Author: Le Yan Jie Shuyi
Internet celebrity cake LADY M is about to close all existing stores in the Chinese mainland market on September 10. Just a few days ago, a reporter from Yicai came to a store of the brand and personally tested the LADY M Internet celebrity cake of 75 yuan per cake. Even with such a high price, there are still a large number of customers queuing up in the store to buy.
Just recently, not only LADY M, but the well-known bakery chain Christine (01210.HK) stores have experienced a large number of closures.
After combing the public information and conducting on-site interviews, a reporter from China Business News found that in 2021, many stores in Yizhi, which used to be everywhere in the subway, were closed overnight, and the number of remaining stores is very small.
Also in 2021, the more famous Donghaitang in Guangzhou also announced its closure.
BreadTalk withdrew from the Xi'an market in February 2022.
Behind this series of store closures is the rise of a large number of new brands in the baking industry, resulting in serious "involution" in the industry, and the impact of the epidemic on the consumer industry, making it difficult for these old and new baking brands to maintain.
New and old brands go forward one after another
Recently, a reporter from China Business News passed a Christine store at the Dingxi intersection of Wuyi Road, Changning District and found that the store has been renovated and will be converted into a steamed bun store, but the original word "Christine" still exists. Not erased.
The reporter searched for "Christine" in Dianping and found that dozens of Christines in Shanghai were all suspended, and none of them answered the phone.
After the epidemic hit, the reshuffle of the baking industry was even more cruel.
Not only are some chain brands facing operational challenges, but so are independent bakeries.
Ms. Huang, the owner of an independent bakery on Yishan Road, said: "The current turnover has only recovered to 20% of the normal level. Since March, it has been losing money for five consecutive months. If things go on like this, it is not ruled out that the store may be closed. But I'm still reluctant."
In June of this year, in order to increase the sales of the store, Ms. Huang also set up a stall and shouted at the entrance of the store in a place closer to the flow of people, because the products are guaranteed to buy only the fresh goods of the day, and they can only be wasted the next day, so I thought Take a little less loss.
At the beginning of June, business was good for a few days, but then sales fell due to the tightening of epidemic prevention measures.
According to Ms. Huang, during the epidemic, the common problems faced by stores renting with non-state-owned landlords are that the rent cannot be reduced or exempted temporarily, and the cash flow on hand is not enough to pay the rent on time.
Now, she is at a standoff with the landlord.
"We were closed for half a month in March, closed from April to May, and were required to close at 7 pm in June, so we hope to be able to waive at least 4 months of rent."
Of course, not all bakeries are at risk of closing.
"Business is very good after returning to normal operations. Although it is not as good as the sales during the winter peak season, it has basically recovered to the sales of the same period last year. Although the epidemic has been greatly affected, I never thought about closing the store." Located in Damu The owner of a Kaisling in Qiaolu told the First Financial Reporter.
There are also some companies that are about to leave.
Even under the high temperature of 40 degrees, there are still an endless stream of guests in the LADY M store.
A reporter from China Business News saw at the scene that LADY M’s store is not big, and there are sliced cakes of various flavors placed in the glass freezer. Even on normal working days, there are still a large number of customers queuing up to buy, many of which are small takeaways. Brother, some younger brothers will run into the store and take away a few big bags against the clock.
The first financial reporter bought a sliced cake. The unit price is 75 yuan, which is really not cheap. The taste is actually not very different from ordinary cakes.
Some consumers revealed that when business is better, plus purchasing fees, the price of a piece of LADY M cake can reach about 100 yuan, and people are still rushing.
Although the business is so hot, LADY M is about to close all existing stores in the Chinese mainland market, and there are also signs indicating the closure of stores in its stores.
In the recent business flow, it is estimated that many customers have to use up the balance of the prepaid card before closing the store.
LADY M is one of the representatives of Internet celebrity brands in the baking industry in recent years. In fact, the updating and iteration of the baking industry has been in progress.
BUTTERFUL & CREAMOROUS Butter and Bread (hereinafter referred to as B&C), Hutou Bureau · Standard Chartered Cake, O'mills Bakery&Bistro, PAIN CHAUD Baiqiu, Mizhilin and KUMO KUMO Cheesecake and other Internet celebrity brands emerge one after another, and even new teas such as Lele Tea The drink brand also started to make bakery products to seize the market.
In addition, established baking brands such as Christine, 85°C, Yizhiduo, BreadTalk, Kesling, Ruby, Yuanzu Foods, etc., made the "baked rivers and lakes" very lively, and the "involution war" also began.
What does the Internet celebrity bake roll look like?
As a food, the first thing in baking is of course the taste.
According to the statistics of DT Finance, a subsidiary of China Business News, judging from the TOP3 recommended dishes of 100 popular Internet celebrity bakeries, the raw materials of bakery products are becoming more and more convoluted.
