FoodBud

Before the Castle, Part 8 — 2012: Responsibility, the 3000 Plan, and the Birth of Lemonade ### 2012：更重的责任、3000计划与柠檬水诞生 **A FoodBud translated & annotated edition of Mixue co-founder Zhang Hongfu's first-person memoir**

*Series: "Before the Castle — How Mixue Was Really Built, 1997–2017" · Article 8 of 12 · FoodBud /insights*

1. FoodBud Editor's Note

Article 7 ended with the high-end store closing after two and a half years and only 6,100 yuan in profit. Article 8 begins at the end of 2011, when Zhang Hongfu asks to take on heavier responsibility. He wants to become general manager, but he frames the request carefully: power, yes, but not for the sake of power. He wants room to execute a logic he believes in, raise partners' incomes, and serve franchisees better.

This article covers one of the most consequential years in the memoir. The shareholders peacefully split responsibilities. The office is transformed with warm light, red brand color, posters, plants, and an IKEA sofa. The team sets a "triple growth" target and launches the 3000 Plan to lift store-level revenue. It learns, painfully, that a leader cannot operate only from the store and ignore the office. And through a messy franchisee conflict in Luoyang, Mixue's lemonade is born — first called "Ice-Extracted Lemon," then renamed by customers themselves.

2. Why This Installment Matters

Mixue's later scale depends on two systems that appear here: franchisee governance and product iteration. The governance lesson is that franchisees bring family savings and deserve site review, survival support, and operating improvement rather than a one-time franchise-fee transaction. The product lesson is that lemonade succeeds because it is fresh, cheap, large, and customer-named. The memoir makes the product's origin morally complicated: a wrong done to an old franchisee becomes the setting for a major product. Zhang Hongfu preserves both the success and the guilt.

—— FoodBud English Translation of the Source · Part 8 Begins ——

Heavier Responsibility

Zhang Hongfu wanted to shoulder heavier responsibility. He wanted power, but not for the sake of power.

By the end of 2011, while the company was developing, there were still many confusions and worries, both for him personally and among the shareholders.

For many years, Zhang Hongchao often joked that Zhang Hongfu had no hair above his mouth, so he was unreliable in handling affairs. Zhang Hongfu also knew his own weakness. That lack of steadiness still has not been effectively solved even today, he says. But inside, he held back a breath and wanted to prove himself. So he could only work harder, grow slowly in the corner, do a little more, and accumulate battle value.

Many franchisees called him when they had troubles and wanted to talk. He also wanted to solve problems for them better — not only the immediate and surface problems, but deeper and more thorough problems.

Some of the stores he had handled had accumulated operating experience and verified the feasibility of the model he believed in. He wanted to carry that model forward.

At this point, they also had disagreements over development direction. Two shareholders wanted to move in a trading-company model, which could quickly and effectively integrate social resources. Zhang Hongfu and Zhang Hongchao wanted to build their own factory and take control of core production and manufacturing.

Beyond that, there were also disputes over operating thinking and employee salaries.

Everyone fell into distress. In the coming year of 2012, where should they go?

Everyone has his own understanding of operations. This is never simply right or wrong. Everyone was excellent, and everyone wanted the company's problems to be better solved and partners to become richer. The key lay in which direction to choose, whether the timing was appropriate, and whether execution could be thorough.

Zhang Hongfu firmly believed in his own judgment and wanted even more to prove it. He wanted to lay out step by step the operating logic he believed in. So during Chinese New Year, at the beginning of 2012, he volunteered himself to them: he wanted to be general manager.

He needed power. He needed a freer, larger stage. This stage would allow him to realize what was in his heart better, without interference and without constraint. He believed only this way could he implement his inner ideas relatively completely. Combining what he had accumulated in past understanding, he had confidence that in the coming 2012 he could double the previous year's revenue — in fact, he was calculating triple, but was embarrassed to say something so fierce — and raise partners' incomes by two to three times as well.

He had one requirement: in the coming year, the other shareholders should not go to the company. Everything would be decided by him.

It was a difficult choice. But everyone had worked together for several years and could ultimately understand one another — or perhaps compromise helplessly.

