Core Viewpoint - The rapid rise of "fresh boiled beef rice noodle" restaurants has been followed by a significant wave of closures, highlighting the volatility of the restaurant industry and the challenges of sustaining consumer interest beyond initial novelty [5][19][34]. Group 1: Market Dynamics - The "fresh" trend in the restaurant industry saw a surge in popularity, with many brands rapidly expanding, leading to over 1,000 new stores opening across the country [5][19]. - However, this trend quickly turned into a closure wave, with numerous stores shutting down within months of opening, indicating a lack of sustainable business models [2][6][20]. - The phenomenon of closures is widespread, affecting both independent and chain restaurants, with many locations reporting empty storefronts and signs of "for rent" [7][10][19]. Group 2: Franchise and Investment Issues - The rise in closures has been accompanied by a surge in franchise disputes, with many entrepreneurs facing significant financial losses after investing in these businesses [11][12]. - Many franchisees reported low daily revenues and high operational costs, leading to quick exits from the market [12][14]. - The allure of low entry barriers and high returns has drawn many inexperienced entrepreneurs, who often find themselves in a "rapid loss" situation instead of achieving profitability [14][19]. Group 3: Consumer Behavior and Market Saturation - The rapid proliferation of similar restaurants has led to market saturation, diluting customer traffic and resulting in many establishments struggling to attract patrons [26][28]. - Consumers have shown a tendency to return to rational purchasing behavior after the initial novelty wears off, leading to dissatisfaction with the lack of differentiation among offerings [30][32]. - The reliance on marketing gimmicks and visual appeal without substantial product quality has resulted in a failure to foster customer loyalty and repeat business [32][34]. Group 4: Lessons for the Industry - The swift rise and fall of "fresh boiled beef rice noodle" restaurants serve as a cautionary tale for the restaurant industry, emphasizing the importance of product quality and differentiation over mere marketing hype [33][35]. - The industry must focus on sustainable practices, including supply chain management and product integrity, to build long-term value rather than chasing fleeting trends [35][36].

Core Insights - The rise of "super franchisees" in the Chinese restaurant industry reflects a shift from individual operators to professional investors with multiple outlets and sophisticated management teams [8][9][26] - The rapid turnover of restaurant brands, with an average lifecycle of 18 months, creates a high-stakes environment for franchisees who must continuously adapt to market changes [24][25] - Information sharing among franchisees through platforms like "Pengyouhui" helps mitigate risks and identify profitable opportunities, fostering a community of support [10][11][12] Group 1: Super Franchisees - Super franchisees are characterized by their ability to manage multiple outlets and leverage market intelligence, distinguishing them from traditional small-scale operators [8][9] - The emergence of super franchisees is a key driver in the maturation of the restaurant franchise industry in China, allowing for collective strength against market challenges [9][21] - The community formed by super franchisees enables them to share experiences and insights, which is crucial for navigating the fast-paced market [10][11] Group 2: Market Dynamics - The restaurant industry is marked by intense competition, with many brands experiencing rapid growth followed by swift decline, necessitating quick decision-making from franchisees [24][25] - Franchisees often face challenges such as supply chain issues and price wars, which can significantly impact profitability [15][16] - The relationship between franchisees and brands is often adversarial, with franchisees feeling the pressure of brand decisions that affect their bottom line [13][14] Group 3: Brand Selection and Strategy - Franchisees prioritize brands with strong market potential and quick return on investment, often seeking to recoup costs within 18 months [23][25] - The choice of location and brand is critical, as poor decisions can lead to significant financial losses [19][21] - Franchisees are increasingly cautious about new brand opportunities, often relying on community insights to avoid pitfalls associated with less established brands [10][11][12] Group 4: Operational Challenges - Franchisees must navigate stringent operational requirements imposed by brands, which can lead to increased costs and reduced flexibility [16][17] - Negative publicity surrounding a brand can have widespread repercussions for all franchisees, highlighting the interconnected nature of the franchise ecosystem [30][31] - Franchisees are exploring innovative strategies, such as targeting niche markets or leveraging seasonal trends, to enhance profitability and reduce competition [32][33]