If the brand store does not have a few cakes that can be obtained, they will be embarrassed to mix up on the food and beverage list.
For example, Ribone Café's lemon cake, soy custard cake with small cube sweetbox dessert, and WenTinG's yogurt strawberry cake specializing in birthday cakes, KUMO KUMO cheese cake's cheese cake, DOUX RêVE's Vanilla Sea Salt Naked Cake and more.
In addition, mochi, cheese, chocolate, sea salt, milk and other raw materials are also frequent customers of Internet celebrity baking.
For example, the signature of Hutou Bureau Standard Chartered Cake is the "three-piece mochi set": meat floss mochi tiger roll, QQ raisin mochi and double-layer mochi plate tart.
In addition, Internet celebrity cake shops are very capable of capturing the mentality of young people - they can't afford Hermes, but they can buy Hermes in cakes.
As a result, there has been a trend of adding some high-end ingredients to bakery products.
Statistics from DT Finance, a subsidiary of China Business News, found that Wellington steak, as a common dish in high-end Western food menus, is generally expensive.
On the public comment list of Wellington steaks, almost all are close to one thousand yuan.
As a result, some bakers have launched a "low-profile" version of Wellington, such as the Wellington Steak Bun from Guanglian Shen Dim Sum Park, the Wellington Croissant with prunes from HOTCRUSH, and the original Wellington Steak Croissant from B&C.
Steaks that originally cost 1,000 yuan to eat can now be eaten with the same bread for tens of yuan. This somewhat satisfies the mentality of some young consumers, and it is also one of the secrets of these Internet celebrity bakeries "overtaking on curves" one.
In addition to ingredients and taste, bakers' "inner rolls" are also reflected in site selection.
For the baking industry, which is very dependent on the flow of people, a good location basically means more than half of the success.
Taking Shanghai as the scope of investigation, DT Financial Data, a subsidiary of CBN, collected the TOP100 shops on the popular list of Dianping’s bakery and desserts. Almost all Internet celebrity bakeries are located in several core areas of Shanghai’s inner ring, and Jing’an District and Huangpu District together are almost It accounts for half of it, and many stores such as B&C, Hutou Bureau and Standard Chartered Bakery, which are extremely popular recently, are concentrated in the above two areas.
In addition, there are some new dark horses, such as HOTCRUSH, Sawada Honka and Dorayaki, etc., which have entered Pudong New Area and Hongkou District.
Nanjing West Road is mainly distributed in the prosperous core areas such as Fengshengli and Wujiang Road.
Among them, there are also "ace players" Guanglianshen Dim Sum Park that has appeared in Jing'an Temple.
Huaihai Road, People's Square/Nanjing Road, Xintiandi and other areas in Huangpu District are also the battlegrounds for Internet celebrity brands, which highly overlap with the brands in Jing'an area.
But it is worth mentioning that Huangpu District has been the first choice for international players for many times. For example, B&C's first store in Shanghai and LENÔTRE's first store in China are both in Xintiandi.
Internet celebrity bakeries are vying for location.
In order to attract attention, bakery names and packaging bag designs have also reached new heights.
Except for some overseas online celebrity branches, more than 80% of the names on the list are in English or a mixture of Chinese and English, such as Jufu Shanghailander, la Boulangerie Bakery, DRUNK Baker... Now, with the rise of the national tide, Hutou Bureau·Standard Chartered Brands such as Cake Shop, which are very “national trendy” from name to product to packaging, also broke through the siege.
In terms of price, there is a big difference.
Statistics from DT Finance, a subsidiary of China Business News, found that more than 40% of Internet celebrity bakeries are below 50 yuan per capita, and nearly 80% are below 80 yuan per capita.
Among them, Dusushijia, Fufu Cake Shop, Gold Medal Pineapple Bun, Hong Jiugong and others are even less than 30 yuan per capita.
But there are also mid-to-high-end prices like LADY M, which are nearly 100 yuan per capita.
There are also some brands whose prices are unusually high. There are 6 brands with an average price of more than 200 yuan, including the full reservation system, Maggie Y, Laderach, which is known as the "ceiling" of magic chocolate, Huff DOUX RêVE, and The crossover players Polux by Paul Pairet and salée, whose desserts are more out of the circle than the meals.
There are two stores on the list of DOUX RêVE, the highest one is even more than 400 yuan.
The store's main birthday cakes are almost 800 yuan for 6 inches, and 1300 yuan for 8 inches. If several layers are stacked, such as the oil painting series of irises, the highest price can be more than 2000 yuan.
Store closings coming?
The low entry barrier makes more and more companies "entering" the baking industry.
According to Tianyancha data, there are nearly 170,000 baking-related enterprises in my country, and nearly 9 are self-employed.
