Ruixing Coffee came out of the "Dark Moment". Single -quarter revenue was $ 50 million in Starbucks China. Has it finally turned over?

From bankruptcy reorganization to continuous profit, OTC: LKNCY has quietly completed a gorgeous turn.

According to Ruixing's second quarter financial report, the total net income was US $ 490 million, a year -on -year increase of 72.4%. The revenue of Starbucks China in the third quarter of the fiscal year 2022 (April 3-July 3) was US $ 540 million, a year-on-year decrease of 40%.

In other words, Ruixing's single -quarter revenue, compared with Starbucks China, the boss of the domestic coffee market for a long time, has only a gap of $ 50 million.

The Red Star Capital Bureau noticed that in addition to the turnover, Ruixing's ability to make money is gradually becoming stronger: operating profit margins and sales of the same store are growing at high speed. Its highly flexible and fast -storeing small shop model also seems to have stronger anti -risk capabilities under the epidemic.

All signs show that Ruixing has gradually stepped out of the dark moment of financial fraud and bankruptcy reorganization, but it is not so easy to replace Starbucks.

1

Ruixing profit for two consecutive quarters

Revenue is close to Starbucks China

On August 8, Ruixing released the second quarter financial report.

According to financial reports, Ruixing's total net income in the second quarter was RMB 3.299 billion (US $ 493.2 billion), an increase of 72.4%over the same period in 2021, and an increase of 37.18%from the previous quarter.

In the second quarter, the profit was 242 million yuan, an increase of 290 million yuan over the same period last year. The Red Star Capital Bureau noticed that this is also Ruixing's second consecutive quarterly quarterly. In the first quarter of this year, profit was 16.1 million yuan.

On the other side, Coffee Giant Starbucks also recently released the third quarter of fiscal year in fiscal. The total net income in the quarter was US $ 8.15 billion and its operating profit was US $ 1.295 billion. Among them, the total net income of international business was 1.585 billion US dollars, and Starbucks China revenue was US $ 540 million, a year -on -year decrease of 40%.

In other words, Ruixing's total revenue in the quarter was only about 6%of Starbucks in the same period. But looking at the Chinese market alone, Ruixing has only been worse than Starbucks China $ 50 million.

In addition, Ruixing's number of domestic stores has exceeded Starbucks and ranks first in the national coffee brand. At the end of the second quarter, the number of Ruixing stores was 7,195, surpassing 5,761 stores in Starbucks China.

Among the Ruixing 7195 stores, including 4,968 self -operated stores and 2227 cooperative store stores. In the second quarter, sales of self -operated stores increased by 41.2%, and the operating profit of self -operated stores was RMB 712.2 million (US $ 106.5 million), and the store operating profit margin was 30.6%.

According to financial reports, Ruixing's average monthly trading customers are also increasing, reaching 20.7 million, a year -on -year increase of nearly 70%.

What is more reflected in its ability to make money is that the operating profit margin of Ruixing's self -operated stores in the second quarter exceeded 30%, an increase of 7%year -on -year. Guo Jinyi said in the financial report that this was due to the continuous expansion of the store and the continuation of operating leverage.

↑ The second quarter of the financial report released by Ruixing

2

Small shop model takes advantage

New products and new stores appear at high speeds

The Red Star Capital Bureau noticed that recently, Wang Jingying, chairman of Starbucks China, disclosed at the financial report and telephone. Only in the last quarter, Starbucks had more than 1,300 stores to be temporarily closed. According to Guo Jinyi, CEO of Ruixing Coffee, in the second quarter, Ruixing's average of about 670 stores was temporarily closed every day.

In this context, Starbucks China's market sales in the second quarter fell 44%, but the sales of the same store in Ruixing's self -operated store increased by 41.2%.

How did Ruixing go against the trend? Compared with Starbucks China and Ruixing, the Red Star Capital Bureau discovered that the Ruixing shop model showed more advantages in the background of the epidemic, which was less affected.

The area of ​​Ruixing Store is small and is made of automatic coffee machine. This model has prompted Ruixing's store operation costs and labor costs, high manpower costs, high flexibility, and easy sinking and scattered distribution. After the city and the point are more, the resistance to the epidemic is also strong.

