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China Brands & Marketing

Hotpot Chain Haidilao Is Shutting Down Over 300 Restaurants

After adding 544 stores in 2020, Haidilao will close 300 locations this year.

Manya Koetse

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News that China’s most popular hotpot chain is closing down over 300 restaurants became a top trending topic on Chinese social media site Weibo on Friday.

Haidilao (海底捞) made the announcement on Friday evening through a social media post, saying the company will gradually shut down about 300 of its stores. The restaurants that are to be closed are those with relatively low customer traffic and lower-than-expected business performance.

Although the stores will be shut down before December 31 of this year, some of them will potentially reopen at a later date after reorganization. The company also said it would not lay off its staff for now.

Haidilao has approximately 1600 restaurants, of which many were opened in 2020, when the chain added an astonishing 544 new restaurants. In the summer of 2021, Haidilao had a total of 131,084 employees.

It has been over 25 years since Zhang Yong, the owner of Haidilao, set up his first hot pot restaurant in Jianyang, Sichuan, with a mere investment of 10,000 yuan ($1470). It later became the dominant hot pot chain in the country.

Hot pot restaurants, where fresh meat and vegetables are cooked at the table in the simmering broth, are extremely common across China. But Zhang Yong chose to market Haidilao and its authentic Sichuan hot pot with an innovative strategy: high-service, high-tech, and high-quality.

The restaurant is known for giving its customers a free manicure along with snacks and drinks while waiting for a table. The staff is thoroughly trained in providing the best customer service, and Haidilao has introduced new concepts throughout the years to enhance customer experience. People who dine alone, for example, will get a teddy bear to join them. The restaurant also introduced robot waiters and is known for its noodle dancers and staff singing birthday songs whenever there is a birthday celebration.

Want a bear to join you for hotpot? Haidilao’s got you covered.

Over the past two years, however, Haidilao’s table turnover rate shrunk dramatically. The average table turnover rate in 2019 was 4.8 per day, but that number fell to 3 times per day in 2021, with some restaurants only doing 2.3 per day, leading to significant losses for the company’s net profit.

Due to the Covid19 crisis and lockdowns, Haidilao closed its doors in late January of 2020. By mid-March, it started to gradually reopen some of its locations, although they initially offered fewer seats and introduced an increased distance between dining table, that were allowed to have no more than three guests.

Due to the restaurant’s limited tables and increased labor costs, its menu prices went up, much to the dismay of many netizens, who already thought the prices at Haidilao were steep before the pandemic.

In October of this year, the story of a Haidilao customer in Zhengzhou discovering that the 200 grams of tripe he ordered for 72rmb ($11) was actually only 138 grams also went viral on Weibo, stirring discussions on the Haidilao menu prices.

While news about Haidilao closing so many of its stores attracted over 260 million views by Friday night, many commenters agreed that the company should scale down. “The more stores you open, the less you focus on service, the surroundings of the newly opened stores are not up to par, while prices are only rising,” one person wrote on Weibo.

“They’re not making enough money, while their prices were already being pressed down, and still I can’t afford to eat there,” another commenter wrote.

Others also wondered how Haidilao could claim they would not sack their staff while closing down so many stores. “Does that basically mean they’ll wait for them to leave for themselves?”

“When there’s a pandemic, there’s bound to be bad luck [in business],” another commenter writes: “There’s really not much to do about it.”

By Manya Koetse

Spotted a mistake or want to add something? Please let us know in comments below or email us. First-time commenters, please be patient – we will have to manually approve your comment before it appears.

©2021 Whatsonweibo. All rights reserved. Do not reproduce our content without permission – you can contact us at info@whatsonweibo.com.

Manya Koetse is the founder and editor-in-chief of whatsonweibo.com. She is a writer, public speaker, and researcher (Sinologist, MPhil) on social trends, digital developments, and new media in an ever-changing China, with a focus on Chinese society, pop culture, and gender issues. She shares her love for hotpot on hotpotambassador.com. Contact at manya@whatsonweibo.com, or follow on Twitter.

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1 Comment

1 Comment

  1. Avatar

    Jin Wang

    November 6, 2021 at 10:31 am

    with the increase of labor cost in China, only profitable restaurant will be open.
    Restaurant with financial problems will be closed.

    (great website)

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China Brands & Marketing

About Lipstick King’s Comeback and His ‘Mysterious’ Disappearance

After Li Jiaqi’s return to livestreaming, the ‘tank cake incident’ has become the elephant in the room on social media.

Manya Koetse

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Earlier this week, the return of China’s famous livestreamer Li Jiaqi, also known as the ‘Lipstick King’, became a hot topic on Chinese social media where his three-month ‘disappearance’ from the social commerce scene triggered online discussions.

He is known as Austin Li, Lipstick King, or Lipstick Brother, but most of all he is known as one of China’s most successful e-commerce livestreaming hosts.

After being offline for over 100 days, Li Jiaqi (李佳琦) finally came back and did a livestreaming session on September 20th, attracting over 60 million viewers and selling over $17 million in products.

The 30-year-old beauty influencer, a former L’Oreal beauty consultant, rose to fame in 2017 after he became a successful livestreamer focusing on lipstick and other beauty products.

Li broke several records during his live streaming career. In 2018, he broke the Guinness World Record for “the most lipstick applications in 30 seconds.” He once sold 15000 lipsticks in 5 minutes, and also managed to apply 380 different lipsticks in another seven-hour live stream session. Li made international headlines in 2021 when he sold $1.9 billion in goods during a 12-hour-long promotion livestream for Alibaba’s shopping festival.

But during a Taobao livestream on June 3rd of this year, something peculiar happened. After Li Jiaqi and his co-host introduced an interestingly shaped chocolate cake – which seemed to resemble a tank, – a male assistant in the back mentioned something about the sound of shooting coming from a tank (“坦克突突”).

