---
title: "Why Are Bulk Snack Companies Rushing to Go Public? The Answer Lies Behind the Stores"
description: "When Wanchen Group submitted its prospectus to the Hong Kong Stock Exchange on September 23, it was only five months after its main competitor, 'Mingming Henmang,' had filed. If Wanchen successfully lists in Hong Kong, it will become the industry's first A+H listed company. The two giants of China's bulk snack industry, after intense competition over store counts, have almost simultaneously extended their battle to the capital markets. This IPO race is not a celebration of the industry's peak but a strategic positioning battle as growth shifts from rapid expansion to a zero-sum game."
author: "十里"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2025-10-18"
categories: "Capital, Earnings & M&A, Retail Formats"
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original_source: "https://mp.weixin.qq.com/s/PPwlybgFYdOX66OmXNVcwQ"
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citation: "十里. “Why Are Bulk Snack Companies Rushing to Go Public? The Answer Lies Behind the Stores.” New Distribution, 2025-10-18. https://xinjignxiao.com/en/articles/why-are-bulk-snack-companies-rushing-to-go-public-the-answer-lies-behind-4e6ae461/"
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# Why Are Bulk Snack Companies Rushing to Go Public? The Answer Lies Behind the Stores

> When Wanchen Group submitted its prospectus to the Hong Kong Stock Exchange on September 23, it was only five months after its main competitor, 'Mingming Henmang,' had filed. If Wanchen successfully lists in Hong Kong, it will become the industry's first A+H listed company. The two giants of China's bulk snack industry, after intense competition over store counts, have almost simultaneously extended their battle to the capital markets. This IPO race is not a celebration of the industry's peak but a strategic positioning battle as growth shifts from rapid expansion to a zero-sum game.

