Source: Securities Times
Author: Hu Huaxiong

People take food first, and the catering industry can play an important role in meeting residents' food needs, stabilizing employment, and promoting domestic demand.

Since this year, the operation of domestic catering enterprises has returned to a growth trajectory, and the performance of related enterprises has been clearly repaired, or has regained a relatively rapid pace of growth.

The reporter's interview and investigation found that in the face of new changes after the epidemic, catering companies are trying to expand their territory or find new growth points to further enhance market competitiveness through various methods such as expanding overseas, innovating products, adjusting structures, upgrading services, and strengthening marketing.

Reporter's investigation: Food and beverage consumption has clearly recovered 

According to data previously disclosed by the National Bureau of Statistics, food and beverage revenue for September this year was 428.7 billion yuan, an increase of 13.8% over the previous year. In January-September of this year, food and beverage revenue was 3710.5 billion yuan, an increase of 18.7%. Overall, whether in January-September of this year or September of this year in a single month, the growth rate of food and beverage revenue was higher than the growth rate of total retail sales of consumer goods in the same period.

According to the reporter's field research and in-store dine-in observations, since this year, during peak dining periods in Tier 1 and 2 cities, many brand restaurants have basically been fully booked, and during off-peak hours, quite a few customers have also eaten. Compared to dining experiences during the pandemic, the biggest feeling is that popularity has clearly rebounded.

In mid-October, at the hot pot faucet$HAIDILAO (06862.HK)$At a store in Shenzhen, the reporter discovered that between 18:00 and 20:00 that evening, the store was basically full, and some customers still needed to wait. Among consumer customers, like reporters, many celebrate their birthdays for relatives and friends. Haidilao also thoughtfully provides services such as singing and sending birthday wishes. After 21:00 p.m. during off-peak hours, the reporter discovered that although the seats were no longer full, there were still quite a few people eating.

In addition to Haidilao, the reporter also recently went to another brand of hot pot restaurant in Shenzhen during the peak dining season at night. Although this hot pot restaurant is not well known, it is also mostly full during peak hours.

In some traditional Chinese restaurants that are not hot pot types, judging from the reporter's field visits, the number of visitors is also generally much better than the same period last year.

Also, in recent years, hi cha has been loved by young people,$NAYUKI (02150.HK)$New-style tea drinks, such as, and tea with a pleasant color, are on the rise one after another. Recently, the reporter discovered that it is rare for customers of these brands to line up to place orders, and there are also quite a few people who place orders in advance in the applet in order to avoid waiting for a long time. At the Cha Community Mall store in Nai Xue, Shenzhen, the reporter discovered that after 21:00 p.m. on weekdays, there were still quite a few customers visiting one after another.

Listed catering companies$JIUMAOJIU (09922.HK)$In an interview with a reporter from the Securities Times, they said that from October 19 to 25, the Jiumaojiu brand Tai2 had more than 1.18 million visitors to more than 500 stores nationwide, and the overall number of queuing numbers exceeded 290,000; the total number of visitors to Chongqing Hot Pot Factory's 50 stores nationwide exceeded 170,000, and the total number of scheduled tables was 2,200; the store with the best performance was Chongqing Hot Pot Factory's Zhengjia Store. The average daily turnover during this period was 100,000, and the average number of queuing people was over 600 people per day.

However, during the previous double festival period, the five major brands under the Jiumaojiu Group all welcomed a high level of traffic. Among them, the number of diners from Tai'er nationwide on October 1-3 exceeded 680,000, and the number of orders exceeded 260,000; the total number of people queuing up at the store with the highest turnover exceeded 1,700, and the dine-in turnover rate exceeded 9. Meanwhile, during the first three days of the holiday period, Chongqing Hot Pot Factory had a reservation rate of 90% in stores nationwide. Among them, the turnover rate of many stores was over 7, and in total, it received more than 130,000 visitors.

Haidilao told the Securities Times reporter that the upcoming Double Eleven brought a peak in order placement on Haidilao's member stores and other e-commerce platforms. According to the data, after the official Heidilao flagship store on the Tmall platform started pre-sale on October 24, the number of deposit payments increased 20% over the same period last year; after the launch of the Douyin channel's big promotion, the order volume increased, and the order volume rose 260% compared to weekdays.

The Haidilao side also told reporters that in the eight days from September 29 to October 6, 2023 during the previous Mid-Autumn Festival and National Day, Haidilao stores received more than 13 million customers, and the average number of visitors to the store increased by more than 70% compared to the 2019 National Day.

Listed catering companies generally achieved growth in performance

Recently, the performance of many catering companies has also surfaced.

For example$China Quanjude (002186.SZ)$According to the recently disclosed three-quarter report for 2023, the company achieved operating income of 1.09 billion yuan in the first three quarters of 2023, an increase of 93.15% over the previous year, and realized net profit attributable to shareholders of listed companies of 71.7464 million yuan, an increase of 140.9% over the previous year. Among them, in a single quarter of the third quarter, Quanjude achieved operating income of 422 million yuan, an increase of 78.09% over the previous year, and realized net profit attributable to shareholders of listed companies of 43.829,700 yuan, a sharp increase of 292.98% over the previous year.

