Analysis of Systemic Channel Risks in Mingming Manghuang and the Bulk Snack Industry

Based on the collected information, I will conduct an in-depth analysis of the systemic channel risks in Mingming Manghuang and the bulk snack industry from multiple dimensions.

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As China’s largest casual food and beverage chain retailer, Mingming Manghuang passed the HKEX hearing on January 6, 2026, and is about to list on the Hong Kong Stock Exchange as the “first bulk snack stock”[1][2]. According to the post-hearing information pack:

Core Indicators	Data Performance	YoY Change
Number of Stores	Over 20,000 signed, 19,517 in operation	Covers 28 provinces
GMV (Retail Sales)	RMB 66.1 billion (Q1-Q3 2025)	YoY growth of 74.5%
Operating Revenue	RMB 46.371 billion	YoY growth of 75.2%
Adjusted Net Profit	RMB 1.81 billion	YoY growth of 240.8%
Gross Profit Margin	9.7%	Continuously increased from 7.5% in 2022
Adjusted Net Profit Margin	3.9%	Doubled from 1.9% in 2022
Operating Cash Flow	RMB 2.19 billion	Strong cash generation capability
Member Repurchase Rate	77% (past 12 months)	Over 180 million registered members

From 2022 to 2024, Mingming Manghuang’s revenue surged from RMB 4.286 billion to RMB 39.344 billion, with a three-year compound growth rate of 203%; during the same period, adjusted net profit increased from RMB 810 million to RMB 913 million, with a compound growth rate of 234.6%[1][3].

Regarding the franchisee store closure rate that users are concerned about, data shows:

Year	Store Closure Rate
2022	0.74%
2023	0.67%
2024	1.9%
Q1-Q3 2025	1.08%

The 1.9% store closure rate in 2024 is indeed a relatively high level, but it needs to be interpreted in the industry context: 2024 was a period of rapid expansion in the bulk snack industry, and aggressive store opening strategies led to the elimination of some stores with improper locations or insufficient operational capabilities. The store closure rate dropped to 1.08% in Q1-Q3 2025, indicating that the company’s franchisee management system is being optimized[1].

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The current bulk snack industry has formed a

[4][5]:

(Snack Busy + Zhao Yiming Snacks):

• Stores cover 28 provinces and all tiered cities
• 99.3% of revenue comes from selling goods to stores
• Has the largest digital team in the industry

(Haoxianglai Brand Snacks):

• Stores cover 22 provinces, 4 municipalities directly under the central government, and 5 autonomous regions
• 15,365 stores in H1 2025
• Renamed from “Biotechnology Group” to “Food Group” in December 2025, with a clearer strategic direction

Both parties attract franchisees with preferential franchise policies[1]:

Mingming Manghuang’s “Five Zeros Policy”	Haoxianglai’s Benefits
Franchise fee fully waived	Franchise fee fully waived
Management fee fully waived	Management fee fully waived
Training fee fully waived	Distribution fee fully waived
Service fee fully waived	-
Zero profit from decoration	-
Up to RMB 108,000 store opening subsidy	-

The essence of this policy concession is

, but it also hides a hidden danger - franchisees’ dependence on subsidies increases, and once subsidies are reduced, large-scale withdrawal of investment may occur.

The core competitiveness of bulk snacks lies in “low prices”:

• Product prices are about 25% lower than the average price of similar products in supermarkets[1]
• Gross profit margin is only 7%-10%, significantly lower than traditional retail formats (large supermarkets such as Walmart and Yonghui Supermarket usually have higher gross profit margins)
• The bulk snack format operates with a low gross profit margin model, reducing the markup rate in intermediate links[5]

1. Store closure rate is generally within a healthy range
   • Mingming Manghuang’s store closure rate of 1.08%-1.9% is at a relatively low level in the retail industry
   • Compared with the average store closure rate of 10%-15% in the catering industry, the franchise model of bulk snacks is relatively stable[1]

2. Financial data shows strong risk resistance
   • Gross profit margin increased from 7.5% to 9.7%, indicating that price wars have not completely eroded profit margins
   • Adjusted net profit margin increased from 1.9% to 3.9%, and profitability continues to strengthen
   • Operating cash flow of RMB 2.19 billion, with healthy cash flow status[1][2]

3. Supply chain efficiency forms a moat
   • Mingming Manghuang has established partnerships with over 2,500 high-quality manufacturers (including 50% of the enterprises on the Hurun China Food Industry Top 100 List)
   • 48 logistics warehouses nationwide, 300 km delivery coverage, enabling efficient 24-hour restocking
   • Inventory turnover period is only 11.6 days, and warehousing and logistics costs account for 1.7% of total revenue, both leading the industry[1]

