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Text/Daily Financial Report Lv Mingxia

I think everyone has eaten Shaxian snacks, which are found in streets and alleys all over the country. Although I haven't eaten them for a long time, the steamed dumplings, wontons, and clay pot soups there are very impressive.

The Shaxian snacks, which are sold all over the country, have been pushed to the forefront recently because of the investigation of a senior executive. According to the Shaxian District Discipline Inspection and Supervision Commission of Sanming City, Fujian Province, Tong Youjian, chairman of the Shaxian District Snacks Culture and Tourism Development Group Co., Ltd., is suspected of serious violations of duty and is currently under supervision and investigation by the Shaxian District Supervision Commission.

So will this investigation of senior executives affect the more than 88,000 stores across the country that carry the "Shaxian Snacks" sign?

Senior executives are being investigated

It is worth mentioning that before this, there was another high-level review and investigation information about the Shaxian District Snack Culture and Tourism Development Group. The Shaxian District Discipline Inspection and Supervision Commission announced in May that the group's deputy general manager Xu Zhenhai was suspected of serious violations of duty and is currently under supervision and investigation by the Shaxian District Supervision Commission. According to the public resume, Xu Zhenhai has served as deputy general manager of Shaxian District Snack Culture and Tourism Development Group Co., Ltd. since August 2021.

Judging from the resumes of the two, they have quite a lot of intersections. They have both worked for Fujian Shayang Cultural Tourism Development Group Co., Ltd. (a subsidiary of Shaxian Snacks Cultural Tourism Group), and both joined Shaxian Snacks Cultural Tourism Group in August 2021.

Tong Youjian's public resume shows that he served as chairman and general manager of Shaxian District Snack Culture and Tourism Development Group Co., Ltd. from August 2021 to December 2023; from December 2023 to July 2024, he served as chairman of Shaxian District Snack Culture and Tourism Development Group Co., Ltd.; and was dismissed in July 2024.

Why were the two executives investigated in succession? The Shaxian District Snack Culture and Tourism Development Group did not directly disclose the reason. But historically, such incidents usually involve financial irregularities, business ethics violations or other legal issues. Influenced by this incident, the public began to question the operating model and internal management of Shaxian Snacks.

Why is the food industry also prone to corruption? Industry insiders said that most food companies that have experienced corruption are large in size, with multiple organizational structures and multiple levels of personnel. In fact, as a relatively traditional industry, the food industry has a low entry threshold and uneven personnel quality. In addition, managers have greater power and the supervision process is not standardized, so corruption is more likely to occur.

Source: Official website

When the news of Tong Youjian's investigation was released, many people were shocked that Shaxian Snacks was actually a state-owned enterprise. According to the official website, Shaxian Snacks Cultural Tourism Group was established in September 2021. It is one of the three state-owned enterprises in the district with a registered capital of 165 million yuan and its existing state-owned assets are worth more than 1 billion yuan.

Shaxian Snacks Culture and Tourism Group has three second-level subsidiaries, namely Shaxian Snacks Group Co., Ltd., Fujian Shayang Cultural Tourism Development Group Co., Ltd., and Shaxian Haobo Cultural and Sports Industry Development Co., Ltd., which are mainly responsible for product development, market expansion, brand promotion of Shaxian District's snack industry, as well as business development, promotion and publicity, and event organization services of the cultural tourism industry.

Tianyancha shows that Shaxian Snacks Group Co., Ltd., a wholly-owned subsidiary of Shaxian Snacks Cultural Tourism Group, was established in 2008. The official website of Shaxian Snacks Group Co., Ltd. shows that there are currently 88,000 Shaxian Snacks stores, more than 4,000 chain standard stores, covering 62 cities. Since 2010, Shaxian Snacks has begun to plan for listing, but it has not yet been realized.

“"Wild growth" sows bitter fruit

It is understood that Shaxian snacks are a well-developed local specialty snack in my country. Because the villagers went out to run snack businesses early, the local Yubang Village has the reputation of "the first village of Shaxian snacks". More than 60% of the villagers in the village are engaged in the Shaxian snack industry in more than 30 cities across the country.

"One yuan to enter the store, two yuan to eat your fill, and five yuan to eat well." The consumption proposition advocated by Shaxian snacks has made it fully recognizable, and the "old four" of mixed noodles, flat meat, stewed pots, and steamed dumplings have supported the main flow of each restaurant.

Almost at the same time as the migrant worker boom in China, the low-cost catering market saw an opportunity for development at the end of the last century. Shaxian snacks also followed this trend and consolidated its position in the industry.

In addition to consumer positioning, lower product production and restaurant operation requirements, coupled with policy encouragement and support, have also accelerated the expansion of Shaxian snacks.

As the Chinese catering market upgrades and iterates, Shaxian snacks are also facing the dilemma of slow development that cannot keep up with the pace of modernization, insufficient innovation, and declining brand influence, and are falling into a dilemma of lack of successors.

Since Shaxian snacks started early, there was a lack of overall regulatory systems in the early days, resulting in a relatively scattered team of stores. Some stores had problems such as poor service quality and substandard environmental hygiene during their operations, which affected the brand image and consumer trust.

Over the years, the dishes and tastes of Shaxian snacks have basically not changed much, lacking novelty and characteristics. In this era of pursuing freshness and personalization, no innovation means losing appeal and competitiveness.

The catering industry is an industry where old players keep dying on the beach, but new players keep coming in. Consumers will pay for newer products, but what can keep consumers for a long time is still delicious food and better service, which should never change.