Multiple Tea Brands Jointly Boycott Delivery Platform Discounts, Sparking Widespread Online Criticism

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According to media reports, yesterday, multiple tea beverage brands jointly boycotted the discount promotions on food delivery platforms, including well-known brands such as Heytea, Nayuki, Chabaidao, Guming, Mixue Bingcheng, and Shuyi. Currently, the delivery platform discounts have all been changed to 50-1, 70-1 or directly cancelled.

This news sparked heated discussion among netizens. The topic "#MultipleTeaBrandsBoycottDeliveryDiscounts" quickly topped the trending lists on Weibo, Baidu, and other interactive platforms. As of now, the topic has reached 180 million views on Weibo.

In a short video from Wuhuan, a merchant confirmed that this is indeed true. "Starting November 1st, it was a company-wide requirement, including well-known brands like Heytea, Nayuki, Guming, and others that have all unified." The shop owner said: "Business is difficult now, with very little profit." Meanwhile, netizens commented: "Here's a joke: milk tea sellers have no profit."

Many netizens complained: "A cup of milk tea costs thirty to forty yuan, and they're still not making any profit???", "I suggest this industry just shut down", "A cup of milk tea costs over 20 yuan, but my monthly electricity bill is only 50 yuan", "Many delivery orders are already more expensive than in-store purchases, and now they're boycotting discounts, how shameless", "10 yuan in-store, 12 yuan for delivery, minimum order 20 yuan, forced to order two cups and still complaining about low profits, are the merchants okay..." and so on...

However, some netizens believe the fundamental reason is that merchants aren't making profits, yet platforms continue to offer various coupons and discounts, stating "The delivery platform commissions are too harsh, making it extremely difficult for merchants during the pandemic." Some merchants also shared screenshots in comments showing their frustration, where after customers used coupons, the expected revenue for the order became zero yuan.

The Changing Tea Beverage Market

As the new tea beverage market "cools down," many new tea brands have begun to attract consumers through price reduction strategies. In early 2022, Heytea took the lead in implementing price cuts, followed closely by Nayuki, while Lele Tea also made adjustments to its products. Although price reduction strategies can attract consumers, they may have truly further compressed the profit margins of new tea beverages.

In April this year, Nayuki released its 2021 fiscal year annual report, showing that the brand lost 4.525 billion yuan in 2021, an increase of 2141.27% year-on-year. Another brand, Mixue Bingcheng, makes profits every year, but according to its prospectus, its main revenue sources come from selling ingredients and collecting franchise fees. Additionally, Heytea, which has always insisted on self-operation, has begun to relax its stance and will launch business partnership operations in non-first-tier cities with suitable store formats. At the same time, Heytea also completely closed its sub-brand "Heytea Go."

Consumer vs. Merchant Perspectives

Honestly speaking, from a consumer's perspective, although many brands have implemented price reduction strategies, it feels like they've gone from making 15 yuan per cup to now making 10 yuan? After all, looking at just the ingredients and cost of a cup of milk tea, 20 yuan per cup is indeed very expensive. Making the same milk tea at home not only uses real ingredients and is healthier, but the cost per cup is much cheaper than buying it outside.

But if we consider it from a merchant's perspective, selling milk tea requires opening a store, store decoration, rent, as well as franchise fees, labor costs, raw material procurement fees, and other miscellaneous expenses that need to be calculated. These costs are eventually spread across each cup of tea and marked up with a certain price to generate profit. If it's a delivery order, then delivery fees and platform commissions must also be calculated. If the delivery platform commissions are high, the profit left for merchants becomes even smaller.

Image source: Internet

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