The social animals who work 996 may all have a dream of being a boss in their hearts. One day fire the boss, their own business, no longer have to listen to the command, no longer have to be nailed by the sound of the midnight awakening.
All the things to the staff to take care of, they just need to lie down every day to count money on the line.
For the average person who is not yet financially free, opening a small store without much investment is the best choice. And now the hottest, most common, than the milk tea store. The Internet is saying that the milk tea industry is profitable, as long as there is a certain amount of initial investment, the later can sit and count the money.
But I want to tell you, these are false. The result of going to open a store, the probability is to lose money.
1
Open a milk tea store, much more expensive than you think
Let’s do the math. First of all, the cost of opening a store before you have to decide whether to create your own store or join. Considering that the average person does not have the relevant knowledge, choosing to join is a more reliable choice.
However, joining is not an easy task. Every time you pass by the hi tea, Nesher’s tea, you can see the long queue, you can not help but fantasize that you open the store can also be so hot. But unfortunately, they are directly operated model, do not allow to join.
Then take a step back, choose a little and Coco total line, right?
Coco first look Coco, want to join only the regional authorization of this form, can not only join a store, must contract a whole region. How big is this area, the number of permanent residents of one million for an authorized area.
And the number of stores also have requirements, the first year you need to prepare to open 5-10 stores of money, within 3 years to open to 15 stores, which requires a large amount of initial funds.
And money alone is not enough, Coco requires partners with extensive work experience and management experience. No contact with the milk tea industry is no chance for newcomers.
And then look at a little bit, this can finally join the single store. But the cost of opening a store is not low.
A little bit of the official website shows that the cost of opening a store about 40-60 million yuan, not including store rent and staff salaries. Gu Ming milk tea is a little cheaper, but also close to 300,000 yuan.
And how much does the store rent cost? To make money, the location of the store is crucial. If you open in a prime location with high traffic, such as a commercial street in a first-tier city, you will undoubtedly have higher income, but the rent will be more expensive in comparison.
One study found that the average rent for stores on a total of 100 commercial streets in 15 key cities in China was 25.9 yuan/square meter-per-day [5]. Assuming your milk tea store has 15 square meters, the monthly rent would be 11,655 yuan.
When you have taken care of all the prep work, you cannot open yet because you need manpower. Take a little bit for example, the front desk and back kitchen together need 5 employees. If you as the store manager can be responsible for one of these roles, then you also need to hire 4 store employees.
And the salary of milk tea store employees, 4,000 yuan per month is the minimum level [7]. Even at the minimum wage, these 4 employees would add up to 16,000 RMB per month.
In addition, the depreciation cost of fixed assets is also a cost, and the wear and tear of equipment should be evenly spread over the period of use. Take Gu Ming as an example, the cost of the machine is 70,000 yuan, the milk tea machine can generally be used for 3 years, according to the average life method, the monthly average cost is 1,945 yuan.
The above is a rough calculation of the various costs needed to open a store, the real situation is more complicated. Now, let’s calculate the profit.
Some people say that opening a milk tea store is profitable, but this “profitable” is not the net profit, but simply the selling price of a cup of milk tea minus the cost price to calculate, without considering other costs.
The monthly revenue of a milk tea store belongs to the main business income.
The cost of milk tea not only includes the cost of raw materials such as milk, tea and pearls, but also includes labor costs, rent, utilities, equipment depreciation and other operating expenses and taxes, all of which are subtracted to make net profit.
The rent in the example is 11,655 yuan, depreciation expense is 1,945 yuan, and the staff salary is 16,000 yuan, which adds up to nearly 30,000 yuan.
In other words, not all the money you make from selling milk tea goes into your pocket, you have to subtract 30,000 yuan and pay the taxes, and the rest is the money you make.
If you sell less than 30,000 yuan of milk tea income per month, then not only do not make money, but also lose money.
A report by China Merchants Securities shows that the net profit margin of mature milk tea stores is only 10%-15%, far below the 90% windfall that people speculate.
Why is this so? Isn’t it said that the milk tea industry is profitable?
2
Why milk tea stores are not profitable
Looking at the current popular products of milk tea stores, it is not difficult to find that the menu of each brand is similar. Fruit tea, cheese fruit tea, pearl milk tea …… are just a few, and the similarity of milk tea makes it hard to tell the difference between brands.
Naixue’s tea founder Peng Xin had sent out a circle of friends, pointing directly to Xie tea copied Naixue products, publicly calling out Xie tea founder Nie Yunchen.
Why do people want to open a milk tea store? Naturally because it is easy and does not require any professional skills. But the problem also comes with a low threshold, which means that anyone can do it.
If a milk tea store has a good profit margin, it is a light in the dark forest, which is bound to attract the attention of a large number of businessmen to enter the game.
Currently you can join the milk tea brands, more than 20 brands have more than 1,000 stores, the most honey snow ice city is open to the horror of 5,000 stores.
The American group data show that only from 2016 to 2018, the number of milk tea stores in the country has increased by 74%, and in 18 years there have been more than 400,000 tea drinking stores nationwide.
Tea drinking stores in first-tier cities tend to be saturated, with a 29% net increase in stores in the second quarter of 2018 compared to the same period the previous year [8].
