Author丨Wu Chaofan
Editor丨Tangerine
Behind the large-scale closure of stores, it is not only the performance of the acceleration of the involution of new tea drinks, but also related to the company's own strategic choice and blind upgrade.
Although the current predicament of Shuyi Burning Fairy Grass is simply attributed to the brand upgrade or being too one-sided, it is undeniable that in the eyes of the outside world, the transformation of Shuyi Burning Fairy Grass did start from the upgrading of the brand in 2022......
Swap cards to get a new life
Back in 2007, the milk tea industry was still in a period of savage growth, and many of the leading figures in the industry had not yet appeared on the stage of history.
Zhang Junjie, the founder of Bawang Tea, is still wandering, and Wang Yunan, the founder of Gu Ming, is still doing business in college; Nie Yunchen, the founder of Heytea, is still in college. In that year, Mixue Bingcheng, which is now the largest store in terms of store size, changed its name from Hallyu Shaved Ice to Mixue Bingcheng and began to explore chain management.
Shuyi Burning Fairy Grass, which once ranked second in store size, was established in 2007, but at that time, it was not called Shuyi Burning Fairy Grass.
On December 1, 2007, Wang Bin, who had just graduated from university, bought a K77 train ticket with 10,000 yuan and came to Chengdu to open a store in Changsha with the idea of "earning more money than working".
Wang Bin, who just graduated from college, is not as able to make hundreds of thousands of dollars in business in college like Wang Yunan, nor does he have Zhang Junjie's many years of social experience, but relying on the capital and courage given by his parents, he still opened a shop called Taipei Milk Tea on Honghe Banbian Street of Sichuan Normal University.
When the store first opened, Wang Bin's business did not improve much. "The business is not good, it can only be said that it is barely maintained or has a small profit."
In order to find the reason, Wang Bin continued to investigate, and he found that although Taipei milk tea borrowed the name of Taiwan milk tea that was popular at that time, it did not have unique recognition, and the product did not have characteristics.
For some reason, Wang Bin decided to change the name of his bubble tea shop to 85°Tea, which is highly similar to the well-known baking brand 85°C.
During the renaming and closure of the store, Wang Bin also upgraded the product, and after searching for Tiannan and Haibei, he found that the locals in Guangdong and Fujian would eat a snack called roasted fairy grass, and would use sugar buffalo milk and other ingredients to match. This snack has a unique taste and has the effect of cooling and relieving the heat.
This inspired him to think that Sichuan people love to eat hot pot, and if it is served with roasted fairy grass, it should be very popular. So, he began to focus on burning fairy grass. In order to distinguish himself from other bubble tea shops, he even printed the roasted fairy grass monopoly directly on the door.
Perhaps because of the right thighs, or the burning of fairy grass meets the needs of Sichuan people, Wang Bin's milk tea shop ushered in a period of development, but the name change also laid the inducement for future troubles.
Get into a lawsuit
While changing the name, Wang Bin also continued to summarize the experience of his peers and transformed the 85°Tea store to make it more recognizable and more attractive to consumers. Wang Bin believes that by constantly transforming stores, it is gathering offline traffic.
During this period, he also brought his relatives and friends to work together, and by the end of the following year, 85°tea had 10 chain stores.
The first brand upgrade did bring good luck to Wang Bin. 85°Tea chose to open up franchise in 2010 and officially entered the country in 2011. In the era when milk tea brands had not yet been chained on a large scale, 85°Tea had 200 stores in 2013, and in the same year, Sichuan Shuyi Catering Management Co., Ltd. was registered and established, and began to gradually move towards corporate operation.
Despite the difficulties in the company's operation after the failure of investment and the failure to open stores in other provinces, Wang Bin finally survived, and 85°Tea stores reached more than 350 in 2016.
While going all the way, Wang Bin got into a lawsuit.
At the end of 2016, 85°C filed a complaint against 85°Tea for infringement. Wang Bin once recalled that he was confused at the time, but after consultation, he found that he really had no chance of winning, so he had to decide to change his name.
But changing the name is not simple, it involves consumers' recognition and recognition of the brand.
