“A fragrant Buddha Jumps Over the Wall can be done in just 10 minutes. For the Mid-Autumn Festival family dinner, arranging a bowl of pre-made Buddha Jumps Over the Wall for everyone is both impressive and affordable! The key is that the abalone is springy and the soup is delicious, not at all inferior to home-cooked meals,” shared a Xiaohongshu blogger. Using pre-made dishes to solve the Mid-Autumn Festival family dinner has become a way of celebrating for many young people, freeing up hands, saving time, and adding a sense of ritual. Not only do young people love it, but over the past three years, investment and financing events in the pre-made food sector have risen from 12 in 2020 to 31 in 2022. Internet giants and tycoons have also entered the pre-made food track, with companies like Hema Fresh, Laoniangjiu, and Ririxian rushing to IPO. On the other hand, on social platforms, voices resisting pre-made dishes are endless. Comments such as “unclean, unhealthy,” “expensive and not worth it,” and “hard to accept in restaurants” are common, and the recent “pre-made dishes entering schools” has sparked widespread questioning from parents and netizens. On one side, it is pursued by capital; on the other, it is criticized by netizens. As a highly controversial product, pre-made dishes are in a state of “fire and ice.” “Richest Man” Zhong Shanshan and Other Tycoons Enter A small plate of pre-made dishes has attracted many big names, even China’s richest man, Zhong Shanshan, has found it “really delicious.” In 2022, the “Mother” brand founded by Zhong Shanshan launched four convenient meal sets of “rice + toppings,” namely Sichuan Pepper Chicken, Curry Beef, Taiwanese Braised Pork, and Golden Soup Beef, priced around 20 yuan, with a set of four at about 55 yuan. From the sales situation, over 1,000 sold and over 500 reviews, the performance is average. Apart from this, the richest man has made no further moves. Image source: Taobao In addition to the richest man, Zhang Lan’s family, who dominated the internet with their “family matters” in 2022, also laid out plans for pre-made dishes early on. In November 2022, Wang Xiaofei and Big S broke out in a divorce dispute. Wang Xiaofei, Zhang Lan, and Big S’s family had multiple cross-space conversations, attracting public attention. During the spat between Wang Xiaofei and Big S’s family, Douyin live streaming data showed that from November 8 to November 23, Zhang Lan broadcast a total of 40 sessions, averaging 2.7 per day; from November 24 to December 2, Zhang Lan broadcast another 40 sessions, with the frequency increasing to 5 per day, almost doubling; and Zhang Lan often went offline late at night, with a dedication comparable to Li Jiaqi. The main products in Zhang Lan’s live stream were pre-made dishes from “Maliuji,” and she also took the opportunity to launch braised eggs, green tea, and “soft rice” meal sets, but the best-selling item was still the hot and sour noodles. According to Huitun data, in the ten days before the incident, from November 11 to 20, Zhang Lan’s live stream total sales were 1 million yuan; from November 21 to 30, cumulative sales exceeded 100 million yuan. Now, nearly ten months after the farce ended, according to Maliuji’s Tmall flagship store, the best-selling item is still the 24.9 yuan hot and sour noodles, with over 300,000 sold. The top 10 products also include small sausages, small yellow croaker, dried radish, and Chongqing noodles. Some are developing rapidly, while others are facing cold reception in pre-made dishes. Lu Zhengyao, founder of Luckin Coffee, after being “removed” from Luckin, founded the pre-made dish brand “Shejian Yingxiong” (Tongue Hero), with a grand gesture. In August 2020, Lu Zhengyao invested to establish Shejian Technology (Beijing) Co., Ltd. In early 2022, it launched the “Shejian Gongfang” project. The official website shows it currently has two sub-brands: Qubayu and Shejian Yingxiong. At its launch, Shejian Yingxiong used Luckin’s common tactics: “heavy marketing + subsidies + viral promotion + rapid store expansion.” In January 2022, it opened its first store in Beijing, and in March, it announced the completion of a 1.6 billion yuan Series B investment, becoming the pre-made dish company with the largest financing amount that year. According to media reports, Li Yingbo, rotating CEO of Shejian Technology, once revealed that as of the end of January this year, the number of intention-to-sign franchise stores for Shejian Yingxiong had reached 2,500-3,000. In April, it further revealed that the number of intention-to-sign dealer stores nationwide had reached 6,000, covering 30% of prefecture-level cities and major large and medium-sized cities. The official website shows that the minimum area requirement for a Shejian Gongfang franchise store is 8 square meters. Franchisees need to pay a sales support fee of 30,000 yuan, a warehousing, logistics, and delivery fee of 20,000 yuan per year, a deposit of 20,000 yuan, and a design fee of 1,800 yuan. But this craze lasted only one summer. In June 2022, a blogger exposed that Shejian Yingxiong franchisees were defending their rights; in August, multiple franchisees reported continuous losses to the media; on August 16, the first store of Shejian Yingxiong in Beijing announced closure. Subsequently, large-scale store closures occurred in many cities across the country. The latest update on Shejian Technology’s official website is from May 16, 2022. A-shares, H-shares, and US stocks All