“Duck Neck King” Falls into Its Darkest Hour

Source | New Retail ID | ixinlingshou Author | Lianshang.com Editorial Department

Amid the dual pressures of consumption downgrading and intensifying industry competition, the former “Duck Neck King” is facing an unprecedented survival crisis. On September 19, Juewei Food announced that it had received an advance notice of administrative penalty from the Hunan Regulatory Bureau of the China Securities Regulatory Commission. The company failed to recognize franchise store decoration business revenue from 2017 to 2021, resulting in understated operating revenue in annual reports and false records in financial data. Consequently, the company's stock will be subject to other risk warnings (ST), meaning China's largest braised food enterprise will officially wear the ST label, and its stock abbreviation will change to “ST Juewei.” Five Years of Concealing 700 Million Yuan in Revenue Juewei Food's franchise model was once a powerful tool for its rapid rise, but it has also become the source of today's crisis. The Hunan Regulatory Bureau's investigation uncovered the financial dark corners beneath the glossy exterior of this “10,000-store empire”: from 2017 to 2021, the company failed to recognize franchise store decoration business revenue, leading to understated operating revenue in annual reports, with a total of approximately 724 million yuan underreported over five years. These underreported revenues accounted for 5.48%, 3.79%, 2.20%, 2.39%, and 1.64% of the publicly disclosed operating revenue for the corresponding years (2017-2021), respectively. The scale is shocking, and more notably, this financial manipulation exposed the interest game between headquarters and franchisees in the franchise model. As revealed by the case of new tea brand Shanghai Auntie, enterprises highly dependent on franchise models often face dual risks of declining single-store efficiency and supply chain fragility, and ultimately, it is the franchisees who bear the risk. The Hunan Regulatory Bureau ordered Juewei Food to rectify, issued a warning, and imposed a fine of 4 million yuan. The then chairman and general manager Dai Wenjun was fined 2 million yuan, then CFO Peng Caigang and board secretary Peng Gangyi were fined 1.5 million yuan and 1 million yuan, respectively. The severity of the penalties reflects the regulator's zero-tolerance attitude toward financial fraud and also reveals serious internal control deficiencies at Juewei. Dai Wenjun, as the directly responsible supervisor, knew that the company actually managed franchise store decoration business but did not promote standardized business management or include it in the listed company's accounting system. Behind this deliberate financial manipulation is an excessive pursuit of scale growth. By excluding decoration revenue from the statements, Juewei was able to maintain a superficial prosperity during a period of slowing performance growth, until the regulatory sword fell. The financial loopholes under the franchise model are not unique to Juewei. From the lament of a Shanghai Auntie franchisee, “Be cautious about franchising; I've lost everything,” to the experience of a Tuhu car maintenance franchisee facing a 1.3 million yuan claim for breach of contract, these all reveal the trust rift between headquarters and franchisees in the franchise model. When brand owners treat franchisees as mere profit sources rather than partners, the foundation of the entire business system begins to shake. The Operational Predicament of the “Duck Neck King” Behind the financial fraud, Juewei Food's operational fundamentals are continuously deteriorating. In the first half of 2025, the company achieved operating revenue of 2.82 billion yuan, a year-on-year decrease of 15.57%; net profit was 175 million yuan, a year-on-year decrease of 40.71%. This report card forms a stark contrast with the company's “billion-yuan revenue” dream for 2025 proposed in 2022. Based on the first-half performance, second-half operating revenue would need to reach at least 7.18 billion yuan to meet the target, which is almost an impossible task. Once upon a time, Juewei Food's expansion speed amazed the industry. In 2019, it achieved the feat of “10,000 stores,” reaching 10,954 stores; by the end of 2023, the number of stores peaked at 15,950. However, this rapid expansion model planted huge hidden dangers. In the first half of 2024, the number of stores decreased to 14,969, with nearly 1,000 net store closures in half a year; as of August 15, 2025, the number of operating stores further decreased to 10,838, a reduction of 4,131 compared to mid-2024. Behind the wave of store closures is a sharp decline in single-store profitability. In 2023, Juewei's stores increased by 874, but sales of fresh products decreased by 4.36% year-on-year, with both poultry and vegetable products experiencing declines. This paradox of “more stores, lower sales” reveals a cruel reality in the braised food industry: when the market is nearly saturated, blind expansion only leads to intensified internal competition and dilutes single-store profits. In stark contrast to Juewei's decline, Zhou Hei Ya has effectively controlled the decline in overall revenue by improving single-store operational efficiency and driving effective growth in average single-store sales. Huang Shang Huang, on the other hand, increased procurement when raw material prices were low, lowering the weighted average cost of some major raw materials, achieving counter-trend growth in net profit. The “profit growth without revenue growth” strategy of these two companies highlights Juewei's shortcomings in cost control and operational efficiency. To cope with the crisis, Juewei Food has attempted to find breakthroughs by launching “Juewei Plus” store formats, adding dine-in space, and enriching product lines. In 2025, the Plus store launched in Changsha attracted young consumers with innovative products such as mint duck neck and Sichuan pepper twist chicken feet, as well as scenario-based design, becoming