As players in the coffee sector announce their farewell to the 9.9 yuan "price war," local Western fast food giant Wallace has launched a 9.9 yuan WA coffee monthly card to stir the market with an extremely low price.

According to information from Wallace's official WeChat account, the pilot program for this activity will start at the end of 2025 and will be fully rolled out in February 2026, with approximately ten thousand stores nationwide participating. After spending 9.9 yuan to purchase the card, users can redeem a classic Americano (hot/iced) for free every 2 hours (during business hours) within 30 days, with a maximum of 7 cups per day and 210 cups per month, translating to a cost of less than 0.05 yuan per cup.

At the same time, Wallace has set clear usage restrictions: orders can only be placed through the mini-program within 200 meters of the store, meaning users must go to the store, which largely mitigates the issue of proxy ordering; the activity only supports the Americano product, with lattes, iced Americanos, and others excluded; only one cup can be redeemed every 2 hours, and refills require a higher time cost. It is evident that Wallace is both compressing the "sheep shearing" space and driving in-store traffic to boost consumption of main products like fried chicken and hamburgers.

On-site visits by reporters found that the distance restriction is enforced clearly and strictly, as even orders placed from 298 meters away from the store cannot be completed; coffee is served quickly, but the actual cup size is relatively small, estimated at about 200ml. According to staff, there has been a recent increase in people purchasing the coffee monthly card, and the enthusiasm for picking up orders in-store is quite high.

Left Yu/Photo

This move has sparked polarized feedback on social media, with some workers exclaiming they have achieved "coffee freedom," even compiling "sheep shearing" strategies; while others complain about the complicated rules, bland taste, and high in-store costs.

This extreme traffic-driving strategy comes at a critical transformation period for Wallace, as its growth slows and capital exits. Its parent company, Huashi Food, will terminate its listing on the New Third Board on February 12, 2026, ending its journey in the capital market.

The last financial report before delisting showed that in the first half of 2025, Huashi Food's revenue was 4.625 billion yuan, a slight decrease of 0.49% year-on-year, marking the first negative growth in nearly five years; during the same period, net profit attributable to the parent company was 122 million yuan, a year-on-year increase of 35.32%. The significant profit increase mainly came from cost reductions rather than revenue expansion, as the company's advertising expenses were reduced, and sales expenses dropped from 863 million yuan in the same period last year to 644 million yuan, a decrease of over 200 million yuan, with a reduction rate of about 25%.

Looking at a longer time frame, the company's growth momentum has clearly weakened, with revenue growth rate gradually declining from 64.44% in 2021 to 13.31% in 2024.

In the Western fast food industry, where Wallace wins with cost performance, its profit model is also relatively fragile. In the first half of 2025, Huashi Food's gross profit margin was 6.04%, compared to 6.61% for the entire year of 2024, with operating costs accounting for a high proportion of revenue; the net profit margin was only 2.63%, significantly lower than Yum China (09987.HK), which had a gross profit margin of 22.47% and a net profit margin of 9.47% during the same period Sun Wanqiu / Photo

The scale of stores has shifted from expansion to contraction.

According to Narrow Door Restaurant Eye data, as of March 3, Wallace had 19,494 operating stores, with 1,405 stores closed in the past year, a closure rate of 7.21%, and a net decrease of 513 stores in the past year; the average customer spending per order is about 17 yuan, positioning itself in the sinking market with extreme cost performance, with about 40% of stores located in residential communities and 30% as street-side shops. However, Wallace has long been plagued by quality control controversies, being mockingly referred to by netizens as "Jet Warrior," with high levels of food safety complaints.

Narrow Door Restaurant Eye platform data

The Black Cat Complaint platform shows that the number of complaints related to Wallace has reached 8,376, involving issues such as undercooked meat, foreign objects, and stale food. It is worth mentioning that recently, several consumers have complained on the platform about the WA coffee monthly card being unusable and issues with the mini-program.

Chinese food industry analyst Zhu Danpeng told reporters that Wallace's launch of the coffee monthly card is essentially "low-price traffic generation," using high-frequency, low-margin coffee products to attract nearby foot traffic and boost sales of core store products. "Coffee has the characteristics of high traffic, high standardization, and strong replicability, which is also the core reason why many companies are crossing into coffee."

However, in the long run, low-priced coffee can only temporarily boost traffic and is unlikely to solve core issues such as low margins, quality control, and slowing store expansion.

Reporter: Zuo Yu

Text Editor: Sun Wanqiu