Will "Coffee accompany you" come to an end in China?

Coffee with you (Caffebene)

Korean coffee "Coffee accompanies you (Caffebene)", which has been in China for exactly three years, is praised by the industry for its rapid expansion.

But at the end of 2014, there was a lot of talk about the crazy closure of "coffee with you" across the country, arrears of wages, arrears of goods payments to suppliers, deception of franchisees and so on.

An open letter of "Coffee to accompany your partner" has pushed "Coffee with you" to the forefront, and people expect "Coffee to accompany you" with a new face.

However, half a year later, "Coffee with you" still can not get out of the quagmire.

Is it true that "Coffee with you", which is popular all over Asia, will really come to an end in China?

What happened to "coffee with you"?

In 2008, the founding store of "Coffee with you (Caffebene)" in Qingtan Dong, Seoul, South Korea, opened.

Different from the concise and business-oriented European and American cafes, Coffee accompany you has a spacious and bright space, everything in this space is full of design sense-high hanging crystal lights, clean floor-to-ceiling windows, large log-colored tables, walls full of magazines and books, small hourglass timing. Warm and romantic.

In South Korea, which covers an area of just over 100000 square kilometers, "Coffee with you" has rapidly expanded to more than 900stores, leaving Starbucks with only 15 per cent of the market share in South Korea.

Then, "Coffee with you" rushed out of the country, and in a short period of two years, it blossomed everywhere in China, Japan, Vietnam, Cambodia and other Asian countries, and even traveled across the sea to Broadway Square in New York. It is worth mentioning that "Coffee with you" has reached more than 600 stores in China only three years ago.

The Coffee with you chain is growing like a cockroach. Nevertheless, Coffee with you continues to expand nonstop.

For the 2015 plan, the Coffee accompany you team said it would continue to open 400 stores across the country to achieve the landing of the second phase of the Thousand Store Strategy. In addition, its "mini coffee bar" plans to open about 1000, "buffet coffee bar" to open about 1500, the year plans to complete 3500 stores and locations.

But at this time, "coffee with you" has been constantly criticized:

In Guangzhou, seven of the 18 stores were closed, and a former employee revealed that "Coffee with you" had owed employees' wages, and even revealed that South Korea was suspected to have withdrawn from the Chinese market.

In Hangzhou, 9 of the 19 stores were closed, and many customers reported that the services of different stores were very different, the tastes of coffee and desserts were different, and even the prices of promotional activities were not the same.

In Chongqing, franchisees have asked for the termination of the contract, and after repeated unsuccessful negotiations, they also found that almost every item in the long list of fees for "coffee accompany you" has the problem of overpriced or false names.

After all, what happened to "coffee with you"?

Why did you close the shop?

Exploring the mode of "coffee accompany you", it is not difficult to find that its chain stores are divided into four modes: wholly-owned, entrusted joint venture, financial innovation and coffee bar entrusted lease, and the entrusted joint venture stores account for the majority.

According to the official website of "Coffee with you", under the entrusted joint venture, "Coffee with you" accounts for 51% of the shares and 49% of the franchisee. "Coffee with you" has absolute control over the store and has an absolute say in management.

It is not difficult to find out the reason for the frequent closure of "coffee with you".

one。 The disadvantages of the model

Most of the "Coffee with you" stores are franchisees, and the main opening model of "Coffee with you" is its self-proclaimed "entrusted entrepreneurial franchise model." except for a few direct-run stores, more than 95% of the stores in the country are franchisees. On the other hand, the franchise store takes 50% joining (half of the company and half of the franchisee) as the main mode.

The pace of expansion of "coffee with you" is too fast, and the profitability of individual stores has not kept pace with the pace of expansion. Whether it is an entrusted joint venture model that can provide a large source of funding, or at least more than half of the stores can make money, so as to subsidize the other half's long-term development, but in fact, most of the Coffee with you stores are losing money.

two。 Standards vary from store to store

The most difficult thing for a chain franchise is how to implement the standard process management of the store.

If there is no standardization, then the significance of the chain is not great. Imagine that in different stores of the same chain, customers will eat different products and receive different services. Can this still be regarded as the same brand?

And "Coffee with you" is in such a situation in China, even if you go to the same store at different times and choose the same product, you will have different tastes. "Coffee accompany you" in addition to the unified store image, other items in different franchise stores will reflect different standards.

three。 Zero management and operation capability

The original purpose of the franchisee of "coffee accompany you" and the company's share-sharing model is to prevent franchisees from participating in the management of stores. But the fact is, "Coffee with you" company's store operation and management capacity is basically zero, on the contrary, most franchisees have become the main managers.

The reason is that the team management of the company is difficult to keep up with the rapid opening of the store. For example, the opening of a new store is difficult for the company to find a qualified manager quickly, while the franchisee can take advantage of local resources to find the right person; in addition, the franchisee can basically come to the store every day for "guidance". And the company's regional general manager or tutoring is only to inspect the store, the franchisee naturally becomes the real manager.

four。 China's coffee consumption market is still at a low level.

South Korea has a population of 50 million, with a per capita annual coffee consumption of 300 cups, with a total annual consumption of 15 billion cups. China, with a population of 1.4 billion, consumes less than 3 cups of coffee per capita, and the total annual consumption is 4.2 billion cups, less than 1/3 of that of South Korea.

"Coffee with you" has nearly 1000 stores in South Korea, and now has more than 400 in China, which has completely exceeded the consumption of coffee in China. Running too fast in a primary consumer market is tantamount to cutting off the way back.

The industry reshuffle is coming.

I do not know when, cafes began to appear in the city like bamboo shoots after a spring rain. Especially recently, the value of cafes has been rediscovered, and it has become a panacea for cross-border marketing.

Just give me a few examples. A few days ago, Uniqlo in the United States introduced Starbucks in the store in an attempt to give customers a better experience and keep them a little longer. Prior to this, Macy's, Target supermarket and Barnesand Noble Bookstore also introduced cafes early.

Take the Fangsuo Bookstore in Taiguhui, Guangzhou as an example, it also integrates the mixed operation of bookstore, aesthetic life, coffee, exhibition space and clothing fashion, which can be said to provide a variety of services.

There is also a cafe called "ideal time", which not only provides coffee and exquisite decoration environment, but also sells almost all the furniture and decoration, such as dining chairs, tables, wall clocks and so on, which customers can pack and take away as long as they like.

Of course, there are luxury goods. Gucci has opened two coffee shops in Florence, Italy and Tokyo, Japan. The treasure of the town shop in Gucci Cafe in Ginza in Tokyo is not coffee, but Gucci chocolate used to match coffee.

Recently, China Merchants Bank jointly launched the first coffee bank in China, where customers can not only enjoy a leisure, comfortable, petty-bourgeois coffee shop environment, but also get the bank's professional financial services.

It is not difficult to see from these examples that with the increasingly fierce competition in the industry, the situation of "one family is dominant and waiting for guests" has changed dramatically. Cafes and other forms of business must be operated differently in order to gain a firm foothold in the market, and they are all trying their best to seek partners who borrow from each other.

Moreover, China's annual coffee consumption of 70 billion yuan is 2-3 trillion yuan away from the mature market, and there is still a huge market space, which provides the possibility for cooperation with other industries.

Coffee shops across the border not only share the high rent, reduce operating costs, but also promote marketing, the two sides to achieve a win-win situation, why not do it?

But it should be noted that cross-border cafes are like "finding a partner", not only in terms of brand culture, service and quality, but also to try their best to meet the complementarity of user experience, rather than simply the complementarity of product functionality.

Source: business community