Hai Di Lao Rarely Reflects on Old Growth Model: Growth Should Shift from the Frontline to "Headquarters Platform Driven"

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One of Haidilao’s most distinctive organizational abilities in the past was granting authority to the frontline. But as the restaurant business becomes increasingly difficult, the boundaries of this model are now being redefined.

On August 25, Haidilao disclosed its unaudited 2026 interim results. The company’s revenue in the first half of the year was 22.337 billion yuan, up 7.9% year-on-year; non-IFRS core operating profit was 2.513 billion yuan, up 4.4%; and profit during the period was 1.764 billion yuan, with a minimal increase of only 0.5%.

The main brand has still not fully recovered. Haidilao restaurant operating income fell 4% to 17.837 billion yuan, and the average daily sales per store dropped from 78,900 yuan to 77,800 yuan.

Store efficiency has somewhat stabilized: the turnover rate of self-operated Haidilao restaurants rose from 3.8 times/day last year to 3.9 times/day. The system-wide sales (including self-operated and franchised stores) increased 0.8% year-on-year.

Haidilao does have new growth engines. Takeout revenue reached 2.051 billion yuan, up 121.2% year-on-year; other restaurants outside of the main brand brought in 1.271 billion yuan, up 113.1% year-on-year. Both businesses saw revenues double.

More noteworthy than the financial numbers is that management has rarely publicly reflected on Haidilao’s past organizational model.

The interim report states that the company's growth in the past "mainly relied on store management capabilities," strongly incentivizing store managers, but "headquarters functions were relatively slim." Thus, 2026 is defined as the “first year of middle-office management capacity building,” with growth momentum to shift gradually from “single-store driven” to “headquarters platform driven.”

This stands in contrast to Haidilao’s previous expansion approach.

After organizational flattening around 2016, Haidilao once formed a typical bottom-up fission mechanism: Store managers were responsible not only for daily operations but also for cultivating new managers and developing new restaurants; headquarters provided location directions, store managers identified specific properties, and final decisions were made jointly.

This emphasis on frontline flexibility lasted for a long time. Even by 2025, Haidilao was still affirming local autonomous operations.

The annual report stated the company implemented “one store one strategy,” and delegated some product decision rights to regional divisions, with more than 100 regional specialty products that year. Stores with fresh-cut products, late-night snacks, family-friendly, and pet-friendly themes also emerged during this period.

Soon, the boundaries of flexibility became apparent. After the pet-friendly pilot expanded to three stores, related videos sparked hygiene controversies, and the company halted the pilot in May 2026.

According to the latest role division given in the interim report, headquarters accumulates operational knowledge, coordinates strategy and resources, and then “outputs uniformly to stores.” Stores, in turn, focus on “managing customers and employees.”

Centralized merchandise management is also moving upward. Headquarters now “uniformly plans quarterly product launches,” linking marketing, scenarios, and membership operations.

The company is moving basic operations online, letting store standards become “established and regulated,” and is exploring artificial intelligence for business analytics.

As an important mechanism for Haidilao’s new brand incubation, the “Red Pomegranate Plan” best illustrates this change.

Haidilao launched this plan in August 2024 to explore different business models through internal entrepreneurship. In 2025, the company formed two systems: "Chef Owners" and "People’s Restaurant;" the former focuses on employee entrepreneurship, the latter tends to be headquarters-led.

This year, the company began systematically evaluating ongoing projects, concentrating resources on those already validated; those with immature models are adjusted and integrated, and new stores must undergo stricter feasibility verification and monthly assessments.

The essence of the tightened strategy is the inevitable intersection of macro environment and internal corporate evolution. When the marginal effect of end-level incentives diminishes, headquarters must centralize authority and coordinate the overall situation.

In January 2026, founder Zhang Yong resumed the role of CEO after nearly four years off the post. Former CEO Gou Yiqun moved on to coordinate intelligent and automated processes, vigorously promoting the construction of the intelligent middle platform.

Under headquarters coordination, the business layer is changing from the previous relatively scattered exploration. The newly selected “street barbecue hot pot” and “sushi” businesses will be fully managed and expanded by the headquarters middle platform.

This logic of middle platform enablement also extends to the opening of main brand stores.

The company expects to speed up store openings in 2027, but new stores will “rely on different store models output by the middle platform,” entering both high-end city malls and lower-tier markets, and the franchise business will also adopt a “more cautious principle.”

Whether this new system can become the antidote for Haidilao will ultimately be tested by main brand same-store sales, new store quality, and multi-brand profitability.

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