There are young people in the forgotten corner.
Editor’s note: This article is from the WeChat public account “Yibang Power” (ID:iebrun).
Author丨Li Tongxin Lu Yao
Edit丨Shen Qiao
For 5 months, Luckin Coffee is still alive.
This once-popular star company has created “the biggest scandal in the history of China’s stocks” by exposing financial fraud, and it delisted like a falling dog. Surprisingly, Ruixing Coffee, which was originally predicted to cool down, did not give up struggling to survive, but showed signs of bottoming out.
4000 stores across the country are still operating in an orderly manner, and most of the stores have turned positive in cash flow. Signed the sub-brand “Little Deer Tea” endorsed by top artist Xiao Zhan. Dozens of new products are launched intensively. Consumers who vote with their wallets don’t care about the blood and rain in the capital market. They only care about whether they can drink it cheaply. Coffee to drink.
In the new Luckin story, which has both good and bad, the main melody is regenerated.
Behind Luckin’s “Resurrection”, there are countless hidden corners where the fate of 30,000 small people is tumultuous. In the five months after the fraud, some of them were laid off, some voluntarily left, and some were still holding on, but they almost invariably believed that “Luckin can’t die.” Will these confidences become Luckin Coffee’s “life-saving remedies”?
Under the shadow, Yibang chatted with several young Ruixing people with different positions and responsibilities. The following is their self-report:
“Luckin can’t die. How can no one vote if you can make money?”
On April 2, Ruixing issued an announcement to expose financial fraud. I just took a shower that night and found that WeChat had exploded when I came out. A group of students from the financial and Internet circles asked me: “Luckin had an accident, do you know?” I was a little confused, and then I saw the company’s stock price plummet.
The colleagues are a little weirdly quiet, and no one is in the groupWhat remarks to make. When we went to work the next day, HR talked to employees one by one and told us not to panic. In order to maintain stability, the company originally planned to pay wages on the 15th, which was paid 5 days in advance that month.
The company received a short report from Muddy Waters on January 31 this year, but this matter has little to do with our lower-level employees. No one took it seriously at that time, and didn’t think it would make any waves.
I didn’t feel much at first, and it wasn’t until the company started to lay off employees in late May that I realized that the atmosphere was not right. Suddenly, the surrounding workstations are vacant. They may have been optimized, or they may have taken the initiative. No one can tell the specific situation. The Beijing company cut about 10%, and the Xiamen company has more, possibly 30%. It is said that the people who are laid off have good relations with HR, and I also want to be laid off, and I can get N+1 compensation.
I am doing industry research at Ruixing. This is my first job after returning to China after graduating from a master’s degree abroad in early July 2019. For this job, I gave up the opportunity of several brokerages and real estate investment and financing analysis posts.
At that time, Luckin’s development momentum was extremely strong. Just a few days after I joined the company, Luckin Coffee’s 3000th store opened in Hangzhou, and news was overwhelming. According to Luckin’s founder Qian Zhiya’s plan, by the end of 2021, Luckin Coffee will open 10,000 stores.
Qian Zhiya at the Luckin Coffee 2019 Global Partner Conference
My department is equivalent to Ruixing’s internal consulting company, directly under the president’s office and reporting directly to Lu Zhengyao and Qian Zhiya. We are responsible for researching various new tracks that the bosses are interested in, such as whether Luckin can make meal replacements, how other companies do it, and what advantages Luckin has.
General Lu has a relatively strong personality. He started as a car rental in China, and all areas of the car rental business are always very straight people. He feels relatively northeast, and it is not strong and can not be suppressed. Qian always speaks very softly and his voice is very soft. She has a great view of the industry and belongs to the kind of leader who makes people comfortable and trustworthy. I like her very much.
Working at Ruixing is very easy, as long as the research report submitted can show the industry situation that the boss wants to know. If he feels ok, let the business department follow up, if not, go to the next question. We all get off work at one point and never get off work overtime. The company recruits young graduates like us, just because we want to diversify ourselves.
Our department was disbanded in mid-April on the grounds that “the company does not need to study newIndustry”. I was transferred to the product center to do product data analysis, and I also considered leaving since then.
When Ruixing laid off its staff and went to the hot search, the epidemic was no longer so nervous, and the sales in first-line stores were not bad. Some users are worried that Ruixing will close down and rush to place orders to consume coupons in their hands. Many stores are in a state of “explosive orders”. However, in order to reduce costs, the company started to cut non-operational departments, and only the operations, product and supply chain departments were operating as usual.
Luckin can’t die.
Luckin’s business model is actually not a big problem. It is impossible to collapse due to high-level financial fraud. Financial fraud is for the capital market. How can you raise money if you don’t tell stories or draw cakes? Only the good-looking financial report data shows that this model is indeed feasible and can get more money.
The company has planned to close down some stores that are not profitable. The internals have basically returned to normal and sales are good. The cash flow of the restored stores has turned positive. In July, the overall break-even is achieved, but it is true that capital takes over. Slow down. After Luckin’s delisting and privatization, it is actually very simple to find individuals to invest. The business model is still good. How can no one invest if it can make money?
