Rachel's self-help: No Starbucks life, got ofo's disease?

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Rachel's self-help: No Starbucks life, got ofo's disease?

2019-04-25 21:29:39 23 ℃
On April 22, the Securities and Exchange Commission of the United States (SEC) released the prospectus submitted by Reichen Coffee, which will seek to list on Nasdaq and plan to raise $100 million. Less than two years after the founding of

, Ruixing Coffee, a rapidly expanding coffee company, has 2,370 self-owned stores, and has gradually achieved a solid and crucial step in capital development.

A cup of coffee, a long summer afternoon. In people's impression, coffee and literature can always touch a little bit. It is said that every woman of literature and art has a dream of opening her own coffee shop. But Ruixing has nothing to do with Qingxin, more like a gambling, gambling user acceptance, but also gambling on their ultimate management level and market rhythm. Before coffee could decorate the delicate life of more Chinese people, Ruixing rushed down to earth and kept pace with roadside milk tea shops.

The winning rate of this gamble is not high, but it is not a doomed outcome.

01

Will Richmond be the next Starbucks?

Before Richmond submitted its IPO prospectus, it just announced on Thursday that it would receive an additional $150 million in new investment on the basis of the B-round financing completed in November 2018. Among them, the private equity fund managed by BlackRock invested $125 million, while the value of Reichen Coffee was estimated at $2.9 billion. Starbucks'largest active investor, second largest shareholder and one of the world's largest asset management groups, risk management and advisory services company, BlackRock threw an olive branch to Reichen. The most direct feeling is that Ruiyun is expected to become China's Starbucks.

But can Rachel really be the next Starbucks? Heavy users of

coffee may say that the taste and quality of Ruisheng coffee is difficult to pass.

In fact, it is absurd to discuss the quality and taste of coffee at such a low price of Rachel, just as we seldom discuss the "good to drink" of a five-dollar glass of bulk wine. The coffee market is huge and can be divided into many levels. Ruixin is on the low-end performance-to-price route, but not the real low-end; the market positioning is no problem. Fortunately, we should not pursue "good taste", which is the stage for boutique coffee shops. In addition to creating the world's strongest chain coffee, Starbucks has created what is known as the "third space" Starbucks'corporate culture, which emphasizes more on connecting and communicating with customers. Many of the stores are "small facades", which is obviously not comparable to the full range of services offered by Starbucks.

Looking back at Ruixing's prospectus, as of March 31 this year, the number of Ruixing's coffee shops has reached 2370, of which 2193 are Cafe stores and 91.3% are Cafe stores.

Ruixing emphasizes the whole scene, but at present the main force is Cafe stores. It's hard to cover the cost of a delivery store at a low price, and it's clear that Starbucks is a strong competitor in social space. Starbucks relies on coffee culture and social networking, Richard relies on Internet thinking to expand, it should pursue operational efficiency, after all, any e-commerce and new retail business is ultimately won by operation.

With taste, quality and brand, Ruiyun can't see the beginning in a short period of time. Only relying on subsidies to quickly occupy the market has been tried and tried. As a direct force of the Shenzhou system, such a team of Farayun can't get along well with others. The tactic of

has been rejected by the industry, but it is also an important grasp for Ruixing to gain a piece of the fast-growing coffee market in China. The binding of

Richard and Starbucks does not mean that Richard is like the second Starbucks. In fact, the two do not constitute homogeneous competition. In fact, the so-called "standard Starbucks" is more a means of public relations communication.

02

Will Rachel be the next ofo? Will Rachel be the next ofo?

Reicheng CEO Answer: No, we don't accept deposit. This answer invisibly sprinkles a handful of salt on the wounds of countless ofo users waiting for a deposit refund.

单从商业逻辑上看,瑞幸和共享单车有许多相似之处,即重补贴、养成用户习惯、聚拢流量,然后做高估值上市套现。

Because of the large-scale subsidies in the previous period, according to the data from the prospectus, the net income of Ruisheng coffee in 2018 was 840 million yuan, with a net loss of 1.62 billion yuan; as of March 31 this year, the net income was 480 million yuan, with a net loss of 550 million yuan. If Rachel doesn't go to the U.S. for an IPO at this moment, it may be the end of ofo that greets them.

is just a happy run before, and then an ofo deposit door, which makes countless people resent the expansion of money burning, but another typical use of capital to burn the market alive and successfully rise, at least in marketing promotion, Internet thinking, monopoly, traffic scale effect... It really teaches people a lesson. < p > < p > but is Rachel the same as ofo?

In fact, the two are comparable only at the level of huge losses, but the coffee market and the travel market are very different. They are completely different things. As if ofo had fought with Mobai to kill you, and no matter how provocative Rachel was, Starbucks would not fight the price war

Rachel also knew that they burned money not to kill Starbucks and boutique cafes, so that the people of the country only drank Rachel's coffee, but to share a considerable share in this incremental market. After all, compared with the number of more than 100,000 cafes in the country, the number of stores Ruisheng reached last year is only less than 2%. This year, another year, the proportion is expected to be about 4%. Unlike sharing bicycles with public attributes, cafes are hardly subject to social or government constraints, and there is no place to limit the number of Ruisheng cafes. Fortunately, even if people die from burning too much money, no one will use such language as cheaters and scoundrels. On the contrary, many people will regret that they can't drink convenient and cheap coffee.

Of course, the industry uses ofo as an analogy to Reicheng, focusing mainly on whether Reicheng will burn too much money like ofo, and eventually no one will take the dish and mix it up and die. The Internet industry is stunned by the unprecedented speed of Ruisheng's listing. Unfortunately, Ruisheng did not catch up with ofo, but when Ruisheng coffee went up, the whole capital market was going downhill.

is different from the business model of sharing bicycles at a glance and a pool of stagnant water. Rachel's imagination space still exists. As long as we overcome the two difficulties of efficiency and cost, Rachel will have a chance.

03

Where does Ruiyun go?

Up to now, Ruixing Coffee has received $550 million in financing, equivalent to about RMB 3.6 billion, but has lost more than 2.2 billion yuan in the past two years. Under the current size of stores and the strength of subsidies, the funds it holds are not sufficient. Ruixing's anxious to go public now should be unfavorable in financing and want to find more funds.

Even though the current financial situation of Rachel is still difficult to avoid being reminded of ofo, Rachel's money burning is not just "money burning". According to the prospectus, as of March 31, 2019, the acquisition cost of Ruixing's new customers dropped from 103.5 yuan in the first quarter of 2018 to 16.9 yuan in the first quarter of 2019; the promotion cost was 6.9 yuan, compared with 15.8 yuan in the same period last year, which means that the acquisition cost of Ruixing's new customers is greatly reduced. The rapid expansion of Ruisheng is closely related to the prospects of the whole coffee market.

According to the Investment Analysis and Prospect Forecast Report of China Coffee Industry in 2017-2021 published by China Consulting Investment Network, the annual growth rate of coffee consumption in China is 15% to 20%. Obviously, the market is still growing rapidly. After

gained brand recognition through coffee, Ruixing no longer focused on coffee. While providing core products and services, it is constantly enriching its products, trying to meet the needs of different levels of users. This is very similar to Xiaomi's way of playing, relying on mobile phones to occupy a certain share in the early stage, and then constantly launching mobile phone peripherals and smart home products, in fact, Xiaomi's route and Ruixing now have much in common.

You know, millet mobile phones do not make money, and now rely on the Mijia ecological chain to make profits, so for Ruixing, it can also be completely coffee does not make money, rely on light food and milk tea to make profits.

Although these categories are not directly related, the ultimate goal is to meet the different needs of the same target group. On the one hand, it provides users with more choices, on the other hand, it also brings a more comprehensive way of profit for Ruixing itself. When we really start to make profits, Ruisheng will no longer be a "burning money" model, and there will be more profitable aspects waiting for Ruisheng to explore.

For Reichen Coffee, the listing is not the end, and more stories need to be told by the unicorn less than two years old.