4. Increased industry concentration reduces vicious competition
   • The duopoly pattern is relatively stable, with Wanchen Group and Mingming Manghuang leading peers by a large scale margin
   • The brand and scale advantages of leading enterprises continue to be released, forming a pattern where the strong get stronger[5]

1. The dividend period of scale expansion is gradually fading
   • Scarcity of high-quality locations has become a common industry problem
   • A franchisee in a central province said: “The province is basically fully covered, there are no new locations to open, we can only increase density and compete with rivals for the market”[1]
   • The company’s policy has shifted to “increasing density to compete with rivals” in 2026

2. Channel diversification impacts traditional models
   • The traditional circulation chain of “manufacturer → distributor → terminal network → consumer” in the snack industry is undergoing a disruptive restructuring
   • Taking the linkage between pre-packaged and bulk foods as an example, once the price system of pre-packaged foods is unbalanced, the sales of bulk foods will be hindered simultaneously
   • A large number of distributors have chosen to transform or terminate cooperation due to continuous losses[6]

3. Franchisees’ diversified layout reflects shaken confidence
   • Some franchisees have turned their attention to the milk tea track (such as Mixue, Guming)
   • A franchisee frankly said: “Investment in a snack store is twice that of a milk tea shop, I don’t want to put all my eggs in one basket”
   • The initial investment for a single bulk snack store is about RMB 600,000-1,000,000, and the investment payback period is worthy of attention[1]

4. Interest game of upstream brand owners
   • Most traditional brands both aspire to embrace the dividends of hard discount channels and worry about being controlled by channel parties and losing pricing power
   • Mingming Manghuang has launched its own brand layout, turning the bulk channel from a “traffic ally” of traditional brands into a direct competitor[6]

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Scenario	Trigger Conditions	Probability	Industry Impact
Base Scenario	Duopoly maintains current competition pattern, price wars ease	50%	The industry develops steadily, and the profitability of leading enterprises continues to improve
Optimistic Scenario	Industry integration further deepens, leading market share increases to over 60%	20%	Gross profit margin stabilizes and rebounds, franchisee profitability improves
Pessimistic Scenario	Price wars continue to intensify, subsidy reduction leads to large-scale store closures by franchisees	30%	Industry clearance accelerates, small and medium-sized brands exit, leading enterprises take the opportunity to integrate

• After listing, it will receive capital support, and is expected to increase investment in supply chain, product research and development, etc.
• Need to pay attention to the strategic transformation from “scale expansion” to “high-quality development”
• The layout of own brands is both an opportunity and a challenge, and it is necessary to balance cooperative relationships with brand owners

• Against the background of scarce high-quality locations, it is necessary to carefully evaluate site selection and investment return expectations
• Pay attention to changes in headquarters subsidy policies and conduct profitability stress tests
• Consider moderate diversified layout to diversify risks

• Accurately match channels according to their own product characteristics and target groups
• Explore cooperation models such as channel-customized SKUs to balance the interests of all parties
• Transform from a simple “seller” to a channel “growth partner”

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The

, but structural pressures are accumulating. Mingming Manghuang’s 1.9% store closure rate is still within a healthy range, and its profitability and cash flow status shown in financial data provide a buffer for coping with industry reshuffling. However, the squeeze on industry profit margins by price wars, the scarcity of high-quality locations, and the model restructuring brought by channel diversification will all put higher demands on industry participants in 2026.

From an investment perspective, as an industry leader, Mingming Manghuang is expected to further consolidate its competitive barriers with capital support after listing on the Hong Kong Stock Exchange; however, from the perspective of franchisees and upstream brand owners, it is necessary to closely follow the evolution of the competition pattern and policy changes, and manage risks well.

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[1] 36Kr - Mingming Manghuang Takes the Lead in Landing on HKEX, New Year’s Shopping Festival Becomes the First Battle in the Second Half of the Bulk Snack Industry (https://m.36kr.com/p/3628833763492871)

[2] Rednet - Is the “First Bulk Snack Stock” on Hong Kong Stock Exchange Coming? Mingming Manghuang Passes the Listing Hearing (https://hn.rednet.cn/content/646045/98/15598961.html)

[3] DoNews - Mingming Manghuang Passes HKEX Hearing: Number of Stores Exceeds 20,000 (https://www.donews.com/news/detail/1/6353556.html)

[4] CBNData - Snack Busy Partners with Zhao Yiming, Is the Story of Bulk Snacks Coming to an End? (https://www.cbndata.com/information/287571)

[5] Orient Fortune Securities Research Report - Wanchen Group Started with Edible Fungi, Crossed into the Bulk Snack Track in 2022 (http://pdf.dfcfw.com/pdf/H3_AP202509071739989785_1.pdf)

[6] 21st Century Business Herald - Snack Industry 2025: Breaking the Impasse, Transformation and Long-Term Growth Path (https://www.21jingji.com/article/20260108/herald/418d3b4e1c9304f30804a0927f9f8774.html)