For catering companies, what kind of capital is good capital?
Source: Red Meal.com
Author: red food newsroom
What does capitalization mean for catering companies? What kind of restaurant company is suitable for holding capital? For catering companies, what kind of capital is good capital?
On March 30th, at the “2021 China Catering Industry Summit and the First China Catering Industry Red Bull Award Ceremony”, Canadia Capital’s founding partner Song Xiangqian gave a wonderful speech on the above issues. This article is a transcript of his speech.
I once said publicly that in the next ten years, China’s catering industry will fully complete the process of capitalization, branding, and chaining.
The scale of China’s catering industry is 4.72 trillion yuan. It is conservatively estimated that it should be able to solve 60 million jobs. In fact, with the addition of some mom-and-pop individual stores that have not been included in the national statistics, the scale of China’s catering should be nearly 6 trillion.
In the next ten years, China’s catering industry is likely to exceed the scale of 10 trillion, creating employment opportunities for 80-100 million people. Catering is a good track, which is also an important reason why Canadia Capital has followed up the catering industry for many years.
01 Capitalization is an industrial opportunity and a booster for catering companies
For catering people, the capitalization of catering is a very important opportunity, how to seize it?
First of all, there must be a subjective willingness to accept capital. Many catering owners are ignorant of entering the catering track, and they are also resistant to capital. People always feel insecure about strange things. However, only if you dare to challenge and accept new things can you get good opportunities.
Secondly, actively embrace standardization and capitalization. Standardization and capitalization mean the company’s management upgrade. The entry threshold of the catering industry is relatively low, and the overall quality of employees is not particularly high. In terms of business management, catering people still have a lot to go, and many lessons need to be made up.
If there is no capitalization, no listing requirements, and no external pressure, it would be very difficult for catering companies to reform solely on their own.
Image source: Photograph.com
We have invested in many companies. In the process of receiving capital, most of them have completed the iteration and upgrade of corporate management, and completed the iteration and upgrade of the operating system and organizational system. Standardization and capitalization are very important for the long-term competitiveness of enterpriseshelp.
Third, environment-driven. Enterprises are always facing the competition of various survival factors in the market. In addition to land, equipment, factories, and talents, capital is also a very important factor of production.
Whoever has more capital and more production capacity will be able to obtain a more advantageous position in the future commercial competition. Capital assists the development of enterprises and can promote enterprises to have more opportunities in future competition.
Image source: Photograph.com
Fourth, the business environment has undergone profound changes. As the business environment is undergoing comprehensive changes, companies must also follow up in time.
In the past, there were a variety of relatively less standardized operating methods for catering companies. In the context of the increasingly regular macro environment and fiscal and taxation environment, the market would force companies to carry out standardized reforms.
In short, for companies, capitalization is a booster. Taking advantage of the opportunities brought by capitalization, enterprises can complete standardized transformation; by introducing capital, they can also complete brand upgrades; and becoming a listed company has won market competition.
02 Catering companies must embrace capital, but good capital is valuable
It took 28 years for China’s catering industry to break through one trillion yuan, but it took only 3 years to go from 3 trillion to 4 trillion. In the future, it will be a very fast process from four trillion to five trillion or even ten trillion.
At present, my country’s per capita GDP is 10,000 US dollars, and it is moving towards 12,000 US dollars. Per capita disposable income is more than 30,000 yuan. China’s consumer service industry is also exploding.
For a long time in the past, the consumer industry was very lonely. Many capitals have focused their attention on the Internet, and the potential of the consumer service industry has not been well tapped. But in the past three years, the consumer service industry has been very hot, attracting the attention of many funds. Why?
General Manager Jia of Xibei once said: “Which business is more important than serving 1.4 billion people to eat well!” I very much agree with this point of view.
We are entering an era where water is more expensive than oil. Nongfu Spring is indeed more expensive than PetroChina, so people who consume it must have confidence. This is our super era.
Image source: Photograph.com
Canada Capital’s investment judgments have three growth references: the first is to buy industry growth, the industry must grow fast, and the total amount must be large; the second is to buy enterprise growth, the company’s growth ability must be strong, and it is the future. ;
The third one is to buy entrepreneurs, to buy the founder’s personality, learning ability, and growth in character. If these three growths can be perfectly integrated, they will gain time value.
In the next ten years, catering companies have a lot to do in the capital market, and a large number of high-quality listed companies in the catering sector will emerge in China. In the next five to fifteen years, there will be five to ten catering companies with a value of 10 to 20 billion, and 70 companies with a value of more than five billion.
Image source: Photograph.com
The catering is a big track. Under the catalysis of capital, the era of the catering industry has come. However, catering people also need to realize that good capital is valuable to the enterprise.
