从“网红品牌”到“又贵又难吃” 老乡鸡离上市还有多远？

This article outlines the current situation of Chinese fast-food brand Laoxiangji, which has failed to go public five times in five years, and breaks down the core issues behind its setbacks. Key takeaways are as follows:

1. Laoxiangji’s development history: Founded in Hefei, Anhui in 2003 originally under the name Feixi Old Chicken, the brand officially changed its name to Laoxiangji in 2012. It went viral in 2020 after tearing up employees’ salary-cut petitions during the COVID-19 pandemic and hosting a "down-to-earth" press conference that cost only 200 yuan, establishing itself as a viral national fast-food brand.

2. Current reputation and operating performance: Consumers’ top complaints about Laoxiangji are small portion sizes, high prices and underwhelming taste. After related negative topics went viral in 2023, the brand only cut prices by roughly 2 yuan, which failed to reverse its negative reputation. In recent years, its revenue and net profit growth have continued to decline, and its gross margin has long stayed below 25% – far lower than the industry average. Its valuation has shrunk by nearly half in four years, and its path to an IPO remains unclear.

This article draws key lessons for Chinese fast-food brands from Laoxiangji’s failed IPO attempts. Core takeaways are as follows:

1. Brand marketing: Laoxiangji successfully broke into mainstream awareness through emotional marketing and low-cost "down-to-earth" viral campaigns, but failed to sustain its popularity. This demonstrates that viral brands must back up their marketing buzz with matching product strength to retain consumer goodwill; marketing alone cannot sustain long-term customer loyalty.

2. Pricing and competition: Laoxiangji’s heavy-asset model drove up costs, pushing its pricing beyond consumer expectations, and a small price cut failed to repair its reputation. This serves as a reminder that brand pricing must align with consumer perception and meet consumer demand for value for money.

3. Industry outlook: China’s Chinese fast-food track continues to grow in scale, and is expected to exceed 300 billion yuan by 2025, but the industry has entered an era of thin profit margins. Rapid franchise expansion will leave hidden risks for brand development if a profitable unit-economy model has not been validated first.

This article clearly outlines the current state, opportunities and risks of China’s Chinese fast-food track, offering valuable insights for food service sellers. Key takeaways are as follows:

1. Market opportunities: Chinese rice fast food is a growing market driven by rigid demand. It reached 277 billion yuan in 2024, up 10.2% year-on-year, and is projected to exceed 300 billion yuan in 2025. The sector boasts high overall consumer traffic, and average store revenue continues to climb, leaving room for new growth.

2. Risk warnings: The industry has entered an era of thin profit margins and remains extremely fragmented. Even the market leader holds only a 0.9% market share, making competition extremely intense. Compliance issues such as social insurance contributions and food safety are critical vulnerabilities that can derail a brand’s path to capitalization and even disrupt normal operations.

3. Actionable lessons: A full-supply-chain heavy-asset model tends to drive up costs and drag down gross margins. Franchise expansion requires validating a profitable unit-economy model first, rather than blind store expansion. Marketing-driven buzz must be matched by product quality and value for money, otherwise consumers will churn quickly.

This article analyzes the current state of China’s Chinese fast-food industry, offering key references for factories in the food service supply chain. Core takeaways are as follows:

1. Product demand: Chinese fast-food brands generally pursue standardization and cost control today. Most have adopted an asset-light model by outsourcing ingredient procurement and third-party warehousing and distribution, creating strong demand for standardized ingredient supplies and stable quality control from third-party factories. This opens clear commercial opportunities for specialized supply chain factories.

2. Demand growth trends: Leading Chinese fast-food brands including Laoxiangji are rapidly expanding their store networks via franchising, and the overall track continues to grow in scale. This has lifted demand for upstream links including ingredient production, packaging and logistics support, continuously expanding the overall market space.

3. Strategic insights: Laoxiangji’s vertically integrated heavy-asset model drove up costs and led to chronically weak profitability, demonstrating that specialized division of labor is a more efficient path. Factories can lean into their own production advantages, provide standardized products for food service brands, and grow alongside the expansion of the Chinese fast-food track, while aligning with brands’ requirements for cost control and compliance.

This article identifies the current development trends and core pain points of China’s Chinese fast-food industry, offering valuable references for food service-related service providers to capture market demand. Key takeaways are as follows:

1. Industry development trends: The Chinese fast-food track is growing steadily in scale, and brands are in a transition from direct operation to franchise expansion. Most brands have capitalization goals, and as the industry enters an era of thin margins, demand for cost reduction, efficiency improvement and compliant operations is extremely strong.

2. Core client pain points: First, many brands lack sufficient franchise system management capabilities after rapid expansion, and struggle to build a profitable unit-economy model. Second, many brands fail to control costs effectively, with gross margins far below the industry average, and face compliance issues such as unpaid social insurance that threaten their capitalization plans. Third, many viral marketing-driven brands fail to match their marketing buzz with positive product reputation, and cannot meet consumer demand for value for money.

3. Strategic business directions: Service providers can develop targeted franchise management systems to help brands maintain store quality, launch supply chain optimization services to help brands cut costs, and offer compliance consulting services to meet the regulatory requirements for public listing.

This article outlines the industry development and capitalization status of China’s Chinese fast-food track, offering references for related platforms on investment attraction, operations and risk mitigation. Core takeaways are as follows:

1. Core demands from brands: Most leading Chinese fast-food brands have strong capitalization demand and have repeatedly attempted to go public, and they expect capital markets to adjust their review frameworks to fit the industry’s characteristics. During expansion, brands also need platforms to provide support in areas including franchise operation management and supply chain resource matching.

2. Investment attraction and operation directions: The Chinese fast-food track boasts stable overall growth, abundant high-quality brand resources and large room for investment attraction. However, platforms need to adjust their brand screening criteria: instead of focusing solely on store count, they should prioritize evaluating the sustainability of store profitability, franchise management capabilities, supply chain barriers and compliance rectification status to select truly high-quality brands.

3. Risk mitigation: The Chinese fast-food industry is characterized by market fragmentation, high standardization difficulties, clear regional growth ceilings and thin profit margins. Platforms should guard against the risk of brands overstating their value purely based on scale, pay close attention to compliance issues such as unpaid social insurance and food safety, and maintain a cautious attitude toward brands that expand rapidly but suffer from unprofitable store-level operations.

This article uses Laoxiangji’s five failed IPO attempts as a case study to analyze the new development trends and capitalization dilemmas of China’s current Chinese fast-food industry, offering high value for industrial research. Core takeaways are as follows:

1. New industry trends: China’s Chinese rice fast-food track continues to grow in scale, and is expected to exceed 300 billion yuan by 2025. The industry as a whole has entered an era of thin margins, with a large number of brands pursuing capitalization. However, no major Chinese fast-food brand has successfully gone public yet, a sharp contrast to the capitalization boom for tea beverage brands that makes this a noteworthy new phenomenon for research.

2. Key emerging issues: The industry itself is characterized by extreme fragmentation, high standardization difficulties and clear regional growth ceilings. At the brand level, common problems include inflated costs from heavy-asset models, rapid franchise expansion paired with unproven unit-level profitability, long unresolved compliance issues, and a mismatch between marketing hype and product strength. Capital markets have also shifted their review frameworks, and no longer reward pure growth-by-scale narratives, instead prioritizing core profitability.

3. Research implications: The capitalization path and optimal business model for Chinese fast-food remain to be explored. Brands need to find a balance between consumers’ demand for high value for money and sustainable corporate profitability, while regulators could also optimize review standards to fit the unique characteristics of the Chinese fast-food industry.