Core Viewpoint - Aoi Sushi is embarking on a new journey towards 2025, focusing on quality and innovation while inviting partners to join in creating a new sushi blueprint [1] Group 1: Brand Expansion - Aoi Sushi has established over 400 stores nationwide after 11 years of development in South China, gaining significant customer trust and popularity [3] - The brand successfully opened 15 new stores in Guangxi in June, enhancing its brand recognition and solidifying its position in the Guangxi market [3] Group 2: New Market Opportunities - Aoi Sushi is expanding into four new regions: Hunan, Jiangxi, Sichuan (excluding Mianyang), and Chongqing, which have substantial market potential and consumer demand for high-quality sushi [5] - The entry into these regions is expected to introduce a new culinary experience and fill the market gap for quality sushi, particularly in Sichuan, which has a large population [5] Group 3: Support for Entrepreneurs - To lower the barriers for entrepreneurship, Aoi Sushi is offering a promotional support policy that includes a reduction of 10,000 yuan in cooperation fees and 5,000 yuan in security deposits for qualifying stores [6] - The brand will provide comprehensive support to partners, including site evaluation, staff training, and marketing strategies to help new stores quickly gain market presence [6]

Core Viewpoint - The article discusses the cautious approach of Haidilao in opening its franchise model, emphasizing the stringent requirements for potential franchisees and the strategic aim to penetrate lower-tier markets in China [4][5][19]. Summary by Sections Franchise Application Process - Haidilao received over 20,000 franchise applications since announcing its franchise model in March 2024, but less than 0.1% of applicants successfully became franchisees [4][5]. - The franchise requirements include a minimum investment of 10 million RMB (approximately 1.4 million USD) and a strong financial foundation for multi-store development [4][5]. - The selection process involves multiple rounds of assessments to ensure alignment with Haidilao's corporate culture and long-term vision [4][8][17]. Target Market and Strategy - The majority (70%) of franchise applicants are from third-tier cities and below, indicating Haidilao's focus on expanding into lower-tier markets [5][19]. - The company aims to leverage franchise partnerships to tap into the significant consumer potential in these markets, where traditional expansion methods may be limited [19][22]. - Haidilao's revenue from third-tier cities has surpassed 40%, with performance in these areas exceeding that of first-tier cities [19][22]. Franchisee Profile - Applicants come from diverse backgrounds, including professional franchisees, property owners, industry transitioners, and institutional investors [11][12]. - The franchise model is seen as a tailored investment opportunity for affluent individuals in lower-tier cities, with a focus on long-term returns rather than quick profits [5][32][33]. Operational Control and Management - Haidilao employs a "strong management" model for franchise operations, meaning franchisees have limited control over daily operations, which are managed by Haidilao's experienced staff [27][30]. - This model aims to maintain brand consistency and quality across all locations, ensuring that franchisees can benefit from the established operational framework [30][31]. Market Dynamics - The article highlights the competitive landscape in lower-tier markets, where quality locations and capable franchisees are scarce [22][24]. - Haidilao's strategy of opening franchises is positioned as a means to gain a competitive edge in these markets, where traditional expansion methods may not suffice [26][30].

Core Insights - The restaurant franchise market is transitioning from rapid expansion to a focus on quality and sustainability, as evidenced by the cautious yet ambitious strategies of leading brands like Haidilao and Luckin Coffee [4][5][14] - Leading brands are adopting rigorous management practices to ensure high survival rates for franchisees, emphasizing quality over quantity in their expansion strategies [6][7][13] Group 1: Market Trends - Since the second half of last year, discussions around restaurant franchising have cooled, with many brands that aimed for rapid expansion slowing down [1] - Despite this, Haidilao has received over 20,000 franchise applications since opening its franchise model in March last year, indicating strong interest in top brands [1][5] - Luckin Coffee has launched a new franchise recruitment plan targeting over 800 premium locations across 186 cities, reflecting confidence in its franchise model [1][5] Group 2: Performance Metrics - Hefo Noodle achieved a transaction volume of 2.5 billion in 2024, ranking first among Chinese noodle restaurants, and has seen a significant recovery after a 32% price reduction [3] - In Q1 2025, Hefo Noodle reported exceeding revenue and profit targets, with over 10% of its stores being franchises, indicating a successful pivot towards franchising [3][9] Group 3: Franchise Management Strategies - Leading brands are moving towards a "high-quality development" model, focusing on sustainable practices rather than aggressive expansion [4][6] - Haidilao has implemented a strict management model for its franchises, with a survival rate of only 1% for new franchise stores, ensuring quality control [6][7] - Hefo Noodle employs a multi-tiered vetting process for franchisees, achieving a 95% survival rate for its franchise stores through careful site selection and operational support [6][9] Group 4: Consumer Trust and Brand Loyalty - Hefo Noodle has established a transparent supply chain and operational monitoring system, enhancing consumer trust and driving customer loyalty [10][11] - The brand's commitment to quality ingredients and a standardized supply chain has positioned it as a leader in the market, balancing affordability with high quality [10][11] Group 5: Future Outlook - The restaurant industry is expected to see a shift towards quality-focused franchising, with leading brands setting new standards for operational excellence [13][14] - The competitive landscape will increasingly favor brands that can integrate quality control and efficient supply chain management, paving the way for sustainable growth in the franchise sector [10][14]

