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Written by Zinc Finance, written by Chen Yan, edited by Gale Gale.Cudi forced the store to sell alcohol, and finally there was a response.
Recently, Cudi Coffee publicly responded that the orders of Moutai Bulao Liquor (Hua Zhijiu) and Maotan Liquor (Gu Zhihuan) are consistent with the daily orders of the store, and the first batch of orders will be one case for each of the two wines, without deducting the payment, and the payment will be settled on April 30, and the unsold part of the company will be recovered. The deducted store will complete the refund to the store balance account on January 22.
In other words, Cudi admitted that he had previously allocated liquor to each store, but said that this matter was not mandatory.
The reason for the incident is that some time ago, many affiliates spoke out on social **, saying that Cudi Coffee "mandated all affiliate stores to order alcohol" and "a large number of stores have received deduction information".
In fact, in the past year, franchisees have long had deep grievances against Cudi's various riotous operations. In their opinion, the management and control ability of the Cudi ** chain is seriously insufficient, the coffee is not sold well, and now they still have to sell liquor, which is completely unprofessional. In disappointment, there are not a few franchisees who have left.
From the frenzied opening of the store to the stall of expansion, it only took Cudi more than a year. In 2024, stabilizing franchisees and really doing a good job in the coffee business may become Cudi's top priority.
If Luckin sells soy sauce latte, it can be regarded as a cross-border co-branding within a reasonable range, and Cudi's wave of selling exclusive Moutai health wine directly in the store is really too big.
According to the information of the franchisee on social **, the first batch of two boxes of wine in Cudi, a box of 6 bottles, a total of 3,360 yuan, the purchase price of each bottle of wine is 280 yuan, and the current price of each bottle on the Cudi mini program is 599 yuan, which seems to have a good profit margin.
Screenshot of Xiaohongshu.
But the question is, can a bottle of 599 yuan be sold?Not to mention that there are two groups of people who drink liquor and coffeeFrom the perspective of liquor itself, although the Moutai health liquor cooperated with Cudi this time, although it is under the banner of Kweichow Moutai Distillery, there has always been a controversy about Moutai's "labeled liquor", and the recognition in the market is not too high.
Zinc Finance found that in the official *** of Moutai health liquor, the best sales volume is Taiyuan liquor priced at 156 yuan, with a monthly sales of more than 600 pieces, and other liquors in the store with a price of more than 400 yuan have a monthly sales of 0 pieces. It also shows that the brand's consumers prefer products from 100 yuan to 200 yuan.
Now Cudi directly distributes wine with a price of up to 600 yuan, but it is just passing on the sales pressure to the franchisees, so that they can rely on their own abilities, which will make the already difficult store worse.
Screenshot of Cudi Mini Program.
A few days ago, at the joint venture meeting, Cudi also upgraded the operating rules, the new raw materials will be uniformly pushed by the headquarters, and the store will determine or adjust within two hours, which is called to ensure the consistency of the products sold in the store. However, the reality is that many franchisees have reported on the Internet that Cudi has strongly intervened in the distribution, and the franchisees have lost their autonomy in financial expenditure, and the loss has increased.
Seeing that more and more franchisees are going down**, Cudi had to urgently withdraw the new regulations and suspend the implementation in order to calm the public anger.
It's a pity that the accelerated departure of franchisees seems to be an irreversible reality.
According to the statistics of "Restaurant Boss Internal Reference", Cudi's store growth rate has slowed down significantly since September last year, and by the end of the month, it has fallen back to the brand start-up period. While the number of new stores is decreasing, the number of store closures is increasing. According to the data on the official website of Jihai Brand Monitoring, Cudi Coffee only monitored the number of closed stores in the period from October 22 to November 30.
Given that the rent of most shops will be limited to half a year or a year, and after the lease expires, there may be some loss-making franchisees who choose to "close their doors", then there may be a new wave of store closures in the first half of 2024.
Cudi has a "lose-lose" situation with its franchisees, which exposes more of its tight cash flow problem.