Although Li Jiaqi and the others laughed about the comment, Li also seemed a bit unsure and the woman next to him then said: “Stay tuned for 23:00 to see if Li Jiaqi and I will still be in this position.”

The session then suddenly stopped, and at 23:38 that night Li wrote on Weibo that the channel was experiencing some “technical problems.”

But those “technical problems” lasted, and Li did not come back. His June 3rd post about the technical problems would be the last one on his Weibo account for the months to come.

The ‘cake tank incident’ (坦克蛋糕事件) occurred on the night before June 4, the 33rd anniversary of the violent crackdown of the Tiananmen student demonstrations. The iconic image of the so-called ‘tank man‘ blocking the tanks at Tiananmen has become world famous and is censored on China’s internet. The control of information flows is especially strict before and on June 4, making Li’s ‘tank cake incident’ all the more controversial.

But no official media nor the official Li Jiaqi accounts acknowledged the tank cake incident, and his absence remained unexplained. Meanwhile, there was a silent acknowledgment among netizens that the reason Li was not coming online anymore was related to the ‘tank cake incident.’

During Li’s long hiatus, fans flocked to his Weibo page where they left thousands of messages.

“I’m afraid people have been plotting against you,” many commenters wrote, suggesting that the cake was deliberately introduced by someone else during the livestream as a way to commemorate June 4.

Many fans also expressed their appreciation of Li, saying how watching his streams helped them cope with depression or cheered them up during hard times. “What would we do without you?” some wrote. Even after 80 days without Li Jiaqi’s livestreams, people still commented: “I am waiting for you every day.”

On September 21st, Li Jiaqi finally – and somewhat quietly – returned and some people said they were moved to see their lipstick hero return to the livestream scene.

Although many were overjoyed with Li’s return, it also triggered more conversations on why he had disappeared and what happened to him during the 3+ months of absence. “He talked about a sensitive topic,” one commenter said when a Weibo user asked about Li’s disappearance.

One self-media accountpublished a video titled “Li Jiaqi has returned.” The voiceover repeatedly asks why Li would have disappeared and even speculates about what might have caused it, without once mentioning the tank cake.

“This cracks me up,” one commenter wrote: “On the outside we all know what’s going on, on the inside there’s no information whatsoever.”

“It’s tacit mutual understanding,” some wrote. “It’s the elephant in the room,” others said.

Some people, however, did not care about discussing Li’s disappearance at all anymore and just expressed joy about seeing him again: “It’s like seeing a good friend after being apart for a long time.”

By Manya Koetse 

Elements in the featured image by @karishea and @kaffeebart.

 

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China and Covid19

Happiest Lockdown in China: Guests Undergo Mandatory Quarantine at Shanghai Disneyland Hotel

“I wish I could be quarantined at Disney too!” The Shanghai Disney hotel apparently is the happiest place to get locked in.

Manya Koetse

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While many cities across China are experiencing new (partial) lockdowns and millions of people are confined to their homes, there was also a group of people that had to undergo mandatory quarantine at a very special place: the Shanghai Disneyland Hotel.

On September 7, social media posts started surfacing online from people who said they were required to quarantine while they were at the Shanghai Disneyland hotel. Disneyland reportedly had received a notification from the local health authorities that a visitor who previously stayed at the Disneyland hotel was found to be a close contact of a newly confirmed Covid case.

In line with the Center for Disease Control requirements, Disney created a ‘closed loop system’ by locking in all hotel residents and staff members and doing daily Covid tests. While the Disneyland theme park was open as usual, the hotel became a temporary isolation site where people’s health would be monitored for the next few days while all staff members would also be screened.

During their mandatory quarantine, guests stayed at the hotel for free and did not need to pay for their rooms. Room prices at the Shanghai Disneyland hotel start at around 3000 yuan/night ($433).

Some guests shared photos of their Disneyland quarantine stay on social media, showing how Disney staff provided them with free breakfast, lunch, a surprise afternoon tea, delicious dinner, fun snacks, and Disney toys and stickers.

On the Little Red Book (Xiaohongshu) app, one Shanghai Disney visitor (nickname @恶霸小提莫) wrote: “We have three meals a day, there is both Chinese and Western-style breakfast, we also get afternoon tea and desserts, they have shrimp, beef, scallops, drinks, French macarons, yogurt, ice cream, and much more. We watched so many Disney movies for free. We are given so many little gifts, they brought us gifts twice today as they also brought us toy figures at night. We watch the fireworks from our windows every night at 8.30 pm. Although we weren’t allowed to go out, we really had a pleasant stay.”

Another Disney guest named Zoea (Xiaohongshu ID: yiya0313) also shared many photos of the mandatory quarantine and wrote: “When the staff knocked on the door to tell me they were bringing dinner, I even wondered how it was possible that they brought food again. Afternoon tea during quarantine, can you believe it? And fruit before dinner? And midnight snacks brought to us after dinner? And it was so nice to watch all the Disney movies on tv. Disney really is the most magical place.”

“I’m just so happy,” another locked-in Disney guest posted on social media, sharing pictures of Mickey Mouse cakes.

Other guests also posted about their experiences on social media. “They probably feared we would get bored so they brought us glue, stickers, and painting brushes, the kids loved it and so did we!”

Reading about the happy quarantine at Disney, many Weibo users responded that they envied the guests, writing: “I wish I could be quarantined at Disney too.”

“I need to find a way to get in, too,” others wrote.

Earlier this year, one Chinese woman shared her story of being quarantined inside a hotpot restaurant for three days. Although many people also envied the woman, who could eat all she wanted during her stay, she later said she felt like she had enough hotpot for the rest of her life.

By Manya Koetse 

 

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