Edit |Yuer Lake
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The once fragrant "milk tea" business is getting worse and worse, and even the former "first stock of milk tea" is a little "unbearable". In the first three quarters of 2023, Xiangpiaopiao's report card not only "increased revenue but not profits", but also the net cash flow generated by operating activities was negative, down 105% year-on-year.
The poor performance of many core data of Xiangpiaopiao is enough to show that this former "potential stock" of milk tea is coming off the altar.
The cash-burning strategy no longer works, and the increase in revenue does not increase profits
In the first three quarters of 2023, Xiangpiaopiao's cumulative revenue was 197.9 billion yuan, a year-on-year increase of **2931%；The net profit attributable to the parent company is only 348390,000 yuan, and since 2023, the company has received a subsidy of 481960,000 yuan, after deducting such non-recurring gains and losses, the net loss reached 40.25 million yuan; Net cash flow from operating activities was -14.88 million yuan, down 105% year-on-year. Xiang Piaopiao said that this is mainly related to increasing advertising and marketing costs.
Despite putting aside the ** subsidy, Xiang Piaopiao has achieved a turnaround. However, the growth of its revenue and net profit is not proportional, which may indicate that the premium of today's Xiangpiaopiao brand is still very limited, and it is even relying on "burning money" to maintain the scale of sales.
Actually, Xiang Piaopiao's explanation is reasonable. According to its financial report data, although Xiangpiaopiao's total revenue increased by nearly 30% in the first three quarters, its sales expenses also rose, and even far exceeded its revenue growth level. The data shows that compared to 67.1 billion yuan, and the total revenue of Xiangpiaopiao in the third quarter of 2023 increased by 1$3.7 billion to $80.8 billion yuan.
At the same time, total operating costs also increased from 61.2 billion yuan, a year-on-year increase of 2446% to 76.1 billion yuan, an increase of 14.9 billion yuan. Of all costs, selling expenses have increased even more dramatically, more than doubling year-on-year.
In the following quarters, Xiangpiaopiao's sales expenses also showed a significant upward trend, and the financial situation of "increasing revenue without increasing profits" may continue.
It is understood that Xiang Piaopiao is not only "willing" to spend money on the promotion of milk tea products, but also very "generous" in its expansion of the instant beverage category, for example, the core products in the instant beverage category are MECO juice tea, Lanfangyuan bottled frozen lemon tea, and Xiang Piaopiao is betting on marketing.
In April 2023, Xiangpiaopiao's MECO Honey Valley invited top star Cai Xukun to endorse it, while Lanfangyuan bottled frozen lemon tea launched a "fierce attack" in the southern and northern markets represented by Guangdong and Beijing, not only increasing the distribution and listing efforts, but also increasing the placement of elevator advertisements and subway advertisements.
It's just that the basic plate of Xiangpiaopiao has been "lost" too much, and these new products may not be able to remedy it. According to the financial reports of Xiang Piaopiao in the past three years, the sales volume of brewing products represented by classic milk tea were 45.59 million boxes, 42.92 million boxes, and 35.18 million boxes respectively, decreasing year by year. Based on the specification of a box of 30 cups, the brewed products of Xiangpiaopiao in 2022 will sell about 2 less than the previous year300 million cups.
In the early years, Xiang Piaopiao's advertising slogan was "The cups that sell milk tea in a year can go around the earth together", which shows that the contribution of the milk tea business in Xiang Piaopiao's performance is self-evident.
With the increase in the cost of the ready-to-drink sector, the personnel expenses of the new ready-to-drink sales team, brand promotion and channel investment are all a large cost. This also means that when its new business has not yet grown, Xiang Piaopiao may continue to be in the dilemma of increasing revenue but not increasing profits.
At the same time, with the diversification of its products, the basic plate formed by its milk tea products is being lost. According to Nielsen data, in 2020, Xiangpiaopiao milk tea's share of China's ready-to-drink milk tea market was only 34%, ranking sixth, far behind the unification.
1. Mengniu, Guangming and other brands.
In 2017, the share of Xiangpiaopiao milk tea in China's ready-to-drink milk tea market reached 96%, ranking second, second only to unity. This means that in just three years, the share of Xiangpiaopiao milk tea in China's ready-to-drink milk tea market has shrunk by nearly six percentage points. And the status of the industry is also shaky.
The problem of aging channels is prominent, and product diversification is difficult to achieve
Compared with other retail brands, the dilemma of Xiangpiaopiao is that its marketing channels are too "old". On the one hand, at a time when new models such as online shopping and intra-city instant retail are becoming mainstream, Xiangpiaopiao's marketing channels are still mainly offline and rely heavily on dealers.
Taking the proportion of dealers' revenue contribution as an example, in the first three quarters, its dealer channel sales reached 172.2 billion yuan, a year-on-year increase of 3043%。Although the sales of self-operated channels have grown rapidly, the overall scale is still small, only 4415330,000 yuan, accounting for only 2 of total sales26%。
Therefore, industry professionals believe that the way to break through the performance growth dilemma of Xiangpiaopiao may need to be completely changed from the channel aspect. For example, increase the layout of online channels, pay attention to the investment in grass planting platforms and short platforms, and gradually increase the proportion of sales in online channels. At the same time, strategies in terms of channels and marketing also need to be stepped up.
