“ if the equity litigation expenses are excluded, Ruixing coffee has actually been profitable in the second quarter. Why did Ruixing, once at a low ebb, complete her magnificent turn in such a short time? ”Ruixing is completing a counter attack.On August 4, an article by FRISO alenus, a Wall Street analyst, ignited the catering circuit. Analysts said that since 2022, despite the impact of the epidemic, the global economic headwind and the global market sell-off, the performance of Ruixing coffee still far exceeds the standard & Poor’s index (spy) and Starbucks.The analyst especially pointed out that the number of Ruixing coffee stores has expanded rapidly, and in fact it has become the largest coffee chain brand in China.On August 8, Ruixing announced the Q2 financial report of 2022. The financial report also confirmed the judgment of the above analysts.According to the financial report of Ruixing, in the second quarter of 2022, the total revenue of Ruixing coffee reached 3.299 billion yuan, a sharp increase of 72.4% over the second quarter of 2021, of which the sales growth rate of self operated stores was 41.2%, and the profit rate of self operated stores was 30.6%.While the revenue data is encouraging, what makes investors more happy is that the total number of stores of Ruixing coffee has far exceeded that of Starbucks, and in the overall business level, Ruixing coffee has a tendency to narrow the gap with Starbucks.Ruixing, who once fell into a low ebb due to the financial fraud, why did he complete such a magnificent turn?
The number of monthly average trading customers increased sharply
The most important indicators to measure Internet e-commerce are the number of monthly activities and the number of daily activities. For the Internet based catering enterprises such as Ruixing coffee, the measurement indicator is of course the average number of monthly trading customers.According to the financial report, in the second quarter of 2022, the average number of monthly trading customers of Ruixing coffee reached 20.7 million, with a year-on-year increase of 68.6%. Facing the gratifying situation that the average number of monthly trading customers increased by nearly 70%, it may indicate that Ruixing coffee is gradually coming out of the shadow and beginning to be accepted by consumers with high-quality products and services.Thanks to its advantages, Ruixing coffee is also sought after in the capital market. As Ruixing coffee has been delisted from Nasdaq, but the increase of lkncy at the beginning of the session expanded, and it rose by more than 11.7% in the powder list market, reaching US $15.56. This is also the highest daily increase of Ruixing coffee in the powder list market. Based on the share price, the total market value of Ruixing coffee has reached US $4.5 billion.Xu Yi, an analyst in the financial industry, believes that during the epidemic period, especially when the first tier cities such as Beijing and Shanghai, the main markets of Ruixing coffee, were affected by the epidemic, it is really rare to achieve such results.Xu Yi pointed out: “it is obvious that Ruixing’s Q2 financial report is higher than the market expectation. Under the circumstances that many industries and enterprises are struggling to survive under the epidemic, Ruixing has handed over such an answer sheet that is almost faultless. Although Ruixing still has some problems, it is slowAlso under the influence of the epidemic, Ruixing coffee achieved an increase of 72.4% in the Chinese market, while Starbucks directly decreased by 40% year-on-year. Based on the Chinese market, the total revenue of Starbucks in the Chinese market is 540 million US dollars, about 3.645 billion yuan, only 346 million yuan more than Ruixing coffee.But don’t forget that Starbucks entered the Chinese market in 1999, and Ruixing coffee was just established in June 2017. Compared with the international major brands that have been deeply engaged in the Chinese market for 23 years, Ruixing coffee is more like a challenger of rising stars. It is almost like a counter attack to be on the same level with Starbucks in just five years. In addition, the development of Ruixing coffee has been delayed for two years due to the financial turmoil in the past five years.Chen Meng, a coffee shop operator in the UK, thinks that it is very common for Starbucks to fail to beat local brands. Such things also happen in the UK. Even in the UK, Starbucks only ranks third in market share, lagging behind local brands Costa and Greggs.By the end of 2021, the number of Starbucks stores in the United Kingdom was 1025, the number of British local coffee brand Costa was 2681, the number of Greggs stores was 2078, and the number of Starbucks stores was less than half of them.Chen Meng also believes that such a situation is particularly unusual in China, because British