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this is a machine revolution in the tea circle. In the face of more expensive labor, more expensive raw materials, weak consumption and repeated epidemics, tea has focused on machines, systems and AI. But like an orthopedic surgery, evolution and upgrading will inevitably be accompanied by labor pains.
A fierce exchange took place at Naixue headquarters.
Standing in front of Zhao Lin, chairman of Naixue tea, and Peng Xin, founder of Naixue tea, is Deng bin, founder and chief operating officer of Naixue tea. He argued excitedly with Zhao Lin: “Mr. Zhao, over the years, this is the most wrong decision you have made!”
More than ten minutes ago, Zhao Lin communicated his latest idea with Deng Bin: in order to accelerate the digital construction of Naixue, the chief operating officer needs to report directly to He Gang, the chief technical officer.
In June 2020, He Gang, who worked in Amazon, Shanda and Ruixing, joined Naixue. In order to persuade he Gang to join, Zhao Lin and Peng Xin personally called him many times. Naixue even gave a “price tag” that the tea circle could not refuse: at that time, He Gang hoped to be able to obtain the authority to form a team freely and lead many old subordinates to join the team. At that time, it was unheard of in the tea circle to “incorporate expensive technical teams into an organizational system”.
An informed person told Hu OLF that in the history of Naixue, there has never been a department like “it team” that “asks for money, asks people to give people, and asks permission to give permission”. The reason why Zhao Lin and Peng Xin attach such importance to He Gang and his team is that the epidemic has made “online” the lifeline of Naixue; At the same time, the traditional operation mode of “large-scale artificial” has been difficult to support Naixue’s future expansion.
However, He Gang was accompanied not only by the expensive it team, but also by the rewriting of the architecture and business flow, which was like a “cosmetic and orthopedic surgery”: in the process of upgrading and evolution, the pain was never absent.
In Chengdu, 1699 kilometers away from the headquarters of Naixue in Shenzhen, another “upheaval” occurred in the headquarters of a local chain tea brand.
The person in charge of digital business, who was invited by the founder from Shanghai at a high price, left the company “in a temper” after serving for more than five months. The dispute between the two sides stems from “different expectations”: the technical expert from Shanghai was surprised to find that what he was facing was almost “frontier” — he was used to working in a mature platform company, where all the details would be solved by professionals, and he only needed to focus on the lifeline and core technology. In the tea company, he even had to personally solve such trivial problems as “excel table macro calculation” and “look at the printer by the way”.
“Taiyuan is too backward. It has not even solved the problems of standardization and informatization. It is in the primary stage of digitization, let alone intellectualization.” This person in the digital industry who once worked for a tea brand in Chengdu told Hu smell that although tea, coffee and catering belong to the category of big catering, compared with coffee and catering, most of the tea chain brands are in the “primary” digital stage.
A similar situation occurred in Changsha.
A well-known tea chain brand in Huguang region finally established its own digital team in 2021. But at the beginning
“Foreign large-scale coffee or beverage chains often start to build digitalization in the middle of their development. The digitization process of local new tea drinks is different from that of international famous brands. Affected by the epidemic and market environment, they need to complete the journey of international famous brands in a shorter time and more efficiently.” Zhao Chengcheng, an analyst, said to huwen that the digital construction of foreign famous brands is more like slow work and long-term flow; However, domestic tea brands do not have such a leisurely space. It is more like “speed of life and death”.
And in the view of some head brands, digitization not only affects today, but also concerns the future.
“The epidemic has caused irreversible changes in consumers’ habits. After the epidemic is over, users’ habits will not return.” Peng Xin told Hu OLF that she and Zhao Lin have a very clear consensus: if there is no breakthrough in digitization, Naixue will “stop” 2000 stores. “Frankly speaking, digitization is the most important guarantee factor for Naixue to go from QianDian to WanDian.”
However, for the tea circle that highly relies on manual and traditional mode, it is not easy to switch from traditional mode to digital mode.
“It’s very dangerous to attract people with anxiety.” The above-mentioned insiders working for Chengdu tea brands said that all tea brands now realize that digital transformation has changed from “optional” to “mandatory”, “Under pressure and anxiety, some brands may blindly embark on digital projects or entrust non-human things. In essence, the number one of tea brands does not want to understand what core problems they need to solve digitally. In the final analysis, digitization is ultimately a number one project.”
Moreover, for professionals who are engaged in the tea industry, promoting digitalization in this circuit is also full of challenges. Before he Gang joined the company, he once told Peng Xin and Zhao Lin that “digitizing in the tea circle is not easy.” As a result, after joining the company, He Gang soon encountered a “blow”: he was surprised to find that unlike highly standardized coffee, the tea drinking circle has not even completed the standardization construction.
“There is still a big difference between tea and coffee, but at least when you look at it from a height of 1000 meters, it is exactly the same. The most critical step is standardization, then digitization, automation and intelligence. What is standardization? It is the standardization of business processes and business specifications.” He Gang told Hu OLF that the digitization of the whole tea chain is very low. After joining Naixue in 2020, he found that the digitization pain points of Naixue are “everywhere”, which means that he needs to rebuild the digital system of Naixue from the basic links in a shorter time.
Photo source: Naixue’s tea
From “lianguoduan” to “deep water area”
As early as 2018-2019, Naixue has started its own “digital transformation strategy”. However, during this period, many of Naixue’s “tools and functions” were deeply dependent on third-party software.