a Xiaohongshu check-in hotspot during trial operation. However, this transformation attempt has had limited effect and failed to reverse the overall downward trend. Juewei Plus store A deeper issue lies in product structure and pricing strategy. On social platforms like Douyin, “price assassin” has become the most common complaint from consumers about Juewei: duck neck at 60 yuan per jin, duck intestines at 130 yuan per jin, and duck tongues as high as 200 yuan per jin. This pricing strategy seems out of place in the context of consumption downgrading, leading nearly 80% of respondents to reduce their frequency of purchasing braised food from chain brands. When young consumers turn to more cost-effective white-label stores, Juewei's high-price strategy undoubtedly accelerates customer loss. The Overall Winter of the Braised Food Market Juewei Food's predicament is not an isolated case but a systemic challenge facing the entire braised food industry. Data from the 2025 semi-annual reports show that the three major braised food enterprises all experienced revenue declines: Juewei Food's revenue was 2.82 billion yuan, down 15.57% year-on-year; Huang Shang Huang's revenue was 984 million yuan, down 7.19%; Zhou Hei Ya's revenue was 1.222 billion yuan, down 2.9%. The entire industry is experiencing an unprecedented “ice age.” Data from the Hongcan Industry Research Institute shows that in 2024, the braised food category market size was 157.3 billion yuan, with a year-on-year growth rate of only 3.7%; it is expected to slightly increase to 162 billion yuan in 2025, with further slowing growth. Behind this slowing growth are structural changes in consumer demand: on one hand, per capita consumption is trending downward, with the proportion of stores with prices below 25 yuan continuously rising; on the other hand, increased health awareness makes young people wary of traditional high-salt, high-oil braised foods. In contrast to the declining performance of traditional giants, various emerging braised food brands are rising strongly. Phenomenal brands like Wang Xiaolu have opened the market with hit product strategies, while hot braised brands like Shengxiangting Hot Braised and Yantang Hot Braised are rapidly expanding with freshly made experiences and meal-scenario extensions. Even snack giants like Three Squirrels and Beicaowei have entered the market, continuously seizing the existing and incremental market of traditional braised food brands. The rise of hot braised food poses a direct threat to Juewei, which focuses on cold braised food. Compared to the pre-packaged model of cold braised food, hot braised food features freshly cooked and mixed, hot food, suitable for “eat on the go” and fast-food consumption scenarios. This model better meets young consumers' pursuit of freshness and experience, and is more easily combined with staple foods to expand lunch and dinner scenarios, forming a differentiated competitive advantage. Changes in the industry competitive landscape are also reflected in market concentration. Although Juewei, Zhou Hei Ya, and Huang Shang Huang are called the “Big Three of Braised Food,” the overall industry concentration remains very low, with the CR3 for braised products in 2022 being only 3.89%. This means small and medium brands still have opportunities to overtake on curves, while also intensifying market competition. According to Hongcan Big Data, as of April 2025, braised food brands with 50 or fewer stores nationwide accounted for 85.6%, while those with more than 500 stores accounted for only 1.4%. Changes in consumer demand also pose challenges to traditional braised food brands. As Generation Z becomes the main consumer group, braised food consumption is no longer limited to simple taste experiences but is deeply tied to social interaction, emotions, and scenarios. Although Juewei has tried to get closer to young people by signing Fan Chengcheng as spokesperson and launching the brand slogan “Dare to be spicy, only Juewei,” its pace in product innovation and scenario creation still lags behind. Channel transformation is also reshaping the industry ecosystem. The rise of instant retail allows consumers to quickly obtain braised food products through delivery platforms, impacting traditional brands that rely on offline stores. At the same time, the development of community group buying makes white-label braised food products more accessible to consumers, further diverting customers from chain brands. In this context of channel diversification, the model of relying solely on offline store expansion is no longer sustainable. Final Thoughts As of the close on September 19, Juewei Food's stock price closed at 15.25 yuan per share, with a total market value of 9.242 billion yuan, having evaporated approximately 53.7 billion yuan from its peak. From a stock price exceeding 100 yuan and a total market value exceeding 63 billion yuan in February 2021, to now less than 10 billion yuan, Juewei Food's market value has shrunk by nearly 85% in just over four years, with the speed of market value shrinkage far exceeding the speed of store closures. Dai Wenjun and his management team have not been without attempts at self-rescue. Juewei Food has tried to cope with the crisis by launching “Juewei Plus” store formats, adding dine-in space, and enriching product lines. However, judging from performance, these attempts have brought minimal improvement. But for the 57-year-old Dai Wenjun, under the multiple pressures of regulatory penalties, fading franchise dividends, and intensifying industry competition, achieving a comeback is clearly a long and arduous task. The competition in the braised food industry is far from over. With the continuous evolution of consumer demand and the reshaping of the market landscape, the industry will usher in a new round of reshuffling. For Juewei, wearing the ST label may not be the end. If it can use this opportunity to thoroughly reflect on its business model and reshape brand value, it still has a chance to find a new foothold in the competition.