Introduction:Once regarded as a regional brand that could hardly expand beyond Changsha, Cha Yan Yue Se (Chagee) announced its entry into Chongqing and Nanjing in 2024 following employee salary disputes and internal management turmoil. This article delves into the brand’s transformation journey—from navigating public relations crises and adjusting its high-density store expansion strategy to gradually moving into the Jiangsu-Zhejiang-Shanghai market—analyzing the real challenges it faces and the operational adjustments it has made, providing in-depth insights for readers interested in the development of tea beverage brands.

Cha Yan Yue Se was once dismissed by the industry as unlikely to break through regional limitations and expand beyond the Changsha market. Especially at the end of last year, several employees publicly complained on social platforms about earning less than 3,000 yuan per month in actual salary, drawing widespread attention. Founder Lü Liang emphasized externally that salaries were distributed according to workload and even directly contacted some employees asking them to resign. This unconventional PR approach only intensified the conflict, with related topics repeatedly trending on social media.

As the number of employees involved in the dispute grew, the brand grew concerned about further reputational damage and urgently clarified that the low income of some employees was due to changes in the salary calculation method. Subsequently, Lü Liang also issued an internal apology statement. Despite the brand’s public apology, the incident still exposed the significant operational pressures Cha Yan Yue Se is facing. Industry insiders analyzed that the issues might be related to the overly dense distribution of stores in Changsha, and pointed out shortcomings in salary structure, management capability, and supply chain that could hinder its national expansion. Lü Liang had even admitted at the FBI2020 Food & Beverage Innovation Forum: “It’s not that Cha Yan Yue Se doesn’t want to expand outward, but going out might actually lead to failure.”

In fact, prior to this, Cha Yan Yue Se had attempted to expand beyond Changsha, but only to nearby cities such as Wuhan and Changde. Its furthest attempt was in Shenzhen, but only in the form of pop-up stores, which exited the market after just three months. This shows that leaving the familiar Changsha market, Cha Yan Yue Se faces multiple challenges and has yet to achieve any substantial breakthrough.

Just when the public generally believed the brand would remain confined to Changsha for the long term, on April 2, 2024, Cha Yan Yue Se officially announced: “Next stop, Chongqing,” and planned to open four stores at once, with expected openings after June 1. The news excited many local fans in Chongqing, and the brand also broke the industry’s prophecy that it “couldn’t go far” with concrete actions.

Regarding this truly cross-regional expansion, the public speculated whether Cha Yan Yue Se would continue to layout even more distant markets. At the time, the brand responded that subsequent plans were still under evaluation, and while entering provinces such as Sichuan and Jiangsu was not ruled out, priority would be given to assessing the team’s execution capability and making decisions based on comprehensive feedback.

This response, however, actually hid an important piece of information. On June 15 of the same year, Cha Yan Yue Se officially announced that it would launch in Nanjing in August, marking the brand’s first entry into the Jiangsu-Zhejiang-Shanghai region. After the news broke, consumers in Shanghai expressed envy and even called on the brand to accelerate its layout in Shanghai, considering that it’s only about a two-hour drive from Nanjing to Shanghai.

Looking back, Cha Yan Yue Se has also realized the problems brought by blind expansion in Changsha and publicly stated that it would adjust its earlier high-density store opening strategy. “Decisions made out of overexpansion are like having water in your brain—really stupid,” said the brand. It decided to close some stores in Changsha that were overly densely located and underperforming, aiming to enter new markets with a leaner approach.

The above content is compiled by CoffeeHunters, a coffee news website.