Go out until the dark, Ruixing Coffee completes the counterattack?

After experiencing extremely dramatic ups and downs, Ruixing Coffee began to run again.

In 2020, Ruixing Coffee was trapped in the financial fraud, and retreated from Nasdaq in the market and fell into the powder list. After experiencing the financial fraud crisis, the "palace fight" of the "palace fight", the collapse of goodwill, supervision and punishment, and investor lawsuit claims, Ruixing once hovered on the edge of the dying. Surprisingly, Ruixing is more popular at the consumer side. Relying on creating a series of marketing strategies such as Coconut Nattail, Jiu Baogan Ailing, and joint coconut trees, it has further established its own market position.

On August 8th, Ruixing Coffee announced the second quarter of this year's financial report, and business data sang high: In the current period, its revenue was 3.298.7 billion yuan, an increase of 72.4%year -on -year; 615 new stores and trading users reached 20.7 million. The net loss was 114.7 million yuan, including a reserve left by a 277 million yuan for the parties to shareholders. If the divestiture of equity incentives, reserve and other factors, Ruixing has achieved net profit in the second quarter.

Ruixing Coffee, who once wanted to make "China Starbucks", has now reached the backwind? In the process of reconstruction on the ruins, what did Rui Xing do right?

Rui Xing's death return to life to achieve adversity growth

Looking back at that year, Ruixing Coffee, who was released to make "China Starbucks", has surpassed Starbucks from the number of stores. Data show that as of July 18 this year, Ruixing had a total of 7,322 stores in China, an increase of more than 11%over the first quarter of this year. As of April 3 this year, Starbucks, the second largest coffee chain in China, has only 5,654 stores in China.

How did Ruixing create myths, how did they fall down the bottom, then reversed against the trend, and even chased the industry leader Starbucks?

From the opening of the first store in October 2017, to the listing of the Nasdaq IPO (the first public offering) in May 2019, Ruixing made the market value of $ 4.25 billion, and it took only 18 months to refresh the world's fastest IPO in the world Record.

Why is the capital market optimistic about Ruixing? First, there is still a large blank in the Chinese coffee market, and Ruixing has unlimited possibilities for the parity market of the target; second, in the eyes of Chinese consumers who are sensitive to price, through burnling subsidies, Rui Xing, who gives consumers in terms of coffee prices, more. popular.

In 2020, the large short Muddy-WaterSresearch (research on muddy water) released a short report of 89 pages, pointing directly to Ruixing data and financial fraud, saying that there are inherent defects in its business model. Faced with such allegations, Rui Xing finally acknowledged financial fraud. In June 2020, Ruixing Coffee, which had just been listed for a year, suspended trading in Nasdaq for a delisting for record.

In December 2020, Ruixing Coffee stated that it had reached a settlement with the US Securities and Exchange Commission (SEC) for some former employees' suspected financial fraud incidents, which was a fine of US $ 187.5 million. Debt reorganization, officially ending the bankruptcy protection procedure as the debtor. Today, Ruixing Coffee has fully resolved the problems left over from history, ending the shock, and returning to normal.

"For enterprises, credibility is crucial." A senior investor told reporters that, on the one hand, a company with a history of counterfeit history requires more effort to establish credibility, on the other hand There are more reputable people or institutions as their shareholders, members of the board of directors, and management.

It is reported that after the turmoil, Ruixing began to adjust internal adjustment, including the reorganization of the core executive team, Lu Zhengyao, the founder of Shenzhou Department, and Guo Jinyi as the chairman and CEO of Ruixing Coffee. On January 27 this year, Dashu Capital announced that the buyer group had completed the acquisition of some shareholders of Ruixing Coffee. From the perspective of the shareholding relationship, Lu Zhengyao's earlier management of Ruixing was completely out.

Xu Yi, an analyst in the financial industry, believes that the complete exit of the Shenzhou Department will make the capital market trust and look forward to Ruixing Coffee.

Can Ruixing return to Nasdaq after death after death? Ping An Securities Analyst Yi Yongjian said in the relevant research report that by studying the conditions and cases and cases of the pink single market, the reconciliation agreement plan of Ruixing's current collective lawsuit still requires the final approval of the US court; ) "The regulatory authorities of China and the United States have not yet reached a consensus on the issue of the audit draft, and uncertain factors still exist.

Return to the product itself, refined operations, turn losses into profits

For two years in the capital market, it does not mean that Ruixing Coffee is silent in consumers.

"There is a Ruixing store downstairs in our company, that is, it is very convenient." White -collar female Long Dandan, who is working in an e -commerce company in Shanghai, told reporters, "Coffee is the" fuel 'of office workers', and it is I just need to consume. I will choose Rui Xing, a low price of a single cup. "

The reporter asked which product was impressed by which product interviewed, and their answers were almost all: "Raw coconut latte."

