---
title: "NAYUKI completely \"puts down its ego\" | Insights from Dolphin Research"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/109354383.md"
description: "Brands aiming to expand rapidly are feeling anxious, NAYUKI can't afford to wait any longer."
datetime: "2024-03-06T12:17:35.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/109354383.md)
  - [en](https://longbridge.com/en/news/109354383.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/109354383.md)
---

> Supported Languages: [简体中文](https://longbridge.com/zh-CN/news/109354383.md) | [繁體中文](https://longbridge.com/zh-HK/news/109354383.md)


# NAYUKI completely "puts down its ego" | Insights from Dolphin Research

The war of new tea drinks will escalate after the Chinese New Year.

NAYUKI, known as the "conservative" in the franchise industry, has announced a new round of franchise policies. The single-store investment has been reduced from the previous 980,000 to almost half, at 580,000 yuan. Moreover, if the store contract is completed before June 30, 2024, a subsidy package of 60,000 yuan per store can be stacked.

The significant reduction in the threshold for joining the franchise has amazed the market. The "top premium milk tea brand" has finally completely lowered its stance.

From sticking to self-operation to cautious exploration to complete openness, what has NAYUKI experienced? Can the "latecomer" NAYUKI catch up with HEYTEA and Royaltea in the future?

## **Competing for Franchisees with HEYTEA and Royaltea**

There was a time when direct operation was the proud business model of high-end milk tea brands, with "high quality" and "high B grade" as the main selling points. However, as the average customer spending gradually decreased, cases of rapid expansion and profitability through franchising, such as HEYTEA, Royaltea, and others, emerged, breaking this situation.

Starting from the second half of 2023, HEYTEA and NAYUKI successively "lowered their stance" and opened up franchising, officially ushering in the era of franchising in the new tea drink industry.

However, different franchise thresholds and operating styles have led them to completely different expansion paths.

In terms of franchise conditions, NAYUKI is the most demanding, with its franchise fee being the highest among the 9 major tea drink brands and 3 major coffee brands, more than 500,000 yuan higher than HEYTEA and nearly 400,000 yuan higher than Royaltea.

Specifically, although not charging a franchise fee, NAYUKI's equipment and decoration costs far exceed other brands, about three times that of HEYTEA. Clearly, **although NAYUKI has opened up franchising, it still leans towards conservatism overall, not sacrificing store area and decoration quality for the purpose of rapid expansion.**

**However, the high franchise fee has actually constrained the speed of store openings.** For comparison, after the first 8 months of opening up franchising, NAYUKI had over 200 franchise stores opened, while HEYTEA had over 1000 franchise stores opened after the first 9 months of opening up franchising.

**The reduction in franchise threshold by NAYUKI this time is expected to change this current situation.**

Looking at the changes in franchise policies, when franchising was first opened, NAYUKI required **store area** to be between 90-170 square meters. In the latest franchise terms, this requirement has been reduced to **a minimum of 40 square meters**, while HEYTEA requires a minimum of 50 square meters. In the single-store cooperation model, franchisees need to provide proof of liquid assets of 1.5 million yuan or more, while the amount of funds and asset proof for regional cooperation is 4.5 million yuan or more. In the latest franchise terms, the **funds and asset proof** amounts for single-store and multi-store cooperation have been reduced to **80,000 yuan or more** and **200,000 yuan or more** respectively.

The reduction in franchise fees and requirements undoubtedly makes NAYUKI more competitive in the franchise market. On the one hand, the decrease in storefront area is conducive to the densification and penetration of NAYUKI outlets;

On the other hand, the reduction in franchise fees from 980,000 yuan to 580,000 yuan has placed NAYUKI in the same price range as competitors such as NAYUKI and King Tea Princess, making it easier for franchisees who were previously constrained by financial limitations to surpass NAYUKI's high threshold and now may be more inclined towards NAYUKI's strong brand appeal.

