Summary of Key Points
The "four friends" who opened 14,000 stores in three years did so not through mergers and acquisitions or financing, but by transforming traditional mahjong halls into "unmanned self-service venues." They then expanded rapidly through low-barrier franchising. The essence of this business model is as follows: The brand sells a standardized "unmanned store system" to franchisees, while the brand itself makes a steady profit from equipment sales, decoration costs, and royalties. Franchisees, while seemingly earning easily, face challenges such as a dilution of customer traffic and meager profits. These self-service venues have also opened up new use cases, such as for team building activities and hourly rentals for college students, and in the future, could potentially be replicated in other industries like KTVs and billiard rooms.
Why Are Self-Service Chess and Mahjong Venues So Popular?
These venues have solved two major problems associated with traditional mahjong halls: the owner needs to be present 24/7, and customer traffic relies on referrals from acquaintances. For example, a mahjong hall in Hangzhou lost all its business when the person responsible for attracting customers moved to another job and stopped bringing customers in.
Self-service venues address these issues with unmanned solutions: smart devices (used to select venues, open doors with QR codes, and sell snacks and power banks) replace human staff; online marketing through platforms like Douyin and Dazhongping helps attract customers without the need for referrals.
Young people find these venues appealing for three reasons:
- Privacy: Small, clean private booths that are not as cluttered as traditional mahjong halls.
- Flexibility: They are open 24/7 and located in office buildings with security, eliminating concerns about encountering unwanted visitors at night.
- Affordability: The cost of 70 yuan for 4 hours of use is cheaper than playing mahjong in unair-conditioned parks in Shenzhen, and they have even become a cheaper alternative to hotel rooms for college students, offering space for studying and group activities.
Why Has Franchising for Self-Service Chess and Mahjong Venues Become a "Side Business Dream" for White-Collar Workers?
Compared to businesses like bubble tea and convenience stores, the franchising barriers for self-service venues are incredibly low:
1. Low initial investment: Franchise fees and brand usage fees are often free, and the total cost of decoration, equipment, and rent is around one to two hundred thousand yuan (the franchise approval rate for Mixue Ice City is less than 5%, making it harder to get a franchise than to win a stock lottery).
2. Easy operation: No need to train employees or worry about inventory losses; a part-time cleaner is enough to maintain the venues, allowing one person to manage multiple stores.
This represents a tempting opportunity for white-collar workers looking to start a side business without quitting their jobs.
The Real Situation for Franchisees: Is It Really "Easy Money"?
Although the headquarters claim a return on investment in 11.3 months, the reality is more challenging:
- Revenue caps: Even if all 8 booths in a store are occupied 24/7, the maximum revenue is limited.
- Dilution of customer traffic: More stores opened by the brand attract customers from the surrounding area, reducing business for nearby franchises.
- Meager profits: Profits depend on cheap group purchases; without marketing, there are no customers, and marketing costs eat into profits. Franchisee A, who invested 200,000 yuan, still lost 200,000 yuan after 8 months, joking that his store was just a "private club for friends to use."
In essence, whether franchisees make a profit depends largely on luck, and most end up losing money.
The Brand Is the One That Really Makes Easy Money
The income sources for the brand are stable:
1. One-time revenues: Sales of smart devices and decoration materials (even without franchise fees).
2. Regular royalties: The brand earns a 5% commission from franchisee sales, regardless of their profit.
3. New customer acquisition through marketing: In 2024, the brand invested 100 million yuan in offline advertising (subways, Douyin) to attract more franchisees, leading to higher profits as more stores are opened.
By 2025, its annual revenue is expected to exceed 1.2 billion yuan. Essentially, the brand is selling a "unmanned store system" that can be easily replicated.
Where Else Can This Model Be Applied?
The founders have already applied this model to self-service KTVs (opening 700 stores in one year) and self-service billiard rooms. They plan to expand into the food and drink and live music industries as well—any business that requires an "independent space with unmanned operation" can benefit from this model.
In summary, the success of self-service chess and mahjong venues is a testament to innovative business models. However, franchisees need to be cautious: It's always easier for a brand to encourage others to open stores than for it to do so itself. The real "easy money" comes from the brand that sells the technology that enables these venues to operate unmanned.
Final Conclusion
The popularity of self-service chess and mahjong venues reflects the success of innovative business models. However, franchisees should be aware that while opening stores may seem like a good opportunity, the real profit comes from the brand that provides the technology and support necessary for their operation.