Then they peacefully separated responsibilities. Tao Ge and Manager Zhang (章) founded a trading company, which developed very well. Zhang Hongchao, as he wished, took out a small portion of funds and returned to Kaifeng to open an ice-cream-powder factory. Zhang Hongfu took responsibility for the chain-franchise brand and business module.

He wanted to shoulder heavier responsibility: to have power, but not for power's sake. He wanted to serve their partners better. He wanted to increase everyone's income, but not for his own income. He clearly knew that he wanted to be general manager not to show off; he had not done that in the past, and in the future he never would.

Regarding the partnership among them, he also held much guilt inside. If not for him, perhaps they could have developed better in another form. If not for him, Manager Zhang's policies could have been implemented more thoroughly and the company's management efficiency could have become higher. But in this world there is no "perhaps." He directly told them his request, and in the end everyone made his own choice.

Entrepreneurship has a hundred dangers; years end up like a dream. The road ahead seems vast, with east and west hard to distinguish. Each flies to the far corners of the world; someday they may meet again. May none of us fail this life.

The Field: A Small Flame From Eyes to Heart

After raising wages, Zhang Hongfu immediately attacked the second topic he had long wanted to change: the office environment.

In the previous year, October 17, 2011, they had moved into what was then the new office, on the sixth floor of Caizhi Mingzuo near Dongfeng Road and Xinxueyuan Road. The new office was about 60 square meters. Half was divided into three very small separate rooms — one small room could fit only one desk, one staff member, and receive two customers at a time — used for franchise development, finance, and meetings. The other half was the public office area, where clerks, reception, and design staff sat.

The first time he went to that office, when he entered the room, he felt very bad. First, the lighting was especially dark. Second, the public-office desks had tall gray glass partitions. If clerks lowered their heads, looking in from the door was like looking at a no-man's land. The three compartments had been made by building frames, inserting glass, and wrapping the frames with gray aluminum-plastic panels.

The office lighting used cold white fluorescent tubes. They shone down on several rows of tall, gray public-office desks, combined with the silver-gray aluminum-plastic panels of the three compartments. The entire room felt dark and gray. But it was unlike today's fashionable high-grade gray with texture. The gray layer on the aluminum-plastic panels was sprayed paint, with a strong plastic feeling.

As one colleague put it, it looked neither like the sweetness of selling ice cream nor like the enthusiasm and vitality of young people. It felt no different from Zhengzhou's tens of thousands of small trading-company offices. If the sign were removed and replaced with "so-and-so feed company Zhengzhou office," it would not look out of place.

Zhang Hongfu wanted to start from what was around them and give everyone a bright, warm, refreshing office environment. But the company was short of money, and he could not spend heavily on renovation. He decided to control the budget within a few thousand yuan and make a big transformation.

First was lighting. The grid lights above used off-brand cold-light tubes. In a roughly 50-square-meter area, there were only six sets of grid lights, far from bright enough and with no warm feeling.

Thanks to his past experience renovating stores, he wanted to use warm light. Warm light makes people feel warm and comfortable. He also knew which brands were more reliable. So he went to the building-materials market where he often bought lights, bought twelve sets of grid lights of the same specification, added thirty-six Philips T5 warm-color fluorescent tubes of the same size, returned to the company, and replaced them.

Originally there had been six sets. Adding twelve new sets meant the 60-square-meter office had eighteen sets of grid lights. He then reallocated the tubes in those eighteen sets, ensuring that the tubes on both sides of each grid were warm-colored, while the middle tube used the old cold-color tube from the previous lights. This way the overall light came down as warm white without becoming excessively yellow.

Fixing the lights cost about five or six hundred yuan. Once they were turned on, everything was completely different. That bright light swept away the past gloom. Looking at partners' eyes, one could feel their eyes becoming brighter.

Lights alone were not enough. The walls and desk fronts also needed transformation.

The walls were simple: repaint with latex paint. But the paint had to be mixed into a warm color, giving the warmth of home, yet not too warm. In the end they chose ivory white. It removed a trace of coldness and added warmth. As for mixing latex paint, Zhang Hongfu simply did it himself, because he had previously mixed the ceiling color for the home-style restaurant.

Then came the office desks. At the time, the brand color had already been decided as rose red. He asked partners to design the logo together with the slogan "share sweetness, pass on happiness," using rose red as the base. They printed adhesive backing, covered it with matte film, and neatly pasted it along the waistline of the desks. The gray desks immediately gained a more lively breath.

