Hot pot entrepreneur cooks up big bucks
When the cold winter weather rolls in, it’s the perfect time to have a hot pot. The delicious meals have always been popular among Chinese people, but few of our ancestors could have expected this section of the catering industry – which has never been associated with fine dining – to one day emerge as a model of entrepreneurial success.
In China, Hai Di Lao, a Beijing-based hot pot restaurant chain, has become such a success that its business model was quoted in the Chinese edition of the Harvard Business Review in 2009. The company, which has about 70 outlets across China, distinguishes itself from other restaurants by offering caring, personalised services in addition to serving customers with food and drinks.
The chain offers free manicures and shoe shines for customers who are waiting for tables. Earlier this year, the company also broke ground by allowing Beijing and Shanghai customers to dine together via the internet, by seeing each other’s faces on flat-screen TVs in their private dining rooms.
The chain is reportedly so popular that business is robust even in the hot summer months. Its waiters and waitresses are known for their attentive, customer-orientated attitudes. The chain’s owner, Zhang Yong, a former factory worker from Sichuan, owes his success partly to his immense attention to the quality of service.
Putting aside the issue of how sustainable the business may be, China will only benefit from having more entrepreneurs who put customers’ interests above short-term gains. It is also high time for business schools to highlight the importance of sensitivity towards customer needs. This is inevitable in a global economy, where limitless new opportunities abound across national borders, along come with unprecedented competition. A commitment to better customer care is not necessarily a recipe for success, but will certainly give an enterprise a competitive edge.
According to recent reports, the operator of the American KFC chains in China – albeit still a major player in the mainland food industry – has seen revenue fall due to a softening economy, changing tastes and rising competition. With more choice naturally comes a fiercer fight for market share.
Zhang found the right path for his business by keeping his customers happy. Coming from a humble background and with no impressive academic records, he tried to develop his own business soon after graduating from a vocational college by pooling resources from his then girlfriend and two other friends. What sets him apart from other budding entrepreneurs is his concern for people. He said in an interview that all of his executives who have been promoted from low-level positions feel extremely valued. This apparently adds to their drive to serve the company and its customers well.
Besides management insights, having a heart for others could be a valuable lesson in the training of entrepreneurs.