**Source** | Lingshou
Shi Dang, when Wanchen Group submitted its prospectus to the Hong Kong Stock Exchange on September 23, it was only five months after its main competitor, 'Mingming Henmang,' had filed. If Wanchen Group successfully lists on the Hong Kong Stock Exchange, it will become the industry's first A+H listed company.
The two giants of China's bulk snack industry, after intense competition over store counts, have almost simultaneously extended their battle to the capital markets.
This IPO race is not a celebration of the industry's peak. It is more like a strategic positioning battle as growth shifts from rapid expansion to a zero-sum game. The 'ticket' to the capital market is both a necessary supply for the next round of competition and a bargaining chip for defense and offense for these giants with annual revenues in the hundreds of billions and stores nationwide.
However, behind this seemingly logical capital move, it also reflects the industry's growth dilemma.
**Challenges After Reaching 10,000 Stores**
In the consumption bills of Changsha consumer Lin Hui, the proportion of bulk snacks is quietly declining.
She was once the most loyal supporter of this business model. In early 2023, when the first 'Mingming Henmang' opened downstairs from her home, the extreme cost-effectiveness and novel shopping experience made her visit two or three times a week. But now, her consumption frequency has dropped to 'once every half month when I remember.'
Lin Hui's waning enthusiasm is not an isolated case; it reflects the challenges the entire industry is facing.
First, there is oversaturation. What made Lin Hui lose her sense of novelty is the excessive density of stores. In less than a year, within one kilometer of her residential area, there are now two 'Mingming Henmang' and two 'Haoxianglai' stores. 'It used to feel new, but now there are too many stores, and I don't feel like browsing.'
Her feeling is a signal that the industry's front-end expansion has peaked; the model of driving performance through rapid store openings is experiencing diminishing returns.
Data confirms this trend. According to Wanchen Group's prospectus, in 2024, its net increase in stores was 9,746; in the first half of 2025, the net increase was 1,169. When high-quality store locations are exhausted, high-density close combat becomes inevitable.
These terminal pressures eventually transmit to the franchise system that supports the industry. Wanchen disclosed that the number of closed franchise stores increased in the first half of 2025. Reports of 'multiple Haoxianglai stores in Jinan closing and relocating' also serve as side evidence of adjustments in the franchise ecosystem.
The surge in store numbers has not always brought a variety of choices.
Another important reason for Lin Hui's reduced consumption is that 'no matter which store I visit, it feels the same.' She found that whether it's 'Mingming Henmang' or 'Haoxianglai,' the brands and flavors of spicy strips, potato chips, and jelly on the shelves are largely similar. Occasionally, she wants to buy a niche biscuit she had before, but she can't find it even after visiting all four stores.
This high overlap in product selection reflects the industry's insufficient supply chain capabilities and directly leads to fierce price wars. When products cannot differentiate, price becomes the only competitive tool.
But this is a high-risk game. According to media reports, Mingming Henmang's gross margin has long been maintained at about 7.6%, while Wanchen Group's gross margin in the first half of 2025 was 11.49%. Such thin profit margins can hardly withstand the impact of rising raw material, logistics, and labor costs, and lack a buffer to cope with price wars.
Thus, the market is caught in a dilemma: if they don't engage in price wars, customer traffic may be diverted to competitors; if they do, profits may be squeezed below the break-even line.
When the consumption experience is diluted and product choices become similar, consumers will unhesitatingly flow to better alternatives, which is the challenge of the growth bottleneck of a single business model.
Recently, Lin Hui has started to frequent a new hard discount supermarket near her community. There, she can not only buy her usual snacks but also milk, eggs, and daily necessities at competitive prices.
'Since I'm looking for bargains, I'll choose a place where I can buy more variety,' Lin Hui's change in consumption choices reveals a deeper threat to bulk snacks: the business model of relying solely on selling snacks has a clear ceiling. When consumers have more efficient and diverse choices, the appeal of a single business model declines.
In fact, leading players have begun to try to break out. Mingming Henmang launched 'Zhao Yiming Save Money Supermarket,' and Wanchen Group laid out 'Laiyoupin Save Money Supermarket' and 'Haoxianglai Quanshi Youxuan,' attempting to extend from snack specialty stores to full-category hard discount formats. Although the strategic direction is clear, execution is difficult. Reconstructing the supply chain and facing stronger cross-industry competitors require substantial and continuous capital investment.
The combination of the above three challenges undoubtedly indicates that the bulk snack industry has bid farewell to the golden era of 'wild growth.' Whether maintaining the existing network or developing new businesses, it requires deeper operational skills and more abundant capital support.
**Asking Capital for Money**
Any business model that deviates from fundamentals is unsustainable. For Wanchen Group and Mingming Henmang, the driving forces behind their move to the public market are different but equally urgent practical pressures.
For Wanchen Group, the primary task of listing in Hong Kong is to optimize its financial structure.
This A-share listed company, which started in the edible fungus business, is not a native player in bulk snacks. It only entered the track in 2022 with the new brand 'Lu Xiaocan,' and then through rapid mergers and acquisitions, it brought multiple regional brands such as 'Haoxianglai' and 'Laiyoupin' under its umbrella, unifying them under the 'Haoxianglai' brand. In just two years, the number of stores soared from 232 at the end of 2022 to 14,196 at the end of 2024.
