In the second half of the Internet, where is the growth point for catering companies?

At the FBIC2020 Global Food and Beverage Innovation Conference, Bai Xiufeng, dean of Meituan Takeaway Academy, shared 6 trends in the development of the catering industry after the epidemic.

01

The first half depends on dividends, and the second half depends on capabilities

If we take the epidemic as a node, it is the "cutting line" between the first and second half of the catering industry. Before this, the Chinese economy has experienced 4 waves of dividends:

The first wave: joining the WTO;

The second wave: real estate economy;

The third wave: Internet economy;

The fourth wave: service industry economy with consumption upgrades and expanded domestic demand.

Before 2012, it was a period of high consumption for all people; in addition, before 2016, China's catering industry had obtained dividends brought by the rapid development of shopping malls, such as Xibei and Waipojia;

At present, we are in an environment of oversupply of consumer goods and consumption upgrades. At the level of Internet upgrades, we need to use new thinking and methodology to do the catering industry again.

So, what capabilities do we need in the second half?

I think the following four capabilities are needed:

First, demand insight capability.

First, for consumers who are mainly born in the 1990s and 2000s, can we deeply understand their needs? If not, we may not be able to catch up with this wave of consumption mainstream in the next ten years.

In addition, the overall needs of young people will also change, which will be very different from those born in the 1970s and 1980s.

The biggest difference is that they were born and grew up with the Internet. They are natural "Internet natives", so their consumption patterns and consumption habits are different from those born in the 1970s and 1980s.

Second, supply chain capabilities.

Whether it is dine-in or take-out, the core is our ability to control the supply chain. Recently, I have been thinking that the links related to catering and food are finally doing retail - all based on strong back-end supply chain support, the store may be just a small experience point, and all the links in the middle are omitted.

Third, digital operation capabilities.

At present, we have entered the digital age. The application effect of all digital links is ultimately reflected in cost and profit.

Previously, the catering industry was developing in an extensive manner. Because of the support of dividends, it "ran very fast" and did not care about the cost of 3-5 workers. However, in the future, the catering industry must control all costs to the minimum. The view of Wu Guoping, the founder of Waipojia, is that stores should be able to control costs in the future, and do not use 3 people to do what 2 people can do.

Fourth, organizational development capabilities.

Many catering colleagues asked whether to open branches or franchise chains?

I said that whether to open branches or franchise chains, the core lies in whether the organizational capabilities can overflow. If the organization does not have overflow capabilities, franchising is a lie.

In the future, organizational capabilities will be the core capabilities of corporate development.

02

The first half depends on products, and the second half depends on experience

It is not that products are not important, but that products are just standard, and what is more important is experience.

I have summarized a methodology called "three layers and two sides". The so-called two sides are "internal affairs and external affairs".

Many companies are studying user experience, but they are not clear about how to improve user experience. In particular, many friends in the catering industry said that we have been engaged in catering and service, we are extremely attentive to service, we work very hard, but we cannot get recognition from customers.

According to my theory, I think that everything these friends in the catering industry do is their job, such as serving dishes, pouring water, wiping and arranging dishes. These are the job of catering practitioners for users, and no matter how well they do, they will not receive more praise.

However, if they do not do well, they will definitely get bad reviews. And if they do extra things a little bit well, they will get good reviews, because this is beyond the user's expectations.

For example, when we go to "Haidilao" to eat hot pot, we did not expect to enjoy manicure services, order snacks, and give half a watermelon when we leave the store. These are all things beyond the customer's expectations.

The key is that we can clearly identify which are our job and which are extra things? Do your job well and do extra things well. No matter how well and fully you do your job, it only meets the needs of users.

Now, we are used to the way of consumption on the Internet. In the future, there will be more and more offline physical store consumption, and the essence of consumption in physical stores is to hope for a better experience.

Consumers' expectations for online and offline consumption are no longer just the separation of prices. Consumers' cognition and demand for experience are becoming stronger and stronger. Consumers go offline to buy things starting from the desire to get a better experience.