Core Viewpoint - Haidilao's cautious approach to franchise expansion aims to penetrate lower-tier cities while maintaining brand control and operational consistency through a "strong management" strategy [2][10][12]. Summary by Sections Franchise Strategy - Haidilao opened its franchise model in March 2024, receiving over 20,000 applications but only establishing 13 franchise stores, primarily converting existing locations [1][2]. - The franchise strategy focuses on attracting "mysterious franchisees" with significant resources and local connections, particularly in third-tier cities [2][4]. Franchisee Characteristics - The franchisees are categorized into four types: professional franchisees, property owners, industry transitioners, and institutional investors, all possessing substantial financial backing and local market knowledge [6][5]. - The franchise application process includes rigorous online evaluations and multiple interview rounds to ensure alignment with Haidilao's values and operational standards [6][7]. Operational Control - Haidilao employs a "strong management" model, requiring franchisees to purchase existing stores and adhere strictly to corporate guidelines, ensuring consistency with the brand's operational standards [10][12]. - This model allows franchisees to leverage existing customer bases and operational frameworks, facilitating quicker market entry and brand establishment [10][11]. Market Dynamics - The franchise model is part of a broader trend in the hot pot market, with significant growth in lower-tier cities, where the number of hot pot restaurants has increased by 18% year-on-year [4][19]. - Haidilao's strategy contrasts with other brands that allow greater operational autonomy, positioning itself as a more controlled franchise model [14][15]. Future Prospects - Haidilao aims to expand its franchise operations further, with plans to eventually apply the franchise model to its sub-brands, enhancing overall market presence [18][19]. - The company is currently focused on processing the influx of franchise applications and establishing a robust operational framework to support future growth [18][19].

Core Viewpoint - The conflict between restaurant brands and franchisees is intensifying, exemplified by the recent name change of nearly 40 stores from "Electric Plant Noodle" to "Zhu Popo Sweet Noodle," highlighting the underlying tensions in the franchise model [1][2]. Group 1: Incident Overview - The incident involves the "Electric Plant Noodle" brand, which currently has nearly 50 stores [2]. - Franchisee Zhu Liye opened her first store in Jinan in 2021 and expanded to nearly 40 stores over four years [2]. - Disputes arose over rising franchise fees, which increased from 15,800 to 39,800, along with demands for substantial security deposits [2][3]. Group 2: Franchisee's Perspective - Zhu Liye expressed frustration over the lack of operational support from the brand, feeling that she was left to manage without adequate assistance [2]. - After refusing to pay the demanded security deposit, Zhu stopped purchasing core supplies from the brand and rebranded her stores [3]. Group 3: Brand's Perspective - The brand accused Zhu of mixing their proprietary ingredients with others to cut costs, justifying the demand for a security deposit [3]. - Following the rebranding, the brand issued legal notices claiming Zhu's actions constituted a breach of contract [3]. Group 4: Broader Industry Context - The article discusses the increasing frequency of disputes between restaurant brands and franchisees, citing examples like Xianhe Zhuang and Natural Daze, which faced similar legal challenges [4][7]. - Common issues include disagreements over return on investment timelines, rising operational costs, and inadequate support from brand headquarters [8][9][10]. Group 5: Future Trends - The franchise model is seen as a key avenue for growth and industry upgrade in the restaurant sector, with major brands like Haidilao and Hey Tea entering the franchise market [12]. - The emergence of professional franchisees who manage multiple locations is becoming more common, indicating a shift in the franchise landscape [14].