Corresponding to the "aging" of the channel, there is also the aging of the brand and the speed of product update. Although, as mentioned above, new products such as Xiangpiaopiao MECO juice tea and Lanfangyuan bottled frozen lemon tea, and also aimed at the snack track, cross-border layout of ice cream and other products, however, the competitive pressure faced by such tracks is also not small.
On the one hand, the snack stores that can be found everywhere in the streets and alleys are becoming Xiangpiaopiao's biggest competitors. Brands such as Snack Youming, Zhao Yiming, and Snack Very Busy have developed rapidly in recent years, and they are very fierce in store expansion by virtue of the franchise model. This also means that these strong head players will not give Xiangpiaopiao, a cross-border player, too many opportunities to carve up the market.
On the other hand, the sales of products such as ice cream are seasonal, and the competition in the industry is equally huge. Whether it is the traditional dairy brands Mengniu and Yili, or the cutting-edge Zhongxuegao and the cross-border Moutai, they are all aiming at this track. Therefore, Xiang Piaopiao's opponents are also everywhere. Moreover, Xiang Piaopiao entered the game at this time, and the industry pattern was initially decided, and it seemed too late.
And when it is still difficult for Xiang Piaopiao to maintain its "combat effectiveness" in its base camp in terms of brand power, product power, team execution, etc., how can Xiang Piaopiao wrestle with some old players on a new track?
As the aging problem of Xiangpiaopiao's channel becomes increasingly prominent, the diversified layout of its products has not yet improved, and the confidence of investors in the secondary capital market in its future is also obviously insufficient. As of January 10**, the share price of Xiangpiaopiao was 166 yuan shares, compared with an all-time high of 38 in mid-201940 yuan, has fallen by half.
It can be seen that if Xiang Piaopiao wants to break through the dilemma of performance growth, he may need to find a more effective way out.
Won the opponent and lost to the times
If the market is divided into two halves. Then, the first half of the fragrant fluttering is undoubtedly glamorous. The clock was turned back to 2004, when it was in the blank period of the milk tea market, and it was also a dividend period for the surge of industry players.
Xiang Piaopiao was able to quickly win by scale and go public as the "first stock of milk tea", outperforming many competitors, which was also very successful. Helplessly, with the changes of the times, the industry has also experienced rounds of market reshuffle. In the past, Xiangpiaopiao, who became a leader in the industry by "brewing milk tea", has gradually been "abandoned" by the times. The fundamental reason is that the new tea drink, which is characterized by instant drinking, is becoming a substitute for "brewed milk tea" and becoming the first choice of young consumers.
To sum up, although Xiangpiaopiao milk tea once defeated the old opponent represented by Youlemei, in recent years, Xiangpiaopiao is suffering from the impact of new tea drinks such as Nai Xue's tea, Hey Tea, and Mixue Bingcheng. At the same time, although Xiang Piaopiao has also begun to lay out the ready-to-drink business, it seems to be slow in terms of market performance, which is quite a defensive battle.
Some people say: The times say goodbye to you, and you won't even say hello. This sentence vividly describes the process of incense from prosperity to decline. Industry insiders also gave almost the same reason for the loss of the basic plate of milk tea and the failure of new products to open "sales", that is, Xiangpiaopiao's self-help measures did not step on the key time point. However, the label of fragrant milk tea has gradually changed from national to holiday gifts, and the consumption characteristics have gradually become seasonal, which has also limited its commercial imagination, and this process is indeed embarrassing.
Lei Jun, the founder of Xiaomi mobile phone, has a famous saying: Standing in the wind, pigs can fly. But once the wind stopped, the pig was the one who fell the hardest. Comparing the first half and the second half of Xiang Piaopiao, this sentence is enough to describe the impact of the current situation on the development of an enterprise. Therefore, it is not so much the second half of Xiangpiaopiao that it lost to its "brewed milk tea" products, but rather to lose to this era.
Conclusion
At the end of December, Xiang Piaopiao issued an announcement on the change of executives, saying that Jiang Jianqi, chairman and general manager, applied for resignation as general manager. At the same time, Xiang Piaopiao also announced that it agreed to appoint Yang Dongyun as the general manager (president) of the company, effective from the date of deliberation and approval of the board of directors, and the term of office will be from the date of deliberation and approval of the board of directors to the date of expiration of the term of the fourth board of directors of the company.
As the founder Jiang Jianqi retreated into the background, the stock price of "the first share of milk tea" Xiang Piaopiao rose to the limit. According to industry insiders, Jiang Jianqi, the founder of Xiangpiaopiao, who is known as the godfather of milk tea, "gave way", or a signal that Xiangpiaopiao accelerated its de-familialization.
It is not difficult to see through the "emotion" released by the secondary capital market that compared with family businesses, the de-familialization of Xiangpiaopiao may bring more confidence to investors. I hope that Xiangpiaopiao, which is accelerating the "de-familyization", can rely on its original industry status to open up the situation and go to the next city in the new market game.