In recent years, the "peak-end rule" has become popular again. IKEA's overall consumer experience is divided into many touch points, and the same is true for Starbucks' consumer experience. Some links have a good experience, and some links are not.

For example, the customer experience is not good when you need to queue up for coffee at Starbucks. Starbucks will not let customers sit down and then let the waiter serve the coffee to the customer.

In the "standard specification", the waiter should give the coffee to the customer with a smile, but many waitresses do not smile at customers.

The same is true for Disney, so the last link must be fireworks.

Because visiting Disney is a very hard thing, in order to leave customers with a good impression of Disney, a firework is set off when the customer leaves the park, and at that moment the customer will feel "worth it".

The catering industry is divided into about 22 touchpoints. The store connects with customers the moment the user enters the store. For example, in recent years, employees of the "consulting faction" have begun to promote the creation of store signs.

Let's look at Haidilao again. All Haidilao takeouts will be given mouthwash. In the past, chewing gum was given, but now it is very low-end because many hot pot restaurants are using it.

03

The first half depends on traffic, and the second half depends on retention

We know a formula: sales = traffic × conversion rate × repurchase × customer unit price.

It is difficult to increase traffic. During the epidemic, online and offline traffic were basically stagnant;

The conversion rate depends on the influence of the brand;

The customer unit price is basically unchangeable;

In terms of repurchase rate, as long as the various factors are combined well, it is what we call retention rate. The most important thing is to improve the retention rate.

04

First half depends on speed, second half depends on quality

"Fast" and "good" belong to two different core logics. In the past, China's economy developed rapidly, and the Internet industry was the same. Whoever was faster could occupy the territory. Today, "speed" alone is no longer enough.

So, how to do better?

Organizational ability, supply chain ability, and Internet ability can all help us build a good brand.

05

In the first half, we did marketing based on digitalization, and in the second half, we controlled costs based on digitalization

I think marketing must be done, but we must also recognize the current situation.

Low gross profit margins in the catering industry are the norm. Putting aside the epidemic, many people have been saying that the catering industry is not easy to do now. In fact, it is because the catering industry used to be too easy to do business.

In fact, there are few industries that have such high gross profits as catering. Everyone thinks that gross profits below 65% are very low.

However, now the gross profit margin of the catering industry has suddenly dropped below 60%, and even when it reaches 55%, everyone feels that it is not profitable.

Compared with developed countries such as Japan, the net profit margin may be maintained at around 5% for a long time, which has actually outperformed many other industries.

How is this done?

Rely on cost control - use high-tech means to improve labor efficiency and reduce labor costs.

"Data productivity" is a necessary path to control costs. Only by "dataizing" everything can we make data productive.

06

Foodization of catering

A unique phenomenon after the epidemic - foodization of catering.

Food will definitely be more refined in the future.

"Adding a dish to the table through takeout" is a scenario. A person can just order a bento to solve the problem of food and clothing.

The place with the largest takeout volume is the community rather than the office building, mainly people who go home after get off work and stay at home.

I personally like "A Duck at Grandma's House". It costs less to order a duck than to cook a duck at home, and the taste of the restaurant must be better than what you cook yourself.

Because restaurants have a rich supply chain behind them, for example, they use Nongfu Spring, Moganshan dried bamboo shoots, Jinhua ham, and the time spent on processing ducks and ingredients. In this way, the time cost of personal cooking is higher than that of restaurants. As the division of labor becomes more and more refined, the time cost also increases.

With takeout, even if friends come to treat us, there is no problem. I think this is a new change that takeout will bring in the future. Takeout is not only to solve the problem of food and clothing, but also to upgrade the quality of our catering supply and demand. I think this is "catering food".

In addition, takeout solves the contradiction between cooking at home and time cost. During the epidemic, many people cooked at home, and we are used to or enjoy the "family satisfaction" of eating at home. However, there may be situations where you don't want to do it.

For example, before getting off work, we ordered a takeout, and the meal was cooked when the takeout guy delivered it to our home. We made two cold dishes at home and packed them up to the company the next day. This is the way many young people do now.