This external expansion brought a sense of scale but also a rapid rise in financial leverage. According to the prospectus, Wanchen's debt-to-asset ratio climbed from 24.38% at the end of 2021 to 79.85% at the end of 2024, and although it slightly fell to 68.9% by the end of June 2025, it remains high.
For a retail format that relies on high cash turnover and extremely thin profit margins, this level of debt means liquidity is on thin ice. Any market fluctuation could affect the daily operations of terminal stores. For Lin Hui, these numbers may be uninteresting, but they directly determine whether the 'Haoxianglai' store downstairs from her home can operate normally.
Therefore, Wanchen's 'A+H' dual listing is essentially about introducing new funds through equity financing to reduce debt levels, improve asset structure, and fundamentally lower operational risks.
At the same time, it is also a reshaping of internal governance. Whether it can successfully pass the IPO is also a test of team capability and management level.
In contrast, Mingming Henmang's internal finances are relatively stable, but it also feels the tightening competition.
It is reported that as of September 2025, its store count has exceeded 20,000. However, against the backdrop of saturated industry penetration, simply competing on the speed of store openings is hard to lock in advantages; the focus of competition is shifting to the backend. Supply chain efficiency, warehousing and logistics capabilities, and digitalization level are the hardcore indicators for the second half.
In its prospectus, Mingming Henmang clearly lists the use of funds, focusing on store upgrades, supply chain optimization, and digital system construction. This means converting existing scale advantages into deeper operational efficiency advantages.
These seemingly minor improvements require large-scale and long-term capital investment. The same capital planning extends to new business formats. The move to full-category hard discount is also about retaining old customers and attracting new ones.
In fact, whether it is to deleverage and stabilize the market, or to strengthen the moat and promote business transformation, both companies have chosen the same path to the capital market. The difference is only where the funds will go within their systems—different areas of the financial statements and different links in the operational chain.
But from the consumer side, these adjustments will eventually manifest in some way. It may be that stores no longer change hands easily, or there may be a few new products on the shelves that Lin Hui has never seen, or it may just be the satisfaction of walking in and buying all the snacks you want.
**After Listing**
If one company is the first to appear in the capital market and claim the title of 'First Bulk Snack Stock,' it will certainly reap many benefits, but it will also face many pressures.
First, there is the dual boost of capital and credibility.
Listing means obtaining a substantial amount of funds at once, which can be used to upgrade the supply chain, develop more distinctive products to keep consumers like Lin Hui feeling fresh, and provide startup capital for entering new businesses like 'hard discount supermarkets.' Capital is the prerequisite for implementing strategy.
On the other hand, being the 'first stock' is also a brand endorsement. Franchisees tend to prefer listed companies with transparent finances and standardized operations; suppliers, especially food factories, are more willing to cooperate deeply with partners with stable orders and reliable settlement—this channel and supply chain advantage formed by credibility is likely to play a long-term role in future competition.
The pressure is equally significant and continuous.
First, there is performance pressure. After listing, quarterly financial reports must be submitted to the market, and the capital market always expects numbers to keep rising. But the reality is that the industry's overall growth is slowing. To maintain the performance on the report, management may make short-term optimizations, such as reducing promotions or adjusting product mix to improve gross margins, which may affect the 'cost-effectiveness' perceived by users to some extent.
Second, there is increased transparency. All core operational data of listed companies must be disclosed, including average sales per store, same-store growth, and the proportion of franchise store closures. Any negative change could alert the capital market, affecting stock prices and brand reputation, requiring companies to establish more refined data management and risk control capabilities.
There is also the challenge of strategic focus. Shareholders want to see short-term returns, but some things require long-term investment, such as building a modern warehousing center; investing hundreds of millions may take years to show results, and short-term financial reports will only show declining profits. Management needs to find a balance between shareholders' short-term interests and the company's long-term development.
The halo of 'First Bulk Snack Stock' does not guarantee success. The 'First Milk Tea Stock' and 'First Front-Warehouse Stock' were both in the spotlight at listing, but later encountered problems in competition. Ultimately, a company's long-term value is determined by the health of its core business and the execution of its strategy.
The entry of capital will accelerate the differentiation and upgrading of competition in the bulk snack industry. But listing is not the end, nor is it the only criterion for victory. The real key is whether the company can use the funds well to solve the deep problems hidden during rapid expansion—such as consistently and stably providing consumers with services that are worth both price and experience.
Whoever can find a balance among growth, profitability, and risk, and execute the strategy effectively over the long term, will have the opportunity to laugh last in this protracted war.


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## Citation metadata

- Publisher: New Distribution
- Author: 十里
- Published: 2025-10-18
- Canonical: https://xinjignxiao.com/en/articles/why-are-bulk-snack-companies-rushing-to-go-public-the-answer-lies-behind-4e6ae461/
- Original source: https://mp.weixin.qq.com/s/PPwlybgFYdOX66OmXNVcwQ

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