With the rapid development of business, this mode is gradually difficult to sustain: before the epidemic in 2020, Naixue had accumulated more than 10 million members, about 500 stores and more than 10000 partners (store employees) in the private domain. “A lot of management
In internal communication, he gang used a word called “the end of the same pot”: to completely replace all the suppliers’ things as quickly as possible, but not add new things for the time being. At the same time of one-to-one replacement, the IT department will get through the data linkage of the new software, and in the process, it is necessary to guard against data loss at any time. “This is a high-risk action, and you need to replace it a little bit carefully. For example, if you change the system for a store, because there are too many stores, it is difficult to complete the replacement overnight. As a result, some stores are still on the old system, and some stores are already using the new system.”
In six months, he gang led the IT department to complete the replacement of all systems and software. “Replacing supplier products is to fundamentally solve three key pain points. First, the supplier based system is very unstable, for example, small programs are prone to failure. Second, if you have any needs, the supplier’s response is very slow, and it will slowly advance you on a monthly basis. Third, there is a serious data island problem.” He Gang believes that there is a kind of “pseudo connection” on the issue of data islands: sometimes the supplier’s systems and software can be “barely connected” in operation, but it is very easy to lose fields and data when the data is really transmitted, and it is impossible to pull multi-end data into the same BI system for deep analysis.
Photo source: Naixue’s tea
After completing the system replacement, He Gang started the second phase of transformation. “At this time, we really entered the deep water area. In fact, up to today, Naixue’s digital transformation is still in this deep water area stage.”
He Gang described it as: first, realize digital coverage, covering all businesses including store management, supply chain management, store location, design engineering, and company OA.
He Gang divided Naixue’s digital system into three parts:
The first is a small program and app for end customers. This part is the system “visible to the naked eye” of users. This part is called “transaction marketing” in Naixue.
The second is the management system of Naixue store. Store management is divided into personnel management, machine management and material management. On the manager’s side, the digital system covers recruitment, training, employment and attendance. On the side of the management machine, there are POS machines, cash registers, display screens, etc., as well as data linkage of various ports. In the management of goods, a very important part is ordering. Since there are hundreds of SKUs in Naixue store, it is necessary to solve the complex goods management problems, and the digital system also needs to cover daily, weekly and monthly discs. In the whole process, the key is how to optimize the cost and improve the efficiency through digital means.
The third is the supply chain management of Naixue. This part includes procurement, logistics and cost control. And, we should solve the complex and complicated food validity and food safety problems through digital means.
After the coverage is completed, automation and intellectualization shall be carried out. Automation is to solve the problem of manual operation, reduce the dependence on people through equipment and systems, and improve efficiency through machines; And intellectualization needs a lot of manpower
After completing software replacement and process sorting, how to implement “automation” through technical means becomes the key to Naixue’s transformation. Before joining the company, Zhao Lin and Peng Xin expressed to He Gang their desire to create “automation equipment”.
In 2019, one year before he just joined Naixue, Naixue began to try to build automatic machines. At that time, Naixue’s business department tried to find relevant machines in the market, but found that no supplier could produce machines that meet Naixue’s demands.
Unlike the coffee market, the world’s top coffee machines are basically produced in Switzerland, where there are a large number of high-quality suppliers. However, in the tea circle, because the tea production process is more complicated and the raw materials involved are more complicated, most tea brands’ demands for production equipment are “more personalized”, which makes it difficult for manufacturers to launch general-purpose equipment suitable for all brands.
“At the end of December 2020, after the system and software were replaced one by one, I was ready to upgrade and add things. After a round of research, I found that automation equipment is really the most deadly problem of Naixue.” Before and after the Spring Festival of 2021, He Gang set up a team in the IT department to specifically establish automation equipment.
At the beginning, He Gang wanted to try the “OEM mode”: designed by Naixue IT department and produced by the partner. The prototype was successfully produced around October 2021. As a result, the OEM began to “blackmail” the price.
At that time, the OEM proposed a purchase price of about 60000 yuan for a machine to Naixue, which greatly exceeded the budget of Naixue. The IT Department of Naixue estimated the cost and found that the real cost was only about 30000 yuan. “We are stuck. The OEM thinks that Naixue will cooperate with them.”
Considering the cost and space for subsequent upgrading, He Gang finally decided to produce the prototype himself. In the second half of 2021, he recruited a dedicated hardware team.
“If you don’t have the core technology in your hand, you’ll get stuck.” Based on its own team of hardware engineers, Naixue began to build machines from 0. What impressed He Gang was that compared with the partners, the response speed and investment of his team were greatly improved. After fully observing the actual use scenarios of the store business, Naixue’s hardware engineers changed the design scheme.
About half a year later, Naixue IT department created the second generation of automatic equipment. Compared with the prototype in October 2021, the production speed was significantly improved: from the previous one cup of tea / 20 seconds to one cup of tea / 7 seconds. “Like the problem of software suppliers, we should build our own team and grasp the core technology in our own hands.”
The automatic milk tea machine has solved the key pain point for Naixue: the turnover rate of the store.
Because the formulas of different SKUs of Naixue are very different, store employees will be required to recite the formulas, and the company will also conduct regular assessment. Many Naixue employees left because they could not memorize the formula. Since 2020, Naixue has improved the updating speed of SKU, which means that the pressure on employees to recite has increased sharply, and a large number of employees are worried about reciting formulas.
When the automatic milk tea machine was put into the store, the situation changed significantly, and Naixue employees no longer need to recite the formula.
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