After the latex paint on the walls dried, he asked design colleagues to design some decorative boards with corporate-culture content and paste them on the walls, making the office less monotonous.

He then asked designer Song Yu to buy a set of big red IKEA sofas and a white IKEA tea table, placing them at the entrance for reception.

They also ordered green plants from the flower market and placed them in corners. After this series of actions, the office became very different from before.

The total cost was only a little more than 4,000 yuan, including more than 2,000 yuan for the IKEA sofa. It also included replacing the corridor lights for free with Philips lights, because the corridor outside had previously used off-brand small lamps and was too dark. They voluntarily changed them to Philips high-wattage energy-saving lights, all the way from the office to the elevator entrance.

Zhang Hongfu could feel that they no longer looked like a feed company. He felt that partners' eyes began to show reflections from the lights. That bright environment could lift people's spirit, filling them with hope and vitality. From eyes to heart, a small flame was brewing.

Triple, Triple, Triple

Only this way could they be worthy of their conscience. Strike iron while it is hot: after raising wages and building the field, they could next build dreams.

At that time Zhang Hongfu did not yet understand these logics. He only felt they should adjust step by step the things he considered important.

They already had five or six direct-operated stores in hand: the Finance University store, Hangyuan store, plus the Dongfeng Road store, Zhengzhou University store, and North University Town store, which counted as private semi-direct-operated stores. In 2012, they planned to select more sites and open five or six new stores: Great Shanghai City, Foxconn, Jingmao College, plus two or three locations not yet selected but already in the plan.

At that time, the open franchise stores plus the winter-closed franchise stores totaled around fifty or sixty.

Zhang Hongfu called everyone together for a mobilization meeting.

They collectively discussed the situation. Zhang Hongchao had already returned to Kaifeng to build their Daka Food company. Ice-cream raw materials were now completely self-produced, so product quality and stability no longer needed to be worried about. The stores that had closed for winter the previous year were also gradually reopening. After the torment and hibernation of winter, franchisees were eager in spring. As long as raw materials were stable and products tasted good, they could fully self-activate.

If direct-operated stores doubled in number that year, and franchise stores doubled to exceed 100, then total shipment volume increasing twofold would be no problem. But this was still not enough. Zhang Hongfu hoped their stores could open with better quality. So he told everyone they must review new-store site selection and ensure every new store could survive and flourish. As long as those stores' business remained hot, they would continue ordering goods; Mixue's trading operation would be busy, and the company would have stable profit.

He explained their relationship with franchisees. He told everyone that franchisees were their relatives. These relatives brought two or three generations of family money to invest in Mixue stores: parents' and fathers-in-law's savings, money saved for buying a home, getting married, and raising children. Mixue had to guard the gate well and help them review properly. If there was no possibility of profit, they must not let the store open. Store survival and hot business were the only explanation they could give franchisees. Only this way could they be worthy of their conscience.

Only if franchisees were good would Mixue be good. Their future profit model should not be like fraudulent franchise companies that earn franchise fees. Instead, they should become a trading platform that continuously provides service. Old stores order goods, new stores open and order goods, and thus the system can live continuously and accumulate continuously.

If there were more stores and business was better than the previous year, tripling revenue would not be a problem. But for tripling, people might not have confidence, and motivation might not be enough. So they needed incentives.

At that time, most of them were rural bumpkins. They had never traveled anywhere and had never received big red envelopes at year-end.

So Zhang Hongfu asked designer Song Yu to design a long red banner and hang it on the side wall of the public office area, stretching from the east window all the way to the west door. In thick black type it said:

"Triple in half a year, travel to Hainan for summer vacation; triple for the full year, a 100,000-yuan red envelope for New Year!"

Do not underestimate 100,000 yuan then. At the time, the monthly wage expenditure for all company employees was only 17,000 yuan, and that was after wages had just been raised.

Small Bumps Promote Transformation

Share sweetness, pass on happiness.

After raising wages, changing the environment, and building a small dream, Zhang Hongfu finally began organizing corporate culture. In fact, he was embarrassed to talk about the term "corporate culture" then. He always felt the term was relatively empty. So he preferred internally integrating it into action, and was embarrassed to speak about it to partners. But ultimately it still needed to be preached.

