Why did the follow-up report of "Coffee accompany you" fall into the whirlpool of joining out of control?

Being publicly protested by franchisees, letting Korean brand coffee accompany you has become a hot topic during the May Day holiday. A total of 6 coffee shops in Chongqing accompany you to close, and coffee accompanies you to join the merchants to pull banners to protest. A reporter from the Beijing Business Daily visited a number of coffee stores in Beijing to accompany you, and the relevant person in charge of the northern region said that the northern region has not been affected, and the joining work of coffee with you is still going on, avoiding talking about how to resolve this dispute.

Deny that the management is out of control

Recently, an article called "Coffee accompanies you into a fraudulent company"? The article that the franchisee publicly protested against the inadvertence of the company's employees spread widely in the moments. The article mentioned that the franchise fee for coffee with you is falsely high, or even a false name. The management of the franchise store is chaotic. Due to arrears of payments from raw material suppliers, equipment suppliers and even the construction side, the raw material suppliers have stopped supplying materials to most of the stores in the country, and the equipment suppliers have refused to repair the faulty equipment. As a result, some products cannot be sold. All of a sudden, the image of the Korean brand endorsed by this Korean star has fallen sharply.

In response to the problem of false price or false title raised by the franchisee, the relevant person in charge of the northern region of coffee said in an interview with the Beijing Business Daily, "the cost of opening a store is very uncertain, and there is no problem of overpriced price." Coffee accompanies you the person in charge of Beiyuan Eashida store said that quality, interior decoration, area and other factors will lead to a big difference in store costs. The quantity of furniture, kitchen equipment and rent vary from store to store, so the total price will also vary.

With regard to the issue of the franchisee to accompany you with coffee to pay a deposit, the relevant person in charge of the northern region of coffee said that the deposit is to facilitate unified management and play a binding role in maintaining the brand image. For example, coffee accompanies you to charge a logistics deposit of 100000 yuan to ensure that stores use uniformly purchased raw materials. If a store violates the regulations and buys coffee beans on its own, the relevant fees will be deducted from the 100000 yuan logistics deposit.

In response to the coffee franchisee boycott in Chongqing, the relevant person in charge of the northern region of the coffee company said that the situation in the south was not clear, but there were no problems with the current raw material suppliers and equipment suppliers in North China, and the stores were operating normally.

In view of the current business situation of coffee accompany you in the Beijing area, a reporter from the Beijing Business Daily visited a number of coffee stores to accompany you, among which the store in Taohui Xintiandi, Wangfujing, has been renovated for nearly half a month, but it has not been opened for a long time. Staff near the store said that the main reason is that the license has not yet been completed, but does not rule out other reasons leading to non-opening. Staff at other stores said that business conditions had not been affected by Chongqing's joining problem.

In addition, a reporter from the Beijing Business Daily learned that the joining work of coffee with you is still in progress. According to a franchisee, in response to the franchisee protest in Chongqing, the relevant responsible persons refused to respond positively because they were not clear, and said that the joining and all work in the northern region were carried out normally.

Joining has been criticized repeatedly.

As a matter of fact, coffee accompanies you more than once because of joining. Before that, the stores that accompanied you in Guiyang, Hangzhou and other places were exposed by the media to close down because of joining problems. Not only that, because of joining problems, coffee with your membership card has also been criticized by consumers.

There have been a number of consumers reported that the chain brand coffee with your membership card can not be used in various stores. In this regard, the head of the coffee accompany you Beiyuan Yi Shida store said that the coffee accompany you membership system is uniformly managed by the headquarters. However, because the three processes of card opening, recharging and consumption need to be calculated separately, and the calculation of membership points between shops and stores also need to settle accounts with each other through the headquarters, the process is more tedious and troublesome. And this is not a rigid rule, the store is willing to sign with the headquarters, you can carry out membership card reception services, while those who do not sign the store have the right not to receive. Most of these unsigned stores are 100% franchised, that is, they are run by franchisees.

Coffee accompany you in charge of joining the business said that coffee accompany you in the Chinese market to adopt direct store, franchise store and cooperative operation of three store models. Among them, the franchisee means that the franchisee operates independently without leaving the coffee to accompany you in the management operation outline, and the franchisee needs to pay a management fee of 4% to accompany you to the coffee. In the case of poor operation, you can seek the management guidance of the coffee accompany you. The profit and loss of the store shall be borne by the franchisee on its own. Cooperative operation is equivalent to the "entrusted business license" model, in which the franchisee and coffee accompany your company to open a store with 49% to 51% of the shares, and the franchisee fully entrusts the management of the store to the coffee company. Coffee accompanies you with 4% of the overall gross profit as the management fee, the franchisee gets 49% of the remaining gross profit, and the coffee with you gets 51%. In this model, the franchisee does not have the right to manage the store, and the coffee accompanies you for unified management.

Hidden dangers buried by high-speed expansion

Coffee accompany you was founded in 2008, is the largest coffee chain brand in South Korea. In 2012, it partnered with a company called China Enterprise Investment Group to set up Coffee Management Co., Ltd in Shanghai.

According to the data, by the end of 2014, there are nearly 600 coffee stores in China, and we plan to open another 400 stores. Its "mini coffee bar" opened about 1000, "buffet coffee bar" opened about 1500, the year plans to complete 3500 stores and stores.

From the point of view of the industry, joining is the fastest way to achieve large-scale exhibition stores, but at the same time, there are many hidden dangers of development. There are not a few cases in which brand food enterprises in the catering industry have been frustrated by joining problems. Shangdao Coffee, a coffee brand that entered the mainland market in 1998, has been repeatedly affected by the joining model. The chain, which tried to be the coffee industry KFC, opened 700 new stores in the mainland in a year, but then declined due to chaotic management of franchisees and trademark management problems. Nowadays, when searching for coffee on Shangdao, the news that appears most often is the news of shop closure. Its scale and influence have gradually lagged behind Starbucks, Dior, Costa and other coffee brands.

In the view of the industry, the joining model has its development bottleneck: on the one hand, it is difficult to form an unbreakable common relationship between brand enterprises and franchise stores, and the performance of brand enterprises has a ceiling. On the other hand, due to the weak supervision in the later stage, it is difficult for the brand enterprises to control the actual operation of the franchise stores, which also leads to the mistrust of the franchisees to the brands.

Over the past decade, China's coffee consumption has continued to increase at double-digit growth rates every year, and the growth momentum in third-and fourth-tier cities is even stronger. Among the most favored franchise industry votes in 2014, coffee and beverages ranked first among investors. With the rapid development of coffee industry in China, it has attracted more and more brands. Rapid store has become the preferred strategy for brands to seize the market, but if you choose to join, you must guard against the hidden dangers of management.

He Chenhui, a reporter from Beijing Business Daily, Cheng Cheng, a trainee reporter.

Food expert Advisory Group

Jiang Junxian, Feng Enyuan, Xing Ying, Gao Bo, Xu Meng, Zhao Shu, Wang Chengrong, Lai Yang, Hong Tao, Wang Meiping, Meng Fangui, Su Wenyang and Liu Yida

Source: Beijing Business Daily