After thinking about it, Wang Bin remembered that consumers often say to their peers, "I'm waiting for you in front of the burnt fairy grass." This gave him inspiration, since he is mainly engaged in burning fairy grass, consumers have a strong understanding of burning fairy grass, so he might as well associate it with burning fairy grass.
As a result, Shuyi Burning Fairy Grass came into being in 2017.
After a name change and a second brand refresh, the book did run faster. By the end of 2017, the number of Shuyi stores reached 500.
And this point in time is also the eve of the rise of the milk tea industry. At that time, various brands emerged in an endless stream, and milk tea also began to collectively move towards the era of chaining. At the same time, the various categories of milk tea have gradually expanded. Poplar manna was cupped, lemon tea became a category, yogurt also became another base for milk tea, and raw leaf tea gradually became popular.
Major brands also appeared on the stage in 2017, Bawang Chaji was established in that year, Chayan Yuese became popular on the Internet, Nai Xue's tea began to expand from Guangdong, and Mixue Bingcheng began to go to Southeast Asia.
Relevant data show that in 2017, the growth rate of the milk tea industry reached 60%, and 180,000 new stores were opened. No matter how you look at it, 2017 is indeed of great significance to the milk tea industry.
It was also during this period that Shuyi Burning Fairy Grass ushered in the rapid expansion of stores, with the number of Shuyi stores increasing to more than 1,300 in 2018 and more than 3,000 in 2019. In the following years, the rapid growth continued, and in September 2021, the book also announced that the total number of stores exceeded 7,000.
But the transformation also began the following year.
Peaks fall
When the brand grows bigger, it will hope to upgrade its brand through consulting and achieve greater success. For example, after receiving H&H's consulting services, Mixue Bingcheng ran faster and faster. Naturally, other brands of the same kind will also be tempted, and books are one of them. It's just that this brand upgrade did not bring good luck to the book.
In 2022, the book also changed the decoration style of the store to a grass-green visual effect, and added a red rabbit. In fact, this kind of promotion has not been recognized by the majority of franchisees. At that time, many franchisees did not change their stores, which led to the existence of a large number of new and old style stores at the same time. Some consumers even think that the new store is a pirated brand and no longer consume it.
Not only the decoration of the store, but also the book also gave up its flagship product - burnt fairy grass, and began to shift from "half a cup is a material" to the "plant-based new tea drink" market. Wang Bin believes that burnt fairy grass is also a plant-based new tea drink, and in April 2022, the product was completely transformed. But the market didn't buy it, and amid a large number of consumer complaints, the book gradually went downhill.
Although, in 2022, the book also received a financing of 600 million yuan, but this money did not bring more changes to them.
Moreover, as the new tea drink becomes more and more involuted, the price is getting lower and lower, and brands in the industry have to join. Starting from April 2024, the book will continue to reduce the price of its products, and the prices of many new fruit and tea products launched are around 10 yuan, which is 3-6 yuan lower than the previous menu price, and the average price of the product has dropped from about 15 yuan to 10 yuan.
But for franchisees, this is tantamount to a critical hit. "The product itself is not easy to sell, and the price reduction has lowered the profit margin. The products are even more messy, and the products suitable for summer are pushed in winter, and the products that are easy to sell are taken off the shelves at every turn. The store that has been changed for a short time will be changed back in April this year, and I don't know what the people at the headquarters are thinking. Some franchisees complained.
After repeated jumps, Shuyi's stores began to usher in large-scale closures, closing more than 1,000 stores in a short period of time. Although Shu also said, "This is based on the new market situation, Shu also optimizes stores and business adjustments, shifts from opening more stores to opening good stores, focuses on the sinking market, focuses on product structure adjustment and single-store model optimization, supports franchisees to make steady progress, and improves the revenue and profitability of stores and single stores." ”
But in reality, even an outsider can see that something is wrong with the book. A former employee of Shuyi said, "Recently, the director of Shuyi has changed several waves, the entire R&D line has been cut, and all departments are changing. Even the person in charge of investment promotion is sending news about the transfer of the store. ”
Recalling the time when the name was changed from 85° Tea to Shuyi Burning Fairy Grass many years ago, Wang Bin called it "the darkness before dawn". And this brand upgrade doesn't seem to have brought him light. I don't know if Shuyi will survive the darkness and usher in the dawn this time.