Share sweetness, pass on happiness. This line first appeared in 2008 during the Olympics, when he printed it on the paper holder for their ice-cream cones. He could not accurately define whether it was a slogan or an operating philosophy. He only felt their ice cream represented sweetness. Passing one ice cream after another to partners and customers itself resembled passing the Olympic torch. It was a sweet and great thing. He hoped their partners would firmly become sweet messengers, sharing sweetness and happiness with other colleagues, franchisees, and finally every customer. For now, he calls it an operating philosophy.

Values: doing enterprise is doing personhood; foodservice is conscience. At that time, he did not think they were retail. He felt they belonged to a branch of foodservice. Foodservice means things that enter the mouth, so one must rely on conscience and use the best ingredients, not speculate, cheat, or falsify. He also believed doing enterprise is like being a person: one must be upright and proper, and cannot be like other franchise companies in the market, acting as a cheat.

Mission: let people around the world who love life enjoy high-quality, affordable deliciousness. On flyers Zhang Hongchao printed in the early days, the words "delicious, affordable, always fairly priced" appeared. Zhang Hongfu says he reorganized his brother's thought together with his own operating experience. He believed only people who love life can calm down and enjoy deliciousness. Their deliciousness must forever be high-quality and affordable, so it can possibly be sold to more people around the world. Only then does it count as the Buddhist idea of saving all beings. Or put differently, when someone eats a delicious product without needing to pay too much money, that itself is an experience of a good life, and because of the deliciousness, the person will love life more.

Vision: simple, focused, a respected hundred-year brand. At that time they not only said this; afterward they also acted this way. In the second half of 2011, they already had several business sections: the high-end store that had just been closed, Mixue Bingcheng Home-Style Restaurant, the main store, and the winter product lines in their stores such as popcorn and candied hawthorns. Although the company was not large, it had a pile of businesses. Zhang Hongfu believed this pile of businesses was not suitable for their better development. Without simplicity and focus, where could power come from? So that year he adjusted partners' work focus only to the main line of ice cream and tea drinks. Almost everything else was cut off.

After organizing these metaphysical and "empty" culture things, he told partners he did not want to print them out and hang them on the wall. He wanted everyone to deeply understand these four lines, then use them as work guides and action standards, integrating them into everyone's blood.

After that, his energy went into stores. He was not good at office management. He was accustomed to running outside; sitting in the office made his whole body uncomfortable.

That year he had two more major topics to handle. One was the soon-to-open Great Shanghai City store. The other was the readjustment of their two largest stores at the time: the Finance University store and the North University Town store.

First, Great Shanghai City. At the west gate of Great Shanghai City, there was an open area of about ten-plus square meters. Zhang Hongfu felt the location was especially good, so he tried every possible way to take that piece of land. The discussion with the mall was that he would build a small structure there himself and open a Mixue Bingcheng.

He prepared that store for nearly two months, from March until May Day. At that time they had not connected with a decoration company. A brother who often renovated for them took on the task of building the store. They were used to saving money, so Hongqi Ge personally did the work from welding the frame to interior renovation, electrical wiring, and water lines. They overcame countless difficulties, using the most durable and thick materials, wanting to build the store into a flagship. Finally, a few days before May Day, the renovation was completed. For better effect, Zhang Hongfu specially went to Beijing and spent a high price on two used American Taylor ice-cream machines, pulling them back to the store and preparing for May Day trial operation.

On May Day itself, he had just woken up when he saw many missed calls from Hongqi Ge. He hurriedly called back. Hongqi Ge said the store had just been demolished, and the ice-cream machines had been taken away by urban management. Zhang Hongfu drove quickly to the place and found Hongqi Ge sitting alone at the entrance of the store, which had already been demolished into ruins, with an expression of unprecedented dejection.

Hongqi Ge told him that that morning he was doing the final electrical tests on the store. Then about thirty urban-management officers arrived with DV cameras and professional acetylene-flame steel-cutting machines, saying they were creating a sanitary city. Their illegal structure had long been under key monitoring and would be professionally demolished as a model case for the sanitation campaign.

Zhang Hongfu held back the pain in his heