19 02:39Core Insights - The rising prices of hot pot bases have sparked significant public debate, with 75% of respondents considering a base price of over 60 yuan to be expensive [1][3] - The hot pot industry is experiencing intense competition, with a notable increase in new establishments and a higher rate of closures, indicating a challenging market environment [3][4][7] Industry Trends - In Q1 2024, 11,400 new hot pot-related businesses were registered, while 12,700 were closed, highlighting the competitive pressure in the sector [3] - The trend of aggressive expansion by hot pot brands continues, with some offering zero franchise fees and substantial subsidies to attract franchisees [4][10] - The market is witnessing a shift towards lower-priced offerings, with many establishments engaging in price wars to attract customers, leading to reduced profit margins [9][11] Consumer Behavior - Consumers are increasingly sensitive to pricing, with many expressing dissatisfaction over high base prices for hot pot, leading to a decline in patronage [1][6] - The emergence of alternative dining options, such as small hot pots and street food, is fragmenting consumer demand and further intensifying competition [9][10] Business Challenges - Many hot pot establishments are struggling to maintain profitability, with reports of significant losses shortly after opening, indicating a high-risk environment for new entrants [4][6] - The oversaturation of the market, particularly in densely populated areas, is making it difficult for new businesses to attract and retain customers [6][7] Future Outlook - Industry experts predict that the hot pot sector will continue to face challenges in 2024, with ongoing competition and a potential for further market consolidation [4][10] - The focus on brand differentiation and understanding consumer needs will be crucial for survival in an increasingly competitive landscape [10][11]