HAIDILAO(HK:06862) 投中网·2025-06-24 05:16Core Viewpoint - The article discusses the cautious yet strategic approach of Haidilao in opening its franchise model, emphasizing the high standards and selective criteria for potential franchisees, particularly targeting the lower-tier markets in China [5][10][11]. Summary by Sections Franchise Conditions - Haidilao has set stringent franchise conditions, requiring potential franchisees to invest at least 10 million yuan (approximately 1.4 million USD) without loans, and to possess financial capabilities for multi-store development and local property resources [6][10]. - The company conducts multiple rounds of qualification assessments to ensure alignment with its corporate culture and long-term vision [7][27]. Franchise Application Process - Out of over 20,000 applications received, more than 10,000 have completed the evaluation process, but only 13 franchises have been finalized, with 10 being transfers of existing stores [8][10]. - The application process includes several stages: initial online assessments, interviews focusing on business plans and brand understanding, and final evaluations by senior management [23][25]. Target Market and Strategy - Haidilao aims to penetrate lower-tier markets, with 70% of franchise applicants coming from third-tier cities and below, where the company sees significant growth potential [11][29]. - The company’s revenue from second and third-tier cities has reportedly exceeded that from first-tier cities, indicating a strategic shift towards these markets [29][32]. Market Dynamics - The lower-tier market represents a vast consumer base, accounting for nearly 70% of China's population and contributing significantly to retail consumption [29][32]. - The competition for prime locations in these markets is intense, with limited commercial centers available, making the selection of franchisees crucial [32][36]. Operational Control - Haidilao employs a "strong management" model for its franchises, meaning that while franchisees own the stores, they have limited control over daily operations, which are managed by Haidilao [37][39]. - This model aims to maintain brand consistency and quality across all locations, ensuring that franchisees can benefit from the established operational framework without the burden of daily management [39][40]. Investment Perspective - The investment in a Haidilao franchise is viewed as a long-term opportunity rather than a quick return, appealing to wealthy individuals in lower-tier cities who seek stable returns [40][41]. - The company positions itself as a competitive investment option in the market, attracting affluent individuals who recognize the brand's value and operational success [41].