Have Pre-Made Food IPO Companies Before the tycoons entered the pre-made food industry, many practitioners had already achieved phased results and were rushing to IPO. The most famous is Hema Fresh, part of the Alibaba system. Hema Fresh was founded in 2015, with its first store opening in January 2016, regarded as Alibaba’s new retail sample. In January 2023, Hema founder and CEO Hou Yi sent a letter to all employees stating that in 2022, Hema Fresh’s sales increased by over 25% year-on-year, Hema X membership stores grew by over 247%, and the growth of Outlets and Neighborhood stores was as high as 555%. He also revealed that in 2022, Hema Fresh achieved profitability. As of now, there are over 300 Hema Fresh stores (including Hema mini), 9 Hema X membership stores, and 153 Hema villages nationwide. On May 18, Alibaba (9988.HK) officially announced that Cainiao and Hema Fresh had officially launched their listing plans, with Hema expected to complete within the next 6 to 12 months. There is Hema Fresh going to the Hong Kong stock market, and there is also Laoniangjiu sprinting for A-shares. It is a Chinese fast-food chain enterprise, mainly providing Chinese fast-food products with a Jiangnan flavor, while also catering to various regional cuisines. In 21 years since its establishment, Laoniangjiu has opened nearly 400 directly-operated stores. The official website shows that currently, a single Laoniangjiu store can serve over 1,000 meals per day on average. As a fast-food restaurant, Laoniangjiu’s per capita consumption is not high. Searching for Laoniangjiu on Dianping, the per capita is about 25 to 35 yuan, and the most popular group-buying set is: Yu Xiang Rou Si (shredded pork in garlic sauce) + rice + steamed egg + egg dumplings (2) + cabbage, priced at 22 yuan. According to the prospectus, Laoniangjiu’s revenue for 2019, 2020, and 2021 was 1.222 billion yuan, 1.2 billion yuan, and 1.525 billion yuan, respectively; net profit was 65.765 million yuan, 21.755 million yuan, and 63.847 million yuan. Laoniangjiu has previously gone through multiple financing rounds, with most investors having significant backgrounds. According to Aiqicha, Jinbang Capital invested in Laoniangjiu twice in 2016. It is the investment arm of the menswear brand K-boxing. According to filing information, Tibet Jinbang Jinda Venture Capital Partnership (Limited Partnership) is the fifth largest shareholder of Laoniangjiu, holding 7.27%. Image source: Aiqicha Fosun Pharma (600196.SH) made an angel investment in Laoniangjiu in 2009, but on January 2, 2020, Fosun Pharma replied to investor questions on the SSE Interactive platform, stating, “As of now, the group no longer holds shares in Zhejiang Laoniangjiu Catering Co., Ltd.” Dexun Investment, which invested in 2010, was founded by Tencent co-founder Zeng Liqing, and its team has a strong Tencent background; in 2020, the old investment institution Cystone Capital and state-owned Hangzhou Chengtou also invested in Laoniangjiu. There are profitable ones and also loss-making ones. Day Day Cook Food Group, which is sprinting for a US stock listing, is an enterprise that integrates content marketing, distribution channels, products, and brands. Day Day Cook originated from a blogger. The founder, Zhu Jiaying, is from Chaoshan. In 2012, she began sharing cooking tutorials on Facebook; in 2015, Zhu Jiaying moved her food video programs to platforms like Youku, iQiyi, and Douyin, gaining a following. In 2019, Day Day Cook shifted towards the pre-made dish track and founded its own brands. Currently, it has three major brands: Day Day Cook, Yujiaweng, and Mengwei. Among them, Day Day Cook is the core brand, with over 100 SKUs in total. But Day Day Cook has not yet become profitable. From 2020 to 2022, total revenue was 169 million yuan, 202 million yuan, and 180 million yuan, respectively. Net losses were 114 million yuan, 459 million yuan, and 122 million yuan. The cumulative loss over four years reached 695 million yuan. While the brand transformation was not smooth, Day Day Cook’s follower counts on Bilibili and Xiaohongshu are only 88,000 and 22,000, with cumulative video likes of 226,000 and 161,000, respectively. As of the end of 2022, Day Day Cook had cash reserves of 92.7123 million yuan, short-term liabilities of 166 million yuan, and an asset-liability ratio as high as 146.59%. In addition, many internet giants have also laid out plans for pre-made dishes. For example, Meituan Waimai launched a pre-made dish sales zone and introduced its own brand “Xiang Dà Chú”; JD Supermarket introduced three measures for pre-made dishes, including resource support, exclusive dish customization, and the establishment of an independent team. Under the Trillion-Yuan Blue Ocean, Food Safety Issues Await Resolution Behind the tycoons’ entry and pre-made dish companies’ moves in the capital market is the rapid development of the pre-made dish industry. According to iiMedia Research data, the Chinese pre-made dish market size in 2022 was 419.6 billion yuan, and it is expected to reach 1.072 trillion yuan by 2026. Noodles, rice, and vegetables account for nearly half of the share, but meat, poultry, and aquatic products have higher growth rates. In recent years, the number of investment and financing events in the pre-made dish industry has also continued to grow, from 12 in 2020 to 31 in 2022. However, most companies are relatively small. According to Ping An Securities statistics, based on data from CCID Think Tank, Zhiwei.com, and Tianyancha, 56% of companies have registered capital of less than one million yuan, and 51.8% of companies have financing rounds at Series A or earlier. Image source: Ping An Securities Moreover, pre-made dishes are currently mainly concentrated in first- and second-tier cities. According to the “2023 China Chinese-style Catering White Paper,” pre-made dish consumers are mostly in first- and second-tier cities, with over 45% of consumers in first-tier cities and nearly 20% in second-tier cities. This indicates that the more economically developed and time-costly the region, the more prosperous the pre-made dish market. At the same time, the 2023 Central Document No. 1 included pre-made dishes for the first time, stating the need to “cultivate and develop the pre-made dish industry.” On July 28, the National Development and Reform Commission issued the “Measures to Restore and Expand Consumption,” which again mentioned cultivating the model of “planting and breeding bases + central kitchens + cold chain logistics + catering stores,” tapping the potential of the pre-made dish market, and accelerating the construction of pre-made dish bases. However, during rapid development, pre-made dishes have also encountered many problems, among which consumers are most concerned about food safety. In February 2023, the Jiangsu Provincial Consumer Protection Committee released the “Pre-made Dish Consumption Survey Report,” showing that over 80% of consumers encountered problems such as stale ingredients, spoiled and deteriorated dishes, damaged packaging, and expired products when purchasing pre-made dishes. Since the second half of 2022, Hema Fresh has been named by quality inspection departments almost every month. For example, on August 7, 2022, Hema Fresh was fined 487,200 yuan and confiscated illegal gains of 9,761.22 yuan for selling Tipco orange juice with excessive “acesulfame” in the inspection items; on September 21, it was fined 50,000 yuan for selling crucian carp with excessive “enrofloxacin,” a broad-spectrum antibacterial drug; in October, it was fined 60,000 yuan for producing and selling bread with no relevant ingredients in the ingredient list; in December, it was reported again for “enrofloxacin” exceeding the standard by more than 5 times, and in the same month, it was fined 65,000 yuan for excessive thiamethoxam in Pingdu old ginger. Just before this year’s “315,” Hema Fresh was fined 65,000 yuan for excessive veterinary drug residues in food. Laoniangjiu has also received multiple administrative penalties. On July 9, 2019, the Cixi Market Supervision Administration issued an “Administrative Penalty Decision” to Laoniangjiu’s Huzhou District Fulu Second Branch. The branch was fined 2,500 yuan for failing to clean and disinfect tableware as required, violating food safety management regulations. In addition, Laoniangjiu has been penalized 7 times by relevant departments for violating the “Advertising Law,” failing to sort garbage as required, failing to set up collection containers as required, and not disclosing prices to consumers when selling disposable takeout boxes and disposable tableware, with total fines of 45,000 yuan. In addition to regulatory attention, consumers often complain. Searching “Laoniangjiu” on “Black Cat Complaint,” consumers have raised issues including but not limited to spoiled chicken soup, moldy rice, and insects in food. Xianmeilai, once considered likely to become the “first stock of aquatic pre-made dishes,” has also been repeatedly exposed for food safety issues. In April 2018, the Beihai Quality and Technical Supervision Bureau found that some 200g peeled shrimp products produced by Xianmeilai were deemed unqualified in net content after testing; In September 2020, the Dabu County Market Supervision Administration in Guangdong inspected a total of 86 batches of food, involving 3 unqualified Xianmeilai products: 120g/bag peeled shrimp, 200g/bag hot pot squid whiskers, and 248g/bag basa fish; In January 2021, during an inspection by the Ebian County Market Supervision Administration in Sichuan, three boxes of “Xianmeilai” deep-sea cod in a supermarket were found to be past their shelf life, resulting in the confiscation of illegal gains of 157.9 yuan and a fine of 50,000 yuan; in October 2021, the Changchun Market Supervision Administration sampled and found that “Three Shrimp” dumplings (300g/bag) produced by Zhengzhou Xianmeilai had unqualified peroxide value (calculated as fat). Xianmeilai also voluntarily withdrew its IPO application in September 2023, and the Shanghai Stock Exchange terminated its issuance and listing review. “Regarding the development of pre-made dishes, I personally believe that we cannot overly rely on the promotion of the capital market. Pre-made dishes need to be developed steadily and pragmatically. Capital promotion often tends to take ‘clever shortcuts,’ seeking rapid returns, a fast word, fast market scale, fast group volume, and fast listing. In terms of marketing strategies for pre-made dishes, my personal view is that ‘eye-catching’ and ‘traffic-seeking’ marketing practices are not as good as steady progress. For pre-made dishes to become a common dining mode like current takeout or cooked food, market recognition still needs time and process,” said Yuan Shuai, executive vice president of the Agricultural, Cultural, and Tourism Industry Revitalization Research Institute. What are your views on pre-made dishes? Welcome to leave a comment below for discussion.