Luckin also has the fawn tea card in his hand. Xiaolu Tea focuses on the third and fourth-tier sinking markets. It is priced between Xicha and a little bit for the standard Hey Tea. It spends a lot of money to hire the top-notch Xiao Zhan as an endorsement. Other milk tea brands rarely invite spokespersons. Sinking is the general direction of all industries. The population of first-tier cities returns to lower-tier cities, and this part of consumers must be captured. Unfortunately, Ruixing is not as rich as before and can’t afford to subsidize.
Source of Xiaolu Tea Store: Yibang
In July of this year, I proposed to resign, and the company symbolically used a promotion and salary increase to stay. But my job-hopping was not entirely affected by the short-selling incident, and I was mainly focused on doing research.
I now work in an Internet consulting company. It’s not as good as being the father of Party A at Luckin before. The client is very clueless about the details of the report, but the overall situation is smooth. The boss’s accident has nothing to do with me, and the company’s financial problems will not affect others’ evaluation of my personal ability. Luckin is still very strong in the eyes of others, and it has done a great deal quickly, and it has not changed the entire industry small.
From the perspective of industry research, although Luckin is very young, it is an ambitious company. Before Luckin appeared, the domestic coffee track was almost blank. Choose the right industry, plus Luckin’s “fromCoffee began to make Luckin a part of people’s daily lives.” This business story is well told, and it created the myth of being on the market for 18 months. Luckin wants to do more than just sell coffee, but cut into more retail through coffee Catering segmentation.
Luckin is not just “China’s Starbucks”, it wants to do more than Starbucks.
、“Starbucks is brazencut leek.”
On January 31, the day when Muddy Waters issued a short selling report, it spread within the company. Our Guan trainees have more than a dozen masters studying abroad, and they spend all day browsing Twitter. I don’t understand the capital market. The company’s stock price has risen after denying the fraud, so I didn’t take it seriously. I am in charge of the new business, and I have been exhausted all day long, and I have no time to consider shorting. After all, this matter belongs to the senior management.
At the time, no one thought that this would be such a big trouble, and it would be the step of delisting.
On April 2, the company revealed that financial fraud was trueThe hot search was a sensation. After going to work the next day, everyone seemed calm. The headquarters sent an internal letter, let us not worry, and paid two days in advance. I am very happy. As a small social animal who has just entered the society, this means that my rent for the next quarter has fallen.
A high school student who studied finance knew that I was in Luckin, so he came to ask me, “Is your company going to die?” In the week after self-exposure, almost all Luckin stores were “exploding orders”, but inside the company It’s just four words-precarious.
Luckin is like a wild horse running off the rein. The pause button is pressed. The leader informed me that the franchise plans of Luckin Coffee and Xiaolu Tea are suspended. I guess the company’s senior management needs to spare time to adjust the organizational structure and management system. The story of Rui Xing was too beautiful before, and it was pushed to the altar by the capital market, and he almost played himself to death. Now he has fallen into the altar and must change.
For the past six months, Luckin has been doing store optimization. It is normal to close the store, and basically healthy stores can survive. It used to be blind to open a store, so I opened it if I had a place, but now it’s different. I wouldn’t open a store in a bad location.
Although Luckin claims to be an Internet + new retail company, it is essentially the catering industry. I am very confident that we are the leaders in the domestic catering industry before and after exposure. Luckin did not relax its quality control even when it was the most inflated. The catering industry cannot just look at market value. Whether Luckin can get back on track depends on whether it can guarantee low prices and adhere to quality control. A cup of coffee sells for more than ten yuan to make a profit, and Starbucks sells a cup of thirty or forty yuan that is blatantly cutting leeks. A cup of coffee costs 3 yuan, you sell 36 yuan, are you kidding?
People who have been to the Ruixing store can see that our staff is very young. Young people are less slick and can enforce rules and regulations more strictly to ensure standard operations. The hourly salary of Luckin’s part-time clerk is the highest in the catering industry. On the one hand, the company was rich at the time, on the other hand, it was not easy to pick up a high hourly salary.
We have the same requirements for part-time shop assistants and regular employees. The store is constantly launching new products, which means that the clerk has to constantly memorize new product formulas, keep familiar with the operating standards, and often take various internal examinations within the company. People who have been working in Luckin’s stores for more than two months will involuntarily become hygienic, which is not the case in any other catering industry.
Luckin will not collapse, I have this confidence.
Luckin has only been established for less than three years, and I never overestimate Luckin’s influence. The main concern in the society is the practitioners in the industry. Except for those who hold Ruixing stock in the secondary market, we have not harmed the actual interests of Chinese consumers. There are delicious and cheap coffee, why not buy it? Human nature is like this. Consumers will not be too harsh on us and stand directly on the opposite side. There are not many people who really understand Ruixing’s exposure to fraud. The hot searches are just the people who eat melons. They don’t spend time thinking about who is right and who is wrong. Some people on Weibo say that fraud is not good, and some say that Ruixing did a good job, which is equivalent to free marketing