There are more than 160,000 baking-related companies with a registered capital of less than 1 million, accounting for nearly 94%.
From the perspective of regional distribution, Guangdong Province ranked first with more than 36,000 enterprises, accounting for 20%, followed by Shandong and Jiangsu, ranking second and third with more than 20,000 and nearly 14,000 enterprises respectively. .
In the past ten years, the baking track has maintained a rapid growth trend.
In 2016, the number of bakery-related companies exceeded 10,000, and since then it has been rising at an annual growth rate of about 25%.
In 2020, the number of new registrations of baking-related enterprises reached 34,000, which is almost four times that of a decade ago.
As of July 20, 2021, more than 15,000 baking-related enterprises have been established in my country this year.
The "2021 Baking Industry Development Trend Report" released by Youzan and Weiyi also shows that it is precisely because of the low difficulty of entering the baking industry that a large number of small enterprises are pouring in, resulting in extremely fierce competition.
It is difficult for leading companies to form a brand advantage, and the market share of TOP5 companies only accounts for 10.8% of the entire industry.
The baking industry is becoming more and more competitive, and the industry "involution" in the above-mentioned raw materials, location selection, marketing and packaging, etc., makes raw materials, commodity research and development, labor, rental and marketing costs rise.
At the same time, the epidemic has also had an overall impact on the baking industry.
Compared with large-scale restaurants, brick-and-mortar retail, large-scale experiential entertainment and other consumer industries with large investment, bakeries with lower investment thresholds belong to “small boats and good U-turns”. Once there are problems in operation, it is relatively convenient to close the store and stop losses.
So a group of chain baking brands began to close their stores to adjust.
Except for LADY M, which claims to be closed due to agency issues, Christine is suspected of operating abnormally recently, and almost all stores in Shanghai have been suspended.
In this regard, Christine said: "The new crown epidemic since 2020 has brought a heavy blow to Christine's operations, and the Shanghai epidemic in 2022 has brought business development to a standstill. Even so, Christine is still tenacious. Keep adjusting and try to start again.” The financial report shows that Christine’s operating conditions have been poor. From 2013 to 2021, Christine has lost money for nine consecutive years, of which she will return to her mother in 2019, 2020 and 2021. Net profit was -224 million yuan, -110 million yuan, and -170 million yuan respectively.
There are still many old brands facing the dilemma of closing their doors.
In 2020, Marco Polo, a bakery that Shanghai people have eaten for more than 20 years, will also close its store; in 2021, many stores in Yizhi, which used to be everywhere in the subway, will be closed overnight, and the number of remaining stores is very small. .
Also in 2021, the more famous Donghaitang in Guangzhou also announced its closure.
Also, BreadTalk will also withdraw from the Xi'an market in February 2022.
Chinese food industry analyst Zhu Danpeng believes that for China's baking industry, innovation, upgrading and iteration must be the main theme of the development of the entire industry.
The closure of some old brands is not only related to the epidemic, but also to their own lack of innovation, rigid mechanisms, and aging teams.
Continuous financing, is it sustainable?
Although the industry is involved in the industry, according to the statistics of Tianyancha, the development trends such as high degree of standardization and huge scale chain potential have made new Chinese baking a hot track for food and beverage investment in recent years. In 2021, there will be more than 10 financing events in this field. Since then, the total financing amount has reached more than 2 billion yuan.
For example, since 2021, emerging baking brands such as Huanniu Cake House, Hutou Bureau, Momo Dim Sum Bureau, and Happiness Cake have successively obtained financing.
However, the sustainable development of emerging bakery brands remains to be studied.
The Everbright Securities report shows that the follow-up expansion of emerging bakery brands needs to continue to verify the replicability of stores, and needs to continue to update and iterate to maintain product strength.
The low-investment and popular strategy of emerging bakery stores is conducive to optimizing the single store model, but the key to subsequent expansion is whether to enhance the replicability of stores through standardization. At present, most of the stores of emerging bakery brands are more concentrated in the first-line and new-line The city is still in its early stages of external expansion.
At the same time, the technical barriers and entry barriers of these baked goods are relatively low, and the homogenization competition is more serious. In addition, the consumer groups are mainly young people, and their taste preferences change rapidly. Brands need to continuously update and iterate products.
The "2022 Baking Category Development Report" released by Meituan Restaurant also mentioned that in comparison with the popular category of milk tea, the consumption stickiness of baking is obviously insufficient.
The temporary "delicious, good-looking and fun" can only attract the enthusiasm of young people for a while. Whether it is the current young people or any generation of young people, there is no "taste bud loyalty" to speak of, and the ability to keep up with the trend of product iteration and cultural precipitation can only is the key to continuing to attract their enthusiasm.
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