Is 2022 the year of the ‘lazy economy’ and ‘internet cakes’?
A bakery chain with dreams of consolidating China’s baked goods market just raised 100 million yuan ($15.7 million) to expand its delivery network to the entire country.
- Founded as a brick-and-mortar chain in 2008, Bliss Cake had 40 locations before CEO Yuán Huǒhóng pivoted completely to online sales — “internet cakes,” that is — in 2014.
- The cake shop turned its attention to mastering cold chain logistics, in which temperature-sensitive products are delivered fresh and on time. Cakes are semi-finished at a central factory, stored in regional capitals, then completed and delivered from a satellite factory no more than three kilometers from the final destination.
- Yuan’s vision of a national cake brand seems within reach: His brand now covers 300 major cities in every corner of the country, including Tibet, Xinjiang, and Heilongjiang. By 2024, the company plans to cover 80% of smaller counties.
A second food brand with similar ambitions, Chuān Wázi — roughly translated as “Sichuan Baby” — recently raised 300 million yuan ($47 million) to conquer the world of premade sauces and seasonings.
- CEO Táng Lěi — a Sichuan native, hence the brand’s name — has a compelling story of starting one meat skewer restaurant in 2008, and growing it into a booming restaurant chain, and finally to a company selling the basic elements that helped him succeed in the first place: his signature seasoning.
- Chuan Wazi counts both home cooks and restaurants among its customers. The first group is obvious — in the “lazy economy,” people want great food with less effort — but even the latter get plenty of value from premade sauces and spice blends, which allow them to save time, standardize recipes, and maintain quality. Some 15,000 chain restaurants use the brand, most notably Haidilao.
- The pandemic gave Chuan Wazi a boost, especially an appearance on superstar livestream salesman Lì Jiāqí broadcast room in 2020, which brought sales of 500,000 bottles of roasted pepper sauce within three minutes. Overall sales are up 42% in the past three years as the brand reaches widespread awareness.
Expect more internet cakes next year. Chuan Wazi and Bliss Cake also epitomize brands of the “real economy,” the market of tangible goods that are less vulnerable to a “common prosperity” crackdown. At the same time, they’re hitting on a business model with high growth potential: delivering familiar, comforting flavors to the customer’s door.
There’s a reason even TikTok is getting in on “ghost kitchens.”
Author: Matthew Silberman, SupChina