In fact, as early as June last year, there was a report that Cudi's cash flow situation may not be optimistic, and it has begun to settle with ** merchants through bank acceptance bills. At that time, a person familiar with the matter revealed that the settlement cycle of Cudi to the ** merchant is 45 days, and if the acceptance bill is true, according to the 6-month acceptance bill, the equivalent account period will be extended to 225 days.
During the same period, a wholly-owned subsidiary of Cudi Coffee was revealed to be included in the list of abnormal operations, and Lu Zhenyao was associated with a total of four pieces of information on persons subject to execution, with a total amount of more than 2 billion. Some time ago, Lu Zhengyao added another piece of information on the person subject to execution, the execution target 781780,000 yuan.
Screenshot of China's Enforcement Information Disclosure Network.
In essence, Cudi's business form is not healthy enough, and it is sinking deeper and deeper into the quagmire of "burning money".
For a long time, Cudi has been obsessed with doing two things, one is to rely on the low-price strategy to fight the subsidy war, win consumers, and create voice; The second is to use the appearance of prosperity to attract more associates to join and maintain the speed of market development. According to the investment promotion research report, only the two expenses of marketing promotion and franchisee subsidies, Cudi will invest 4-600 million yuan in the first half of 2023.
In this process, Cudi has not been favored by capital, and so far, not a single financing has been completed. From the perspective of the investment environment, Cudi failed to catch up with the "good times" of Luckin, unlike around 2019, when a large amount of US dollar capital poured into the consumption track, at present, global investment institutions are invariably tightening their money bags, and investors are becoming more cautious.
What's more, although Cudi's founding team calls itself the "former founding team of Luckin", Luckin's current success has little to do with them. The more accurate title of Lu Zhengyao's team should be the "former Luckin financial fraud team", and there is a lot of black material in the capital market, and Cudi has little hope of winning the favor of capital.
To a certain extent, Cudi is in a dilemma.
On the one hand, Cudi, which lacks capital transfusion, has to absorb the funds of franchisees by expanding stores, fill the hole in cash flow, and support it to continue to fight the subsidy warBut on the other hand, it is undoubtedly a drop in the bucket to supply the existing more than 7,000 stores only with the funds brought by the hundreds of new stores added in recent months.
Taking a long-term view, franchisee dissatisfaction and cash flow pressure are actually not Cudi's biggest crisis. In the fierce competition of the coffee track, the final competition is the ability of the first chain, and this is the weakest link of Cudi at present.
Since last year, "out of stock" has almost become the norm in Cudi. Not long ago, a Cudi franchisee posted a "Another Letter to the Management of Cudi Coffee Company" on social **, which first mentioned the supply problem.
Screenshot of Xiaohongshu.
The franchisee pointed out that the Cudi ** chain is seriously disjointed, whether it is daily raw materials or materials, it has been in an irregular state of out-of-stock for a long time, "from the most demanded milk coconut milk to some thick milk that is not used much, and even the packaging materials are not accidentally stockpiled, they will not be ordered for a month, and the material arrival date is always one day later than the order is placed, forcing you to urgently order and add delivery fees." ”
It's not that Cudi doesn't know the problems on the chain, and it has begun to draw the pie of the chain. In July last year, Cudi Coffee's East China ** Chain Base was officially unveiled and settled in Dangtu County, Ma'anshan City, Anhui Province. At that time, it was said that it was put into operation in the second half of last year, and the annual production capacity is expected to be 450,000 tons, it will become the largest single coffee roasting plant in China.
As a result, Li Yingbo, chief strategy officer of Cudi, changed his tune and said that the Tuhua East ** chain base will be put into operation in early 2024. But as of today, this ** chain base is still in a state of "difficult birth", and it is still unknown when it will be used.
The chain is closely related to product research and development, and if the chain management is not in place, it will definitely affect the speed and taste of subsequent new product development. It is no wonder that the franchisee pointed out in the letter that the R&D team of Cudi pulled across, and the speed of new products was "touching", and it took a long time to release two new products that "change the soup but not the medicine".
Since last year, Cudi Coffee has made its presence felt in the market, and it has also exposed the existing problems. In 2024, Cudi's challenge may be to grab the remaining ammunition and stay in the coffee market.