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On June 5th, Hong Kong stock company Hai Di Lao held its 2023 annual shareholder meeting. Over the past year, Hai Di Lao has emerged from a downturn and its performance has continued to rebound; At the same time, new measures such as open franchise and building campus brands have also attracted market attention. At the meeting, company executives responded positively to many issues that investors are concerned about.
On March 4th of this year, Hai Di Lao announced that it would open up franchisees, which attracted high market attention. Can Hai Di Lao, who is known for its excellent service, maintain its level of excellence in the franchise model? How can quality control and management keep up? At this shareholder meeting, "prudence and stability" became the basic attitude of the company's executives towards this new attempt.
"Franchising is a supplement to Haidilao's existing business model, and we are also exploring franchise models that are suitable for Haidilao." Zhou Zhaocheng, Vice Chairman of Haidilao's Board of Directors, explained that currently, Haidilao's franchising is more like a form of trusteeship. "The entire operation and management team, system, and direct stores are no different."
From the perspective of executives, the joining of Hai Di Lao is more like a financial investment than a free play by franchisees. "We are still promoting franchise through a one store one discussion approach," Zhou Zhaocheng emphasized. Currently, all stores, including the Shuhai supply chain system, adopt a set of systems. "If franchisees have some resources to share locally, we will also audit according to the supplier's standards."
In addition, regarding the excessive enthusiasm of some investors in the current market for joining Haidilao, Zhou Zhaocheng also took a "preventive shot" in advance. He said, "I still need to emphasize that Haidilao is not a profit-making business model, and the catering industry is not a profit-making industry, so the risks of investment itself cannot be ignored."
In addition to the franchise model, Haidilao's exploration of various new brands and models in the past year has also attracted the attention of investors. "We have made many attempts at new formats and brands internally, and our enthusiasm for innovation is high," said Zhang Yong, Chairman of the Board of Directors of Haidilao. "For innovation, we are willing to pay the cost, not afraid of failure, and adopt a weak regulatory approach to ensure that innovation has the opportunity to be implemented."
According to public reports, in recent years, Haidilao has established an innovation and entrepreneurship office at the headquarters level, adjusted its entrepreneurial brand strategy planning, and successively incubated brands such as Xiaohi Hot Pot, Miao Shixiong Fragrant Pot, Wugu San Meal, Yanqing Roast Meat Shop, and Hanshe. It has also expanded its business layout in multiple categories such as hot pot, fast food, grilled meat, and Chinese cuisine.
It is worth noting that Zhang Yong stated at this conference that in the future, Hai Di Lao may adopt a one to many store manager management model. "In the future, Hai Di Lao will consider the development of multiple categories and levels. For example, there may be new formats such as barbecue and noodle shops around a hot pot restaurant." He said that in the future, multiple stores managed by a store manager can share resources.
In addition, at this conference, Li Peng, Executive Director, CFO, and Contact Company Secretary of Haidilao, further revealed that with the continuous optimization of the company's business performance, this year, the incentive policies for store managers and key employees have been further optimized, and the dividends of stores are linked to management levels. This will further stimulate the potential of store managers and key employees, and continuously improve the management level of stores.
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