Core Viewpoint - The controversy surrounding Baiguoyuan's chairman's remarks has intensified public scrutiny over the company's declining performance, store closures, and food safety issues, leading to questions about its business model and brand value [1][2]. Financial Performance - In 2024, Baiguoyuan reported a revenue of 10.273 billion yuan, a year-on-year decline of 9.8% [2] - The company experienced a net loss of 386 million yuan, marking a staggering year-on-year drop of 206.7%, representing its first loss since going public [2] - The number of stores decreased from 6,093 in 2023 to 5,127 in 2024, resulting in the closure of 966 stores, averaging 2.64 closures per day [2] - The gross profit margin fell from 11.5% to 7.4%, indicating a significant decline in profitability [2] Strategic Issues - Baiguoyuan's high-end pricing strategy has failed, as evidenced by the need to implement low-price promotions to attract customers, despite the chairman's insistence on not lowering prices [2] - The company's focus on "educating consumers" has alienated its customer base, particularly in lower-tier markets where price sensitivity is high [3] - Rapid expansion has led to a decline in supply chain and quality control capabilities, exacerbating the challenges faced by franchisees and contributing to the wave of store closures [3] Brand and Market Perception - The company's high-end image has been severely damaged by food safety scandals, including the use of rotten fruit in products and lack of proper food handling certifications [2] - Consumer backlash has been significant, with numerous complaints about product quality, leading to a perception of Baiguoyuan as out of touch with market demands [1][2] - Comparisons have been drawn between Baiguoyuan and other failed brands, highlighting the risks of high pricing combined with low quality [1]