Quan Jude said that since 2023, demand for food and beverage consumption in China has been drastically released, and the catering market has clearly rebounded. In the third quarter, the company seized the opportunity to seize efficiency and launch a “100-day offensive” campaign with the theme of “increasing reputation, increasing revenue, and increasing efficiency.” Both operating income and total profit increased significantly over the same period last year.

$Xi'an Catering (000721.SZ)$According to the recently disclosed three-quarter report, the company's revenue for the first three quarters of 2023 was about 586 million yuan, an increase of 54.45% over the previous year. Among them, the single-quarter revenue for the third quarter was about 207 million yuan, an increase of 45.02% over the previous year. As for the reason for the increase in operating income, Xi'an Food stated in its three-quarter report that it was due to the recovery in the restaurant market from the beginning of the year to the end of the reporting period.

$Tongqinglou Catering Corporation (605108.SH)$According to the recently disclosed three-quarter report, the company achieved operating income of 1,683 billion yuan in the first three quarters of 2023, an increase of 34.95% over the same period last year, an increase of 58.77% over the same period in 2019, and net profit attributable to shareholders of listed companies of 203 million yuan, an increase of 131.19% over the same period last year and an increase of 49.93% over the same period in 2019. Tongqinglou said that the company's operations have completely surpassed pre-epidemic levels, and all business indicators have shown a rapid growth trend.

Catering companies listed on the Hong Kong stock market have yet to disclose their three-quarter report results, but judging from the semi-annual reports that these companies have already disclosed, revenue and profit have also generally recorded strong growth, with nine percent,$XIABUXIABU (00520.HK)$, Nai Xue's Tea, and Haidilao all grew more than 20% in revenue in the first half of the year. Among them, Jiumaojiu's revenue for the first half of the year grew by more than 50% year on year.

However, the reporter also discovered that there is still some division within the catering business group. The operating performance of many enterprises has clearly exceeded the level before the epidemic, yet there are still some enterprises that have not fully recovered.

Catering companies make “fancy” moves to find new growth points 

At the same time as consumption is recovering overall, catering companies are also seeking to expand their territory or find new growth points to further enhance market competitiveness through various methods such as expanding overseas, innovating products, adjusting structures, upgrading services, and strengthening marketing.

For example, Jiumaojiu told the Securities Times reporter that with the recovery of consumption after the epidemic, Jiumaojiu will continue to accelerate store expansion. For example, the core brand Taiji Pickled Vegetable Fish has sunk into channels and expanded to lower-tier cities; while Chongqing Hot Pot will also open more stores in Tier 1 and 2 cities. Among them, in the expansion of markets in Hong Kong and Macao and overseas, the Jiumaojiu Group will focus on the Ether2 brand, giving priority to countries and regions with large Chinese populations, such as North America and Southeast Asia.

According to the Jiumaojiu side, in the future, Jiumaojiu will continue to invest more in the supply chain and improve the supply chain center and central kitchen, such as building a supply chain in Nansha, Guangzhou to support production and processing over the next 20 years, continuously upgrading the catering center platform system, and continuously improving food safety management.

Haidilao told the Securities Times reporter that this year, “fancy facelift” has become a major feature of Haidilao, from IP co-branding to frozen roses, concert bus pick-up... Many vivid marketing activities launched by Haidilao have been widely disseminated on social media platforms, and the reach and activation of young customers is very obvious.

Nai Xue's Tea mentioned in the recently disclosed operating situation announcement for the third quarter of 2023 that the company officially announced that in late July 2023, the company officially announced that it would open up franchise for the main brand. At the end of September 2023, the first batch of franchise stores located in Suqian, Yangzhou, Taizhou and other places in East China have begun operations or trial operations one after another. In terms of products, the company launched a campaign to buy fresh milk tea for RMB 9.9 this quarter, and expects to continue to launch similar activities for some time to come. In this quarter, the share of fresh milk tea sales increased significantly, which may help boost the Group's winter sales performance. In terms of marketing, the company continues to attract consumers to try new things and buy again through joint activities and other means. In this quarter, the company collaborated with Magical Card Girl Sakura and Jay Chou's classic album “Fantasie” to launch products, which received a good market response.

Quan Jude said in the Three Quarterly Report that in the catering sector, the company has further consolidated the profitability of the three major stores. The Heping store “China's Best: Sky Courtyard”, Qianmen's “Central Food Restaurant”, and Wangfujing's “Gong Xi • Longfeng Chengxiang” project have driven a simultaneous rise in store revenue, profit, and store reputation; the Quanjude brand won Meituan Takeout's must-try brand in 2023, forming an effective revenue complement; Food innovation and adjustment results have been remarkable, and the proportion of innovative food sales has increased, showing a positive trend in business development.。

editor/tolk