5 facts about the Hai Di Lao hot pot empire and its billionaire founder
Amid news that Hai Di Lao plans to close or suspend about 300 outlets, we take a look at the story of its founder and how the hot pot restaurant evolved to become a global chain.
Hong Kong listed hot pot giant Hai Di Lao said in a filing exchange on Nov 5 that it will be shutting down or suspending the operations of around 300 outlets by end December 2021, citing poor table turnover and operating results.
The closures will reportedly affect mainly outlets in its home country of China, although it will affect countries that the company has expanded into. Exact markets were not revealed, but it is believed that Singapore outlets remain unaffected.
The restaurant has been expanding aggressively in recent years. But it has been a bumpy ride for its billionaire founder Zhang Yong. Here are five facts about the wealthy restaurateur and his hot pot empire.
HE WENT FROM RAGS TO RICHES
Did you know? China-born Zhang Yong is a high school dropout who didn’t dine at an actual restaurant until he was 19 years old. He grew up in Jianyang, a rural province in Sichuan, and once worked as a factory welder in a tractor company, earning a meagre US$14 (S$19) a day.
In 1994, he quit his job and used his life savings to open a small, four-table restaurant. That small restaurant evolved to become the Hai Di Lao we know and love today.
HE WAS ONCE SINGAPORE'S RICHEST MAN
In 2018, Zhang moved to Singapore and became a Singapore citizen. A year later, he topped Forbes’ 2019 Singapore Rich List with a net worth of US$13.8 billion. In 2020, Zhang maintained that spot, his net worth growing to US$19 billion.
However, Zhang slipped to No 4 this year, his net worth declining to US$16 billion. According to Forbes’ Real-Time Billionaires list, Zhang’s net worth currently stands at US$8.9 billion.
HAI DI LAO'S SECRET INGREDIENT IS ITS LEGENDARY SERVICE
Prior to the news that the hot pot chain is shuttering outlets, there’s no denying that the Hai Di Lao tale is an extraordinary success story. Its secret ingredient? The legendary service. While waiting in line, customers are given snacks to munch on. They can also get a massage, manicure, shoe shining service and more.
The chain’s legendary service stems from Zhang’s very own belief that customers are won table by table.
IT HAS 1,597 OUTLETS GLOBALLY
Since its founding, Hai Di Lao has expanded beyond China, with outlets in Singapore, the US, South Korea, Japan, Canada, Australia, Malaysia, Vietnam and the UK.
As of end-June, the Hai Di Lao empire consists of a total of 1,597 restaurants globally. In Singapore, it has 18 restaurants, with one more slated to open at Northshore Plaza in Punggol.
PANDEMIC SLOWED THE GROWTH OF THE GROUP
While rapid expansion was always the plan for Hai Di Lao, the pandemic slowed the roll-out of new restaurants. With consumers dining out less, the chain witnessed falling table turnover rates and profits, Reuters reported.
The chain said in its latest filing that it would shut down restaurants with relatively low customer traffic and unsatisfying results. Instead, it would launch a new plan focused on improving the operations of its existing stores.