According to research by Wall Street Wisdom, NAYUKI's franchise stores have performed better than expected. Among the 200-plus franchise stores that have opened, those in third- and fourth-tier cities such as Hulunbuir in Inner Mongolia, Beihai in Guangxi, Shangqiu in Henan, and Longyan in Fujian have performed exceptionally well, with multi-store monthly revenues exceeding 700,000 yuan and holiday revenues exceeding 450,000 yuan; over 300 locations have been selected, with over 1,000 people paying a 100,000 yuan deposit, indicating that the release of the new policy is also conducive to attracting franchisees who are still on the sidelines.

**However, the competitive landscape among new tea beverage brands is now vastly different, with the premium between brands significantly narrowing.**

## **NAYUKI Can't Afford to Wait**

**The problem this brings is that NAYUKI's daily sales per store continue to decline, with little sign of improvement.**

Since HEYTEA and NAYUKI lowered their prices, intense competition has unfolded in the 10-15 yuan price range for new tea beverages. According to feedback from franchisees, King Tea Princess still maintains a high brand popularity in top-tier cities and has seized many prime locations through rapid store openings, even surpassing the impact on NAYUKI compared to HEYTEA.

It is not ruled out that under the pressure from competitors and the situation of diluting customer traffic by accelerating store expansion, NAYUKI's daily sales per store continue to decline.

(NAYUKI's daily sales per store continue to decline, data source: Futu NiuNiu)

Secondly, **all competitors have been aggressively expanding their store networks in recent years.** Not only did HEYTEA add 2,000 new stores in 2023, but early second-tier brands such as Gumeng, Chabaida, and Auntie in Shanghai are also aiming for tens of thousands of stores, with no reduction in their expansion ambitions. \*\*At the beginning of the year, Chabaida, Gumeng, and Auntie in Shanghai all submitted IPO applications, adding fuel to the fire for the goal of tens of thousands of stores. In addition, this year, **HEYTEA, Chabaidao, and Shuyi Shaoxiancao have coincidentally launched various preferential policies to reduce the franchise threshold.**

-   **HEYTEA:** In the first quarter of 2024, the cooperation fee for new signings is completely waived; partners who sign and open businesses in the first half of the year can receive a decoration subsidy of 66,000 RMB after opening 3 stores; stores that have been open for one month during the year can receive a performance guarantee subsidy.
    
-   **Chabaidao:** From February to May, new franchisees who sign up for 1 store will receive a discount of 40,000 RMB, and those who sign up for 2 stores will receive a cumulative discount of 180,000 RMB. In terms of store location selection, franchisees in core business districts, strategic locations, and large stores will receive discounts ranging from 90,000 to 100,000 RMB per store.
    
-   **Shuyi Shaoxiancao:** Zero brand fee, zero cooperation fee, and zero service fee; the total budget for opening a franchise city store has been reduced from 190,000 to 137,000 RMB.
    

In the eyes of industry experts, these brands undoubtedly lower the franchise threshold in order to **accelerate expansion within their respective tiers. This not only reduces costs through economies of scale but also positions them more favorably in the market share battle.**

Among them, HEYTEA and Bawang Chaji are both in the first tier. HEYTEA's preferential policies aim to seize the lower-tier market; Chabaidao aims to narrow the gap with Guming stores in scale and strive to be the first to sprint to ten thousand stores; while Shuyi Shaoxiancao is trying to reverse the downward trend in brand momentum in the fierce competition.

Even brands aiming to reach ten thousand stores are feeling anxious, NAYUKI can't afford to wait any longer.

### Related Stocks

- [NAYUKI (02150.HK)](https://longbridge.com/en/quote/02150.HK.md)

## Related News & Research

- [Midea Soars After Chinese Home Appliance Giant Unveils Record Share Buyback Plan](https://longbridge.com/en/news/281150788.md)
- [Sichuan Baicha Baidao Tightens Audit Committee Rules to Bolster Governance](https://longbridge.com/en/news/280778447.md)
- [Midea Unveils the H-Pack at MCE 2026: A Major Step Forward in Affordable Compact Heat Pump Technology and Service](https://longbridge.com/en/news/281210504.md)
- [J.P. Morgan Reaffirms Their Buy Rating on Guming Holdings Ltd. (1364)](https://longbridge.com/en/news/281099124.md)
- [Orient Securities Keeps Their Buy Rating on Tencent Music Entertainment Group Class A (1698)](https://longbridge.com/en/news/280960163.md)