Core Insights - The hot pot industry is experiencing a significant shift from "incremental competition" to "stock competition," with a noticeable slowdown in market growth [6][8] - The main battleground for hot pot consumption is shifting towards affordable price ranges, with a marked increase in stores offering average spending of 70 RMB or less, while those above 90 RMB are declining sharply [3][8] Industry Overview - The national hot pot market is projected to reach 617.5 billion RMB in 2024, maintaining a year-on-year growth of 5.6%, although this is a decline compared to 2023 [6] - The number of hot pot establishments is expected to decrease from approximately 535,500 in Q3 2024 to about 504,800 by Q1 2025 [6] Consumer Behavior - Consumer spending in the hot pot sector has been on a downward trend, dropping from over 80 RMB to around 70 RMB by the end of 2024 [8] - The proportion of stores with average spending above 90 RMB has decreased by 16.9 percentage points, while those at 70 RMB or below have increased by 20.9 percentage points [8] Company Performance - Brands like Ba Nu and Cou Cou are facing declining average spending, with Ba Nu's customer spending dropping from 150 RMB in 2023 to 138 RMB in 2025, and Cou Cou's from 143.8 RMB to 137.8 RMB [10][12] - Ba Nu's same-store sales fell by 9.9% from 2023 to 2024, despite an increase in table turnover rates [15] Competitive Strategies - The industry consensus is shifting towards "price reduction for survival," with companies like Hai Di Lao and Nan Hot Pot announcing significant price cuts to adapt to market conditions [9][10] - Ba Nu is cautiously adjusting its product offerings and pricing strategies to maintain competitiveness, while Cou Cou is struggling to adapt to the changing market dynamics [15][16] Consumer Feedback - Consumers express dissatisfaction with the perceived value of mid-to-high-end hot pot brands, indicating that price reductions have not effectively addressed their expectations [17][19] - The challenge for brands is to maintain quality perception while adjusting to lower price points, as many consumers feel that the quality has diminished over time [20] Future Outlook - The hot pot industry is facing systemic challenges, and companies may need to diversify their offerings beyond traditional hot pot to sustain growth [21]

Core Insights - The hot pot industry in China is experiencing a significant shift from "incremental competition" to "stock competition," with a noticeable slowdown in market growth and a focus on price-sensitive consumers [5][6][10] Industry Overview - The national hot pot market size for 2024 is projected to be 617.5 billion RMB, reflecting a 5.6% year-on-year growth, although this is a decline compared to 2023 [5] - The number of hot pot restaurants is expected to decrease from approximately 535,500 in Q3 2024 to 504,800 by Q1 2025 [5][6] Consumer Behavior - There is a marked shift towards budget-friendly hot pot options, with establishments charging 70 RMB or less seeing a 20.9% increase in market share, while those charging over 90 RMB have seen a 16.9 percentage point decline [6] - Consumer spending in the hot pot sector has decreased from over 80 RMB to around 70 RMB by the end of 2024 [6] Company Performance - Brands like Ba Nu and Cou Cou are facing declining average spending per customer, with Ba Nu's average dropping from 150 RMB in 2023 to 138 RMB in 2025, and Cou Cou's from 143.8 RMB to 137.8 RMB [8][9] - Ba Nu has adjusted its product offerings to maintain competitiveness, including changes to its menu and pricing strategies [13][14] Competitive Strategies - The industry consensus has shifted towards "price reduction for survival," with companies like Hai Di Lao reporting a drop in average spending to 97.9 RMB [7] - Ba Nu and Cou Cou are implementing various strategies, such as membership programs and smaller portion options, to attract price-sensitive consumers [14][15] Market Challenges - Despite efforts to lower prices, consumer perception of value remains a challenge, with many feeling that the quality of offerings has diminished [15][17] - The hot pot industry is facing systemic challenges, leading some companies to explore alternative revenue streams, such as launching sub-brands [18]