Food and beverage is a highly liquid industry, and its cash flow is also very good. There is no shortage of capital. What is lacking? In fact, the capitalization of catering is more about introducing capital to understand the industry. If you have capital that creates value, you can run this company together with you, run this brand, and run this business. Only this kind of capital deserves to be introduced.
Canada Capital has always used this mentality to serve the catering industry. We are not financial investors, but co-founder investors. We are empowered after the investment, conduct in-depth research on the catering industry, and deeply participate in the catering industry. Enterprise management.
Industrial capital must have a deep understanding of the industry in order to truly empower the company, integrate the capabilities of industry and finance, and increase value.
03 To be bigger and stronger, a restaurant company must have the desire to regulate itself
In the past two decades, why has catering been basically insulated from capital? With the exception of a few companies, the capitalization rate of the nearly five trillion race track is less than one in a thousand. What is the reason?
Many catering people are accustomed to the days of cash. They have never thought about how to regulate and strengthen the company. It is easy to be big and difficult to be strong because many companies do not regulate their desire to improve.
In the past ten years, capital institutions invested in the catering industry, and the whole army was basically wiped out, and Canadia Capital is the only one left. Why the whole army was wiped out? Either something is wrong or the person is wrong. In fact, when people are right, things are half right.
In the past ten years, more and more restaurant companies, such as Haidilao and Jiu Mao Jiu, have successfully gone public because of the right people. These listed restaurant owners all have the vision to become entrepreneurs, have the ambition and determination to lead the entire industry in China, and have the motivation to become entrepreneurs.
Image source: Hongfan.com.
The transition to an entrepreneur requires a high cost, and it is not easy and challenging, but if you do it, it will benefit you, your company, and your brand.
Listing is a milestone in life for entrepreneurs. Twenty years ago, if a restaurant owner said that I wanted to go public, to be a brand, and to globalize, everyone might think he was crazy, because the Chinese restaurant industry 20 years ago was very large, but decentralized. But not strong.
Chinese catering has always had such a “six-two-two” phenomenon. Of the ten diners, six lost money, two did not make money, and only two made money. This data is very tragic, and there are indeed many brands that have made a lot of money but have not made money. Businesses have become social welfare undertakings. Just solving employment can not create wealth and create value.
However, China will surely complete the high penetration of chain, branding, and capitalization in the future. The catering industry is accelerating industrial concentration, and the head effect will be very obvious. The ratio is probably the 28th rule, or even the 19th rule.
In other words, only 10% of the people on each track can survive, and only 1% of the 10% companies will become great companies.
Jiu Mao and Nine Hong Kong Stocks are listed
In the face of such a great era, it is very important for every entrepreneur, especially entrepreneurs who are aspiring to become industry champions, to get ahead, take the lead, complete capitalization, and complete corporatization.
With the release of an infrastructure-level reform such as the registration system, entrepreneurs who do well in business will have the opportunity to compete on an equal footing in front of the capital market. This is for all catering peopleThis major institutional benefit is also a historic opportunity.
04 Catering companies with a champion’s heart are suitable for capitalization
The capitalization of the catering industry is mixed, what kind of company is most suitable for capitalization?
First, the motivation must be strong. We must have confidence in the corporate system and modern corporate operating system, be willing to accept constraints and management, believe in management science, and firmly believe that the pursuit of capitalization is right.
Businesses such as individual industrial and commercial households and husband-and-wife shops are difficult to talk about capital, because they have to iteratively upgrade their organizations and the learning journey is relatively long.
Second, strong learning ability. Many bosses tremble when they hear about the financing and listing. In fact, capital institutions are professional athletes. As long as you follow the gourd, as long as you have strong learning ability, determination and perseverance, you can know how to go public.
Third, there must be a strong vision. If you want to become a capitalized company, you must have a strong vision. If you want to become the industry’s leading company, leader, or industry champion, you must have a champion’s heart. A strong vision is very important.
The big food sector in the future, including the catering supply chain, will have great opportunities, but not everyone can seize it. Companies with champions have even greater opportunities.
Picture source: Naixue’s tea official image
The future is the era of refined company management. Haidilao did not introduce management science, it cannot become Haidilao, everyone must believe and acknowledge this logic.
Capitalization and branding are the only way for the development of a great company. At the same time, capitalization is also very helpful to the development of a company’s true long-term core competitiveness. By completing capitalization, chaining, branding, and finding the right growth model, such a company can become an invisible champion on each subdivision track.
After being listed, some catering companies have developed far better than their peers. Because of the iterative development of a series of resource elements such as operations and strategic optimization over the years, they have already possessed long-term core competitiveness and can enjoy the time zone safely. The value of benefits.