Summary of Key Points
The new tea drink industry has experienced explosive growth from 2023 to 2024, characterized by a surge in new store openings and listings, before beginning to cool down in 2025, with a significant slowdown in growth and a net decrease in store numbers. Today, the industry has formed a "pyramid" structure: at the top are eight leading brands with over 5,000 stores each; in the middle are brands with a recognizable presence but not nationwide coverage; at the bottom, a large number of small and medium-sized stores have been eliminated. The leading brands have differentiated into three main models:
1. Mixue Ice City: focuses on its supply chain, using it to gain a competitive advantage.
2. Ba Wang Cha Ji: emphasizes building a "high-value" brand image.
3. Gu Ming/Tea Bai Dao: adopts a strategy of high-density franchising.
The competitive focus has shifted from simply opening as many stores as possible to improving the efficiency of each store and the uniqueness of their business models.
Detailed Analysis
1. The Industry's Cooling Down: From "Crazy Expansion" to "Practical Calculation"
In 2023, the new tea drink industry was one of the hottest, with a growth rate of 19.3%, attracting a lot of investment. Major brands saw a 32.5% increase in store numbers. In 2024-2025, several brands went public (including Tea Bai Dao and Mixue), with the goal of opening tens of thousands of stores. However, the second half of 2025 brought a sharp turnaround:
- Growth Slump: The market size reached 374.9 billion yuan, but the year-on-year growth rate was only 5.7% (far lower than the 19.3% in 2023).
- Net Loss of Stores: Nearly 157,000 stores closed, while 118,000 new ones opened, resulting in a daily net decrease of over 100 stores. 64% of brands experienced contraction or stagnation.
- Shift in Strategy: The focus has shifted from expanding the number of stores to improving the efficiency and profitability of each store, as the industry moves from a phase of competing for market share to one of optimizing existing resources.
2. The New Tea Drink Pyramid: The Top Brands Profit, Middle Brands Struggle, and the Bottom Fails
Looking at the 449,000 stores nationwide, the industry structure resembles a pyramid:
- Top (over 5,000 stores): Only eight brands—Mixue, Gu Ming, Hu Shang A Yi, Tea Bai Dao, Ba Wang Cha Ji, Yi He Tang, Tian La La, and Shu Yi—have established a stable presence with effective supply chain and franchise management systems. Among these, Nai Xue (with 1,685 stores) does not meet the criteria for the top tier.
- Middle (brands with local presence but no nationwide expansion): Brands like Xi Cha and Cha Yan Yue Se have regional influence but lack the scale and efficiency of the top brands, making it difficult for them to expand.
- Bottom (small and medium-sized stores): Many family-owned businesses and local brands have disappeared. In the past, these stores survived through strategic locations and connections; now, chain brands are expanding to smaller towns and communities, outcompeting them on price, supply chain, and brand recognition.
3. The Three Leading Brands: Each with Its Own Survival Strategy
Although these brands all sell tea drinks, their business models are fundamentally different:
（1）Mixue Ice City: Often referred to as the "SHEIN of the tea drink industry," Mixue relies on its supply chain to maximize profits. In the first half of the year, 14.8 billion yuan of its 15.2 billion yuan revenue came from selling raw materials and equipment to franchisees, with franchise fees accounting for only 420 million yuan. By optimizing its supply chain, Mixue can offer products at competitive prices (e.g., lemon water for 6 yuan). However, it is facing challenges, with revenue growth of only 2.3% and a 14.7% decline in profits, prompting it to diversify into other products (such as coffee and beer).
（2）Ba Wang Cha Ji: The youngest of the six major brands, Ba Wang Cha Ji focuses on building a "high-value" brand image. With fewer stores, each store generates a high monthly turnover (338,000 yuan in the Greater China region, the highest among the six brands). It targets a mid-range price segment and uses quality ingredients and unique design to attract customers willing to pay for a better experience. In 2025, the brand slowed its expansion to focus on improving the efficiency of existing stores, performing well during a period of declining consumer spending.
（3）Gu Ming/Tea Bai Dao: These brands follow a traditional model of starting locally and then expanding nationwide, similar to brands like Jue Wei and Hua Lei Si. They have a large number of stores in lower-tier cities and towns, using their network to reduce costs. For example, 73% of Gu Ming's stores are within 150 kilometers of a warehouse, and 99% receive supplies every two days. They are also exploring new growth areas, such as adding coffee services to their menu or expanding their product range.
4. What Lies Ahead? Efficiency, Business Models, and Identity
As the industry's growth momentum fades, the focus of competition has shifted to:
- Efficiency: The output and profitability of each store (Ba Wang Cha Ji has fewer stores but higher profits; Mixue has more stores but faces profit pressure).
- Business Models: Different models (supply chain, brand, and density) each have their advantages and disadvantages, with no clear winner.
- Identity: The question is whether a company will focus on its supply chain, brand, or retail operations (e.g., Mixue as a supply chain provider, Ba Wang Cha Ji as a brand-focused company, or Gu Ming as a chain retailer).
The new tea drink industry has just entered a more competitive phase, where scale is no longer the sole determinant of success. Efficiency and business model will be key, and the ultimate success will depend on the company's chosen path.
Conclusion
The new tea drink industry has evolved from rapid growth to more rational competition. The differentiation among leading brands has made the industry clearer: there is no one-size-fits-all approach. Brands like Mixue, Ba Wang Cha Ji, and Gu Ming are each experimenting with strategies to thrive in a mature market. For consumers, this means they can expect more affordable and enjoyable tea drinks. For the industry, this marks the beginning of true maturity.