On February 23, the Hong Kong Stock Exchange showed that Sichuan Baicha Baidao Industrial Co., Ltd. (hereinafter referred to as "Chabaidao") updated its listing prospectus.
In August 2023, Chabaidao submitted a listing application to the Hong Kong Stock Exchange.
According to the Hong Kong stock listing rules, the prospectus is valid for 6 months, and enterprises need to update the relevant data and information in the prospectus within 6 months, including financial statements, in a timely manner.
The updated prospectus of Chabaidao disclosed the number of stores in 2023, performance changes, as well as the latest plans for overseas business and coffee brands.
99% of the revenue depends on franchising.
According to Frost & Sullivan's report, in terms of retail sales in 2023, Chabaidao ranks third in China's freshly made tea market, with a market share of 68%。The prospectus pointed out that the total retail sales of tea Baidao stores last year were about 16.9 billion yuan, and a total of 101.6 billion cups of milk tea.
The first Chabaidao store was born in 2008, and by the end of 2023, it has opened 7,801 stores, of which more than 99% are franchised stores, and only 6 are directly operated stores.
Photo by Water Hibiscus. Combined with performance, more than 99% of the company's revenue comes from franchise business.
From 2021 to 2023, Chabaidao will achieve revenue of 364.4 billion yuan, 423.2 billion yuan, 570.4 billion yuan, the growth rate during the period was. 8%。
It is worth noting that the franchise fee only accounts for 4 percent of the company's revenue1%, and its main revenue (accounting for 95%) is the sale of goods and equipment to franchise stores, including dairy products, tea and fruits and other materials and ingredients for making tea, as well as packaging materials such as straws and cups and store equipment. The revenue from tea sales, takeaway platform operation and management services of the six directly-operated stores only accounted for 0 percent of the total revenue9%。
The prospectus pointed out that the high dependence on the franchisee model has certain risks, and the ability of franchisees to operate stores will greatly affect the company's performance. The company also said that the current competition in the ready-made milk tea industry is very fierce, and it may be difficult to grow in the future.
Although relying on franchises to achieve store expansion has led to performance growth, the profitability of tea Baidao stores is declining.
In 2023, the average retail sales per store of Chabaidao will be 23880,000 yuan, with an average daily retail sales of 6,887 per store2 yuan, the average sales volume of each store is 14350,000 cups. Two years ago, its average retail sales per store were 27280,000 yuan, with an average daily retail sales of 7,414 per store1 yuan, the average sales volume of each store is 16320,000 cups, with retail sales and average sales in stores falling by more than 12% in two years.
Positioned as a mid-range tea drink, the order applet shows that most products are concentrated between 10-18 yuan, and the pure tea series is priced from 6 yuan.
From the perspective of the distribution of store cities, the new first-tier cities have always been its "main battlefield", 2023, 269% of the tea Baidao stores are located here.
Fourth-tier cities and below, with 1,732 stores (accounting for 22.).2%) grew to become the second largest market in the number of tea stores, an increase of more than 2 percentage points year-on-year. The proportion of tea Baidao stores in second- and third-tier cities is respectively. 4%；First-tier cities have the fewest stores, accounting for only 106%。
Combined with the proportion of turnover in each region, there is a certain gap between the revenue capacity of Chabaidao stores in lower-tier cities or higher-tier cities.
In 2023, Tea Baidao 416% of the stores are located in third- and fourth-tier cities and below, but these cities only account for 34 percent of the revenue6%；The proportion is only 106% of stores in first-tier cities achieved 169% revenue; Stores in new first-tier cities accounted for 269%, revenue accounted for 289%。
It is planned to establish an overseas ** chain.
Since the first submission of the prospectus in August 2023, there have been two changes that are noteworthy.
First of all, Chabaidao disclosed its overseas progress and follow-up planning, and its first overseas store has landed in Seoul, South Korea in January, and will enhance the ability of overseas ** chain in the future.
Cha Baidao plans to start establishing a first-chain system covering Southeast Asian markets such as Thailand, Vietnam and Malaysia this year, and plans to start setting up a distribution center in 2025 to support expansion in the Southeast Asian market.
According to Frost & Sullivan's report, the market size of freshly made tea shops in Southeast Asia will be 32.9 billion yuan in 2023 and is expected to increase to 78.3 billion yuan in 2028.
In addition, the first directly-operated store of Chabaidao's coffee sub-brand "Coffee Ash" landed in Chengdu and officially opened in January.
The reporter inquired about the coffee ash order applet and found that the bakery products in the menu bar are more "eye-catching" for different coffee brands such as Starbucks and Luckin, including hamburgers, bagels, toast, bread and scones, with a total of 14 SKUs; There are a total of 15 coffee drinks, except for the American, the rest of the products are priced at 18-27 yuan; In addition, there are 4 non-coffee items.
From this point of view, the pricing of coffee ash coffee drinks is higher than that of Luckin, which is relatively similar to manner; The product planning of heavy roasting is similar to that of Tims Tianhao Coffee, but the pricing of its bakery products is slightly higher than that of Tims.
In the prospectus, Chabaidao disclosed the future plan of the coffee brand.
In the next three years, 15 coffee shops will be opened in some cities, depending on market demand and business development strategies. At present, the growth model is designed to be implemented in stages, and this year it plans to focus on the establishment and promotion of the coffee ash brand; In 2025 and 2026, it is planned to start laying a franchise store network and establishing a first-chain system.
According to the data of Narrow Door Restaurant, as of February 1, 2024, Chabaidao ranks third among ready-made tea brands with a total of 8,123 stores.
It is worth mentioning that at present, the top four tea brands in the total number of stores in China are Mixue Bingcheng (28,322), Gu Ming (9,132), Tea Baidao (8,123), and Shanghai Auntie (7,716).