Introduction:When the braised food giant Juewei Food quietly launched milk tea in its stores, it garnered widespread public attention. Under the pressure of slowing braised food consumption and declining revenue, is this cross-industry move a breakthrough for seeking new growth or a high-risk gamble? This article delves into Juewei’s strategic layout and the practical challenges it faces by examining store realities, market performance, and consumer feedback.

Once famed for its duck necks, “the king of braised food” Juewei Food has now put up milk tea signs in some of its stores, sparking heated market discussions. As milk tea has become a daily staple for many young people, while braised food remains an occasional snack, whether Juewei can truly tap into a new customer base through this cross-industry venture has become a focal point of market attention.

Not only are netizens actively discussing on social platforms, but the hashtag #JueweiStartsSellingMilkTea has also trended on hot search lists. Some consumers have shared store photos showing prominent promotional banners at certain Juewei duck neck outlets advertising “Get 3 cups of original leaf milk tea for 11.9 yuan,” which has piqued the curiosity of many and drawn them in for a try.

According to on-site visits, some Juewei stores in Changsha have been offering milk tea for over a month, with decent sales performance. Currently, about four to five Juewei stores in Changsha sell milk tea products. On Juewei’s mini program, two new products have also been listed: “Red Bean Pudding” and “Coconut Burst Green Milk,” both standard 473 ml cups priced uniformly at 7 yuan each — an affordable price point.

This cross-industry strategy has not only surprised duck neck fans but also drawn the attention of the entire braised food industry. Is the combination of “duck neck + milk tea” a bold innovation by the leading brand in the braised food sector, or an uncertain bet amid a sluggish market?

For Juewei, this cross-industry move is not just an experiment but is also seen by the market as an attempt to find new growth points for the brand. Chain operation experts point out that with its tens of thousands of stores and a huge customer base, Juewei has inherent advantages in introducing milk tea products and can quickly expand its market reach.

However, Juewei’s recent operational performance has not been optimistic. In the first quarter of 2024, Juewei Food reported revenue of 3.34 billion yuan, a year-on-year decline of 9.73%. The brand officially attributed this mainly to a drop in sales volume. The capital market’s response was even more direct: over the past year, its stock price has plummeted from around 35 yuan per share to approximately 12 yuan, a significant drop. Its market value has shrunk to about 7.5 billion yuan, evaporating nearly 90%, and it has dropped out of the hundred-billion-yuan club.

Not only is the stock price low, but the number of stores has also continued to shrink. According to the 2024 mid-year report, Juewei had a total of 14,969 stores in mainland China, a net decrease of 981 from the end of last year. The rate of store closures has exceeded the combined total of major competitors such as Zhou Hei Ya and Huang Shang Huang.

Consumer complaints about Juewei have also been increasing, especially regarding noticeable price hikes. Since 2022, the brand has raised prices on some products, including a 5% increase at the beginning of the year and a 7% to 10% hike on items like duck feet in the middle of the year. Many netizens have expressed their discontent, saying things like “just buying a little costs over 50 yuan,” “15 yuan only gets you eight pieces of duck neck,” or “the price is even higher than beef,” leading to the viral term “duck neck assassin.”

Aside from pricing, product quality and service have also been frequently criticized. Some consumers have commented, “It’s getting worse and worse, I haven’t bought it in ages,” or “The portions used to be generous, but now the quality is inconsistent, and sometimes you even get stale ones.” There were even reports of “fresh and stale products being sold together,” greatly affecting the overall consumption experience.

Faced with these various challenges, Juewei has chosen milk tea as a new way out, but analysts generally hold a cautious view. Although the number of stores is large, most individual locations have limited space and find it difficult to additionally install professional beverage-making equipment for milk tea. Moreover, compared to professional tea drink brands in the market, Juewei still shows significant gaps in tea ingredient supply chains, product R&D, and flavor diversity. How to stand out in the fiercely competitive tea drink market will be a crucial question Juewei urgently needs to answer.

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