Take Taikoo Li Sanlitun, one of the must-visit trendy places in Beijing, for example, the average daily traffic in Taikoo Li Sanlitun before the epidemic could reach 100,000 people. However, the competition in this prime location is also fierce, with no less than 10 milk tea stores in just a 1 km radius of the shopping area.
Hei tea, a little bit, coco Duke, Deerhorn Lane, Royal Tea, Happy Lemon, and Kurotaki Taro …… are all trying to get a piece of the pie in the busiest part of Beijing, whether it is a national chain of well-known brands or a small store that is not yet famous [10].
Milk tea stores are growing by leaps and bounds, but consumer demand will not follow. The survey shows that the average monthly number of cups of tea purchased by consumers is concentrated in the range of 5 cups to 14 cups, accounting for 83%; the average monthly consumption of 15 cups and above accounts for only 11% of users [11].
In addition to peer competition, all kinds of snack stores, fast food restaurants and coffee shops have also launched their own milk tea: McDonald’s so big pearl milk tea, KFC’s Bobo buttermilk tea, RuiXing coffee’s XiaoLu tea, and even Gluttony Gluttony have opened a tea store in front of the hot pot store to sell hand-shaken tea.
The “Meituan Takeaway Milk Tea True Fragrance Consumption Report” shows that the number of merchants supplying milk tea on the Meituan takeaway platform in 2018 has grown threefold, and there are even many restaurants that add milk tea to their menus to attract traffic.
The milk tea industry has long been a red sea with extremely fierce competition. The number of milk tea stores opening and closing is not small, and according to data from Meituan Dianping, the number of drinks stores closing began to grow gradually from the second half of 2015.
By the first half of 2017, the number of closed stores has exceeded the number of open stores by 28%. 2017 milk tea opened 96,000 stores, the number of closed stores is as high as 78,000, sustainable operation for more than a year of milk tea stores is only 18.8%.
If you do not understand the market, come over to open a store only to find that you can not make money, it really want to cry.
In the end, open milk tea store profiteering is a false proposition, full competition in the market, no industry is profitable. Franchisees can earn franchise fees, only earn, not lose, the people who opened the store may not.
3
Milk tea store, not who can open
If you feel hard to work, do not want to work for others, and then listen to others say open milk tea store to make money, a hot head to come, then I advise you to calm.
Which industry is not hard work? Want to be your own boss, but how easy it is?
Open a small store, the scale is not large, want to open a good is not simple. Part-time jobs only need to be good at one ability, while being a boss requires the ability of all aspects.
For example, payroll for employees. People who work just have to wait for their paychecks to arrive, while the boss has much more trouble with payroll.
First of all, the salary paid to the employees is not the full cost, because there is also five insurance and one fund to pay to the employees.
Own business to open a milk tea store, belongs to the nature of individual business. According to the relevant regulations, you have to take the business license, registration certificate, go to the local social insurance agency, apply for social security registration. After the registration is completed, you can pay social insurance for your employees.
The five insurance and provident fund payment ratios are all different, and the company and individual payment ratios are different. It has to be calculated individually according to each person’s salary before paying the money.
Paying the five insurance and provident funds is still only a small part of financial accounting, and finance is only one of the skills needed to open a store. You also need to know how to design and decorate, how to purchase goods, how to maintain machinery, how to produce financial statements, how to promote the store, how to discount promotions, how to optimize the process, how to deal with landlords to increase rent, how to develop new products …… are you sure you master, or understand all the skills?
If you are really good at everything and no problems happened. Then congratulations, this milk tea store can be operated. So as the store manager, what will your life state be like at this time?
You can’t sleep, you have to get up early every day, prepare the materials, clean up and start the business. Repeatedly ordering, collecting, making milk tea, mixing, shaking and packing. If you accidentally make a mistake, you have to pour it out and redo it, and when you meet anxious customers, you have to reassure them, and you have to replenish the ingredients in time.
After a long day, my arms are sore, and I have to count the usage of ingredients and adjust the delivery plan. Then I cleaned and cleaned, and went home very late. Weekends are even less restful because the sales of milk tea will be higher than weekdays.
If I can have a little rest time, I also have to do financial statements, figure out how to optimize the process, and communicate with the store staff ……
Now when you recall the days of part-time work, do you feel more tired to open a store and not necessarily earn more than part-time work? Such a state, it seems, is not the fantasy of lying down and counting money.
Now the enterprise employees generally work hard, overtime is a common thing, we all feel very tired. But the owner of his own store, will be more difficult.
A survey in 2013 showed that 15% of civil servants and institution workers work seven days a week. Employees of companies, work a little more intensely, with a quarter working seven days a week.
And 70 percent of small and micro owners who run their own stores work seven days a week. Store owners who do not hire employees and work alone on their own are even closer to 80% working 7 days a week [14].
Making money does not come without a price for entrepreneurs, and stress always accompanies the life of entrepreneurs. One study found that stress can have various negative physical and psychological effects on entrepreneurs, such as hypertension, Atherosclerosis, and job burnout [15]. The mind is tired and the body is tired.
Therefore, the good life of a milk tea store owner exists only in fantasy, and as we mentioned earlier, less than one in five milk tea stores survive beyond one year [12]. With the money to open a store, it is better to buy two more cups of milk tea.
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