Although it is a "small shop", Ruixing's average single -store revenue is not low. In the second quarter, Ruixing Single Store's revenue was RMB 458,500, which was 72.41%of Starbucks single -store revenue on behalf of the "big shop model". In an interview with the Red Star Capital Bureau on August 10, Zhu Danpeng said that although Ruixing's customer unit price was not high, the order rate was high.

Data diagram according to IC Photo

In addition, Ruixing also continued to push new products and open new stores in the second quarter, which stimulated the sales of various shop products, thereby promoting revenue growth.

Ruixing CEO Guo Jinyi said that Ruixing launched 34 new products in the second quarter, which is equivalent to one model every three days. There are also explosive models in the new products. From April 2022 to the end of the second quarter, the new product "coconut cloud latte" sold more than 24 million cups.

In the second quarter, Ruixingjing's newly opened stores were 615. According to Guo Jinyi, in the second quarter, Ruixing entered 11 new low -line cities through the joint venture store, and entered three new low -line cities through self -operated stores.

It is worth noting that Ruixing's supply chain capacity is also strengthened. Last year, Ruixing's first baking factory was put into use, with a design capacity of 15,000 tons. According to Guo Jinyi at the financial report, Ruixing Coffee's second coffee roasting plant (Kunshan Factory) has signed an investment agreement in the second quarter with a design capacity of 30,000 tons.

3

The performance is not far from Starbucks China

But it is difficult for Ruixing to be Starbucks

All signs show that Ruixing has gradually stepped out of the dark moment of financial fraud and bankruptcy reorganization, but it is not so easy to replace Starbucks. First of all, although the net income in the second quarter was only $ 0.50 million, there was still a gap between Ruixing and Starbucks.

From the data of the first quarter of 2022, Starbucks' revenue in the Chinese market reached 860 million US dollars, almost twice as much as Ruixing Coffee. In the second quarter, Starbucks's performance declined, mainly due to its affected affected by the focus of Beijing and Shanghai. The reporting period belongs to the trough period of Starbucks China.

Starbucks temporary CEO Howe Schultz said that as most Starbucks stores in Shanghai have resumed indoor dining services in June, Starbucks is expected to effectively improve the Chinese market revenue in the next fiscal season.

In addition, although Ruixing has often compared himself with Starbucks since its establishment, it is also called "Chinese version of Starbucks", but Ruixing and Starbucks are not on the same track.

From the price point of view, the unit price of Ruixingke is around 15 yuan, and the unit price of Starbucks is around 30 yuan, and the positioning is different.

The consumption scenarios of Ruixing and Starbucks are also different. Ruixing is a small shop model, which pays attention to buy and go. Consumers have more functionality or tastes of the essence of coffee; Starbucks pays attention to the third space, business meetings, dating gatherings, and even brand tone. Attributes are consumers' expectations for it.

The two of the two are also different in the training of baristas. Starbucks has always attached great importance to the cultivation of the barista. It will use apron of different colors to distinguish the barista grade with badges in front of the chest, and use competitions and tests to designators' upgrade routes. Some people in the industry said that there are only two kinds of apprentices and barista in Ruixing barista, which has lower requirements for baristas.

Data map according to Starbucks China's official Weibo

Just as the mid -end brand of the new tea track raises the price, the high -end brand price reduction trend, in fact, Starbucks and Ruixing are also trying the other's model.

Starbucks borrowed some of Ruixing's experience: on the one hand, vigorously developed special stars to send and fast brown; on the other hand, began to try more attention, services and digital "brown" concept stores. Rui Xing was also penetrating into the consumption scene where Starbucks was located, and opened shops including sofas, tables and chairs, etc. that can accommodate super ten people.

However, Ruixing and Starbucks are still very different brands. Ruixing is one of the best in terms of cost -effectiveness, and Starbucks China has precipitated for more than 20 years in the construction of "third space" and 30 yuan prices.

Today, Ruixing seems to have turned over, and there is even a trend of later, but still facing many problems: the impact of damage to financial fraud, and questioning the quality and service of the product, the siege of the emerging coffee brands such as Manner ... These all need to be resolved one by one.

Red Star News reporter Yu Yao Zhang Luxi

Editor Deng Yiguang Editor Wang He

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