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Cuddy secretly raises prices while cutting franchisees 'leeks?!

Published: 2024-02-29 Author: World Gafei
Last Updated: 2024/02/29, ▲ Click to follow| Daily boutique coffee culture magazine coffee workshop once with "9.9 yuan a cup" low name Kudi coffee now unexpectedly want to raise the price in an all-round way, this is to withdraw from the price war? Last year's coffee circuit saw a high-profile contestant, Coody Coffee, less than 10 months old, officials said

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Cuddy Coffee, which once made its name at a low price of "9.9 yuan per cup", is now going to rise in an all-round way. is this going to withdraw from the price war?

Last year, a high-profile competitor appeared on the coffee track, Coffee Coffee, which was founded less than 10 months ago. According to officials, the number of coffee stores nationwide has exceeded 5000.

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In February this year, Cudy launched a low-price strategy, launching a two-month campaign with more than 70 products priced at 9.9 yuan per cup and inviting new users to have free coffee at 0 yuan. Since May, Kudi Coffee has once again launched the "Summer Ice drink season, 9.9 every day" and launched a "free purchase of 8.80 yuan" on Douyin. This made Cuddy go out of the circle quickly and launched a campaign that sold more than 1.53 million people in two weeks.

Under such stimulation, Rui Xing couldn't sit still. In May, she also launched 9.9 yuan coupons, and in June announced the launch of a regular discount program of 9.9 yuan per week. But how long can they last in the same 9.9 price war? In terms of data, Ruixing 9.9 can barely make money, coupled with Maotai co-named "Maotai latte" popular circle, and Kudi coffee opened a lot of gap.

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But the sales of Cuddy Coffee are not optimistic.

Sales fell sharply, so Cudy secretly raised prices in July. In early July, Kudi first restricted the purchase of coupons with a group purchase of 9.9 yuan on Douyin, offering volumes of 13.50 yuan and 14.9 yuan. In early August, Kudi directly cancelled the "9.9 yuan per day" activity. Kudi also removed 8.8 yuan vouchers from stores, and only raw coconut lattes can enjoy 8.8 yuan discount.

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For franchisees, the threshold of Kudi's model of not charging franchise fees is low, and the investment is only about 300000-600000, but the actual cost after entering the market still needs to be higher. Due to the lack of influence at the beginning of the opening of the store and the low-price promotion of Kudi, you also have to pay a service charge of 10%, 25% to the headquarters every month. It's basically just a loss. According to the data, the number of Coffee Coffee shops closed from January to June in 2023 reached 318. An average of 1 per day!

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In addition to the problem of sales volume, there are frequent problems of insufficient supply chain in Cudy, untimely preparation of supply chain, slow product quality control, slow material delivery, incomplete configuration and so on.

Under such circumstances, many Kudi coffee shops closed down, and Cuddy franchisees complained that the price of 8.8 yuan of drinks was difficult to make money, the sales at normal prices did not go up, and it was difficult for franchisees to persist.

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There are also many franchisees said that shortly after the opening of the store, two new Kudi opened within 1 km, forming internal competition. As a result, many franchisees quit one after another and complained about exposure on the Internet to persuade other franchisees who wanted to join.

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But on July 17th, Kudi Coffee announced through its official account Wechat that its East China supply chain base is located in Dangtu, Maanshan, Anhui Province. The project with a total investment of about 200 million US dollars is the first supply chain base of Kudi Coffee. The supply chain base is positioned as a collection of research and development, production and quality control, and will be officially put into operation in the second half of 2023. I don't know how long the franchisee will last. The fundamental reason is that the price increase of Kudi can not retain consumers, how long can Kudi, who relies on franchisees for blood transfusion, last?

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