Summary of the Main Issues in Plain Language
Two leading snack vending brands that have recently become popular across the country—Mingming Hengmang (which includes brands like Snack Hengmang and Zhao Yiming Snacks) and Haolaixiang—have been exposed by consumers for using fraudulent weighing practices. In Cangzhou, Hebei, four bags of beef jerky were charged 64.58 yuan, but upon reweighing, the actual weight was only 17.29 yuan. In Zhoukou, Henan, a consumer paid 111 yuan for a bunch of snacks, only to find that the amount had been significantly reduced after reweighing. Regulatory authorities in many regions have launched special inspections to check the electronic scales in these brands’ stores. Mingming Hengmang has issued an urgent apology and proposed a comprehensive set of measures, including compensating customers ten times the amount of any discrepancy and implementing remote monitoring of all scales by the headquarters. However, consumers’ doubts remain: How can industry leaders that have already gone public and generate billions in annual revenue fail to control such practices in their tens of thousands of stores? The root of the problem lies in the rapid expansion of the franchise network, which has outpaced the ability of the headquarters to oversee all outlets. Now that the initial benefits of scale expansion have been exhausted, long-standing management shortcomings have come to light.
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The Tricks Used by These Brands to Deceive Consumers Are Impossible to Prevent
Many people might wonder how such discrepancies can go unnoticed. In reality, merchants have anticipated and exploited consumers’ lack of awareness:
- When customers buy snacks in small quantities, they often choose from dozens of items, and the receipt is full of details. It’s difficult to manually calculate the total weight and notice small discrepancies of a few grams.
- Merchants target high-priced items like beef jerky and nuts, where a few extra grams can result in a significant extra charge that’s hardly noticeable.
- Even if customers discover the issue, merchants can simply claim it’s a “system error” and offer a refund, with little consequence.
For stores, this is a surefire way to make a profit. For example, a store that sells snacks in small quantities can earn 50,000 yuan per month. By inflating the weight by just 5%, they can earn an extra 2,500 yuan—almost equivalent to half a staff member’s salary—with almost no additional effort or cost.
Why Can Publicly Traded Companies Not Stop Such Fraud?
The core issue lies in the inherent flaws of the franchise model:
Mingming Hengmang has nearly 30,000 stores, 99.97% of which are franchises, with very few direct-operated stores. Haolaixiang has opened 18,000 stores in just two years, also through franchising. The company’s profit model relies on selling goods to franchises rather than on price differences at the store level. The headquarters earns profits from supplying goods, and any fraudulent practices by stores do not affect its financial reports. Additionally, the pressure from shareholders to increase store numbers and revenue quickly means that management focuses on expanding rather than supervising existing stores. Franchisees, with low margins (average gross profit of 18%-20%), often resort to such tactics to make ends meet.
The Ineffective Remedies of “Ten-Fold Compensation + Remote Monitoring”
Mingming Hengmang’s proposed solutions seem thorough: they offer tenfold compensation and require daily weight checks with standard weights. Electronic scales are connected to the headquarters for real-time data monitoring, and all transactions are recorded. However, these measures fail to address the fundamental issue of uncooperative franchisees. Even if the headquarters provides standard weights and monitoring, franchise owners may simply ignore them or manipulate the scales. Similar attempts in the tea and delivery industries have also shown that technical solutions cannot prevent fraudulent behavior.
The Damage Caused by Fraudulent Weighing
The fraudulent practices are undermining the trust that made these snack brands so popular. Consumers initially chose these stores because of their affordable prices and honest pricing. Now, such actions destroy that trust. Customers now check the weights at convenience stores after shopping, and the brand’s reputation for honesty is being damaged by repeated incidents.
To Solve the Problem, Changes Are Needed at the Core
The industry must address the root causes. Simply compensating after incidents is not enough. The franchise model needs to be restructured to ensure that franchisees cannot profit from fraudulent practices. Franchisees should not be forced to open stores but should be given a reasonable profit margin that allows them to operate ethically. “Measurement compliance” should become a mandatory requirement for franchise participation, with severe consequences for any violations. For consumers, it’s simple to verify the weight of snacks before purchasing by using their phones or other devices. By doing so, merchants will be less likely to cheat.
In summary, the current issues highlight the importance of maintaining trust and ethical business practices in the snack vending industry. The success of these brands was built on honest pricing, and any breach of that trust can quickly erode their customer base and damage their reputation.