"I am a coconut enthusiast. Since I got out of the" Sheng Coconut Latte ', I bought a cup every day, and now I turned to coconut cloud latte. "White -collar female Xiaoye working in Beijing believes that" Ruixing's marketing is closer to the marketing closer Young people. Jointly with the coconut tree, hire Gu Ailing to endorse, and launch the Qixi Xixi limited lone frog, etc., Rui Xing seems to have a very 'stalk'. "

It is reported that Ruixing Coffee launched 34 new products in the second quarter, from April to the end of the second quarter, its "coconut cloud latte" products sold more than 24 million cups. In April, Ruixing's official Weibo announced that its explosive item "Shengya Latte" achieved 100 million cups of sales. It can be said that Ruixing was rescued by "raw coconut latte", and even led the trend of "raw coconut". According to media reports, Hainan Island coconut was even snatched by Ruixing's supplier. Constantining new and manufacturing explosive products is a key trick for Ruixing to return to life. When analyzing the reasons for the growth of the second quarter, the co -founder of Ruixing Coffee, the current chairman and CEO Guo Jinyi, said that it stems from continuously launching explosive products, continuous high -speed expansion of stores, and steady increase in trading customers.

In order to turn losses, Ruixing is reforming the original operating strategy. "At first Ruixing's business had problems. The price wars, scale growth, management details, and business models of the number of days have had great problems, resulting in a serious loss." Lai Yang, chief expert of the research base of Beijing International Trade Center, To reporters, "Rui Xing has changed a lot after adjustment, including adjusting the store management model, turning off the loss of losses, and innovative products that are attractive to consumers. The price has advantages, and there is a profitable price space."

Abandoning the original radical and rough expansion mode, Ruixing is changing to refined operations. It is reported that starting in May 2020, Ruixing stopped the original large -scale free drinking activities and turned to refine the traffic of private domains, and the marketing efficiency was significantly improved.

In terms of store opening efficiency, Ruixing began to optimize the layout, closes losses, and has a significant enhancement of business management capabilities. According to Jihai brand monitoring data, the survival rate of Ruixing's new store in 2019 accounted for only 63%of the 12 months, and the indicator of the new store in 2021 increased to 93%, and the closing rate decreased significantly. According to the data of Ping An Securities, the annual efficiency of Ruixing Direct Store reached US $ 7,200/square meter, which is only less than $ 8,100/square meter than Starbucks worldwide. obvious improvement.

Starting advantages, innovation accumulation, brand value, capital strength ... In China's existing grinding coffee industry, Starbucks was the peak of countless brands. Rui Xing, who is upright this year, is approaching.

On August 2nd, Starbucks released the third quarter of the 2022 financial report. Starbucks China revenue was US $ 540 million (about 3.65 billion yuan), a year -on -year fell 40%. Compared with Rui Xing, which is about 3.3 billion yuan in revenue, the gap between the two is less than 400 million yuan.

On August 4th, Wall Street well -known analyst Frisoalenus wrote in his article: So far this year, despite the influence of the epidemic, the global economic backwind, and the sales of global markets, the performance of Ruixing Coffee far exceeds the Standard Purcell Index (SPY). And Starbucks.

The market is full of coffee consumption scenarios and then segmentation

At present, China's coffee market is flowing all over, and coffee has gradually moved towards the track. Research reports related to China Merchants Securities show that the head brand is mainly based on the value of comprehensive product value and large chain brands applied by multiple scenarios, focusing on the creation of "third space". However, with the rise of Internet coffee models such as Ruixing, the cost -effective coffee brands focusing on the "fast coffee" scene are rapidly seizing market share by virtue of "mid -range quality, low -end prices"; It is popular with the new generation of consumers. In addition, there are cross -border players entering the coffee field of cross -border players who show the brand lifestyle, culture and personality, such as China Post, Li Ning, and People's Literature Press.

As a chain coffee brand, Ruixing has the advantages of the number of stores, and the difficulty of expanding the store is relatively small. The open franchise mode further improved efficiency. "In the second quarter, Ruixing Coffee opened 615 net new stores. It entered 11 new second -tier cities through joint venture stores and entered 3 new second -tier cities. We continue to focus on self -operated stores and retail cooperation The combination of partnership models further penetrate the market, so that we can meet the growing needs of customers in a flexible way. "Guo Jinyi said.

Rui Xing, who takes the first and second line as the main battlefield, now starts to compete for the sinking market. According to Jihai data, the coverage rate of stores in third- and fourth -tier cities in 2021 exceeded 80%. "However, while the sinking market has opportunities, it is also facing problems such as insufficient consumption foundation, increased management difficulty, and competition with tea." There is a voice in the industry.

Coffee has strong user stickiness and high repurchase rate. It is a gold track, but consumption habits are still in the cultivation period. People interviewed by the industry believe that making coffee in China is the most fundamental thing to make coffee delicious. "Rui Xing should be the new tea track." Industry insiders said.

"We believe that consumers are expected to form a V -shaped consumption structure and frequency. In the past two years, the rise of the coffee industry and the outbreak of new tea drinks have determined that the age structure of two types of drink consumer groups is mainly based on the 90s. Gradually from campus to the workplace and accompany age, due to health and other factors, tea consumption frequency "slope" downward, and drinking coffee will gradually become a habit and lifestyle of office refreshment. Form a typical "V -shaped" with age. "Yi Yongjian said.

That is, the "fast coffee" that is left is hot, so does the coffee industry still need the third space?"Consumption scenarios are still differentiated. Ruixing's stores are no longer limited to small stalls, and there are higher -end large stores. Consumers still need social, business communication and leisure and entertainment.Communication, Ruixing Store can also carry it now, and the space premium is less than Starbucks. For more high -end demand, consumers will choose a higher -grade hand -coffee store. "Lai Yang said that with the subdivision of consumer scenes,In order to cover a variety of consumer groups, the positioning, site selection, and scene construction of stores need to be further improved.■ China City News Reporter: Fang Ziwei

- END -