consumers generally have the habit of drinking coffee, and there is a large consumer market. It is very normal for local coffee brands to rise. People who drink coffee in China are not very common. As a local coffee chain brand in China, Ruixing coffee is not easy to surpass Starbucks in just a few years.From the perspective of active users, Starbucks takes a high-end route, and the number of active users in the country is only 4 million at the peak. It is worth noting that the latest second quarter report of Starbucks shows that its active users have halved to 2 million, and it competes with the monthly active users of Ruixing coffee with more than 20 million people. Even if the customer price of Starbucks is much higher than Ruixing coffee, it is difficult to fight. The balance of the first domestic coffee brand is gradually tilting toward Ruixing coffee.From the perspective of single store output, Starbucks also performs poorly in the Chinese market. Starbucks has 5761 stores in China, accounting for 36.6% of 15650 in the US market, but its revenue only accounts for 9.6% of the US market. The average store output in the Chinese market is US $93734, about RMB 623000. The average store output in the US market is US $359100, about RMB 2424000. The output of Starbucks in the Chinese market is 25.7% of that in the US.In the second quarter, the total revenue of Ruixing coffee was 3.299 billion yuan, the total number of stores was 7195, and the average single store output was 459000 yuan, accounting for 74% of Starbucks. The difference is not obvious. Moreover, considering the area and geographical location of Starbucks, the floor efficiency per square meter of Ruixing coffee is significantly higher than that of Starbucks.Chen Meng pointed out:Ruixing coffee now has all the equipment connected to the Internet of things. The advantage of this is that the headquarters can understand the equipment status in real time, reduce the impact of the equipment on the production products, and obtain the minimum index of the profit of the store through big data analysis, so as to maximize the floor efficiency. For example, through the Internet of things, it can be concluded that the average store only needs to sell 200 cups a day to make a profit, while Starbucks stores need to sell at least 400 cups a day to make a profit.In addition, Ruixing coffee completely connected the supply chain is also a key factor. It is reported that Ruixing coffee’s second coffee roasting plant (Kunshan plant) has signed an investment agreement in the second quarter, with a design capacity of 30000 tons. In addition to reducing costs by investing in the construction of a coffee plant, Ruixing coffee can also become an industrial supplier. Under the situation of widely promising coffee market prospects, Ruixing coffee has completely solved the supply chain problems.Liu Bo, an investor, was deeply impressed by the standardization of Ruixing coffee. Liu Bo pointed out: “Ruixing coffee is served every 2 minutes, which is very powerful. This is related to the hot drinking characteristics of coffee. The Internet of things can minimize the cost of Ruixing coffee and maximize the profit. This is also the key to the profit of Ruixing coffee in the last two quarters.”Liu Bo believes that the small shop model of Ruixing coffee is flexible, low cost and high output, which is also a major reason for its profit. What Liu Bo admires most is the importance that Ruixing coffee attaches to private traffic.According to the annual report data of Ruixing coffee in 2021, Ruixing coffee has established nearly 10000 user welfare groups throughout the country, and has chosen to use enterprise wechat as its private domain and community. Among them, there are nearly 2 million private domain users, and they are still increasing.“The customer stickiness of private traffic is very great. It can connect with enterprise wechat through wechat group, and even realize user tag identification. Ruixing coffee has made great contributions to the development of private traffic today, but Starbucks has always been unable to put down its position to do private traffic. When it realized the importance of private traffic, it was actually too late.” The private domain traffic mentioned by Liu Bo has a great impact on Ruixing coffee and has become the third largest order source after app and applet.Ruixing official said that through private domain traffic, the monthly consumption frequency of users increased by 30%, the number of weekly re purchases increased by 28%, and the Mau increased by about 10%. Now, in terms of private domain traffic, users have placed more than 35000 orders. If they pass the reminder, they will promote more than 100000 orders again. The daily increment of Ruixing coffee through private domain traffic is equivalent to 14 more cups per store.“There are few ultra-low discounts for Ruixing coffee now, and the previous promotion of 20% and 30% has almost disappeared. However, by reducing its own costs, paying attention to private domain traffic, and quickly allowing consumers to drink steaming coffee in a standardized way, it can fully attract consumers and it is natural to make money.” Liu Bo is optimistic about the future profit model of Ruixing coffee.Still can’t rest easyRuixing’s development momentum is so rapid, isn’t itIn recent years, Starbucks stores are mostly in the third tier and lower cities, which shows that Starbucks has also begun to explore the market. Especially when the underdeveloped cities in the north and northwest of China have large penetration space, the penetration competition of the sinking market is equally important. However, in terms of the number of stores, Starbucks can not compete with Ruixing coffee. The scale of Starbucks’ stores is much higher than Ruixing coffee. The “small quick spirit” store model of Ruixing is conducive to rapid expansion.“Consumers have their own fixed consumption habits. The Internet characteristics of Ruixing coffee make its brand effect obvious. It is very difficult for coffee brands behind to snatch people from consumers who have formed consumption habits.” Gaopei believes that as long as Ruixing coffee maintains a sense of crisis and does not make major mistakes, it is difficult for those emerging brands to shake its position.Completion of debt restructuring and countdown to listingRuixing achieved such brilliant results in Q2, and the debt restructuring laid a solid foundation for the rapid development in the second quarter.It is reported that the company completed the debt restructuring in the first quarter and made substantial progress in the handling of class actions of overseas shareholders. The completion of the debt restructuring marks that Ruixing’s settlement of the US federal class action lawsuit has recently been finally approved by the US federal court, which means that most of the potential risks of the class action of foreign shareholders have been released. Ruixing may be re listed in the US stock market or A-share market and kill the capital market again.On April 11, 2022, Ruixing announced that it had successfully completed financial debt restructuring and was no longer subject to bankruptcy or insolvency proceedings in any jurisdiction. On the same day, Guo Jinyi, chairman and CEO of Ruixing coffee, said that with the support of creditors, Ruixing coffee ended its bankruptcy proceedings as a debtor. He emphasized that “today marks the new beginning of Ruixing coffee”. It can be seen that debt restructuring is of great significance to Ruixing coffee.“If the debt restructuring cannot be completed, Ruixing will not be listed again. Now that the debt restructuring has been completed, it will relieve the concerns of many investors and greatly promote the re listing of Ruixing. The new CFO of Ruixing is most likely to be prepared for the listing.” Liu Zhigang, the investor, has a better understanding of Jingjing, the new CFO of Ruixing. Jingjing served as the CFO of Lanxun communication, 58 home and Swan home from 2014 to 2020.Liu Zhigang stressed: “Both 58 home and Swan home have gone public. At this time, the CFO is changing and the possibility of Ruixing coffee being re listed is increasing. From the current perspective, the basic conditions for the conversion of Ruixing coffee are: to meet the requirements of net assets, market value, circulating shares, minimum stock price of $4 in 90 trading days, more than 300 shareholders, and more than three market makers. These conditions are no longer difficult for Ruixing coffee and have been met.”Guo Jinyi also made it clear at the telephone conference that he hoped that the quiet participation would enable Ruixing to develop to a new level. As for whether the new stage refers to the listing, I believe the answer will be revealed soon. Ruixing coffee will be re listed or has entered the countdown.As Wall Street analysts said, RuixingRuixing, why are you making more and more money?此外，瑞幸咖啡完全打通了供应链也是关键因素。据悉瑞幸咖啡第二家咖啡烘焙工厂（昆山工厂）已于第二季度签订完成了投资协议，设计产能 3 万吨，瑞幸咖啡通过投资建设咖啡工厂来降低成本之外，还可以成为产业供应商，在咖啡市场前景被广泛看好的形势下，彻底解决了供应链难题。投资人刘波对瑞幸咖啡的标准化印象深刻。刘波指出：“瑞幸咖啡2分钟一单，这点很厉害，这和咖啡的热饮特性有关，而物联网化，能让瑞幸咖啡的成本降到最低，能实现利润的最大化，这也是瑞幸咖啡最近两个季度实现盈利的关键所在。” 刘波认为，瑞幸咖啡所走的小店模式机动灵活，成本低而产出高，也是其盈利的一大原因。最让刘波推崇的是瑞幸咖啡对私域流量的重视。根据2021年瑞幸咖啡年报数据可知，瑞幸咖啡在全国范围内建立了近万个用户福利群，并选择用企业微信做私域和社群，其中私域用户已近200万人，且还在持续不断增加之中。“私域流量的客户粘性极大，可以通过微信群和企业微信对接，甚至可以实现用户标签识别，瑞幸咖啡能有今日的发展，私域流量功不可没，而星巴克始终放不下身段来做私域流量，当意识到私域流量的重要性时，其实已经晚了。”刘波所说的私域流量对瑞幸咖啡影响确实很大，已经成为继APP和小程序后的第三大订单来源。瑞幸官方曾表示，通过私域流量，用户的月消费频次提升了30%，周复购人数提升了28%，MAU提升了10%左右。如今，在私域流量方面，用户下单超过3.5万杯，如果通过提醒信息后，还会再度促单10万杯以上。瑞幸咖啡每天通过私域流量带来的增量相当于每个门店多出14杯。“瑞幸咖啡现在的超低优惠已经很少，以前2折3折的的促销现在几乎消失了，但通过降低自身成本，重视私域流量，以标准化的方式快速让消费者喝上冒着热气的咖啡，这完全能吸引消费者，赚钱也是理所当然的。”刘波对瑞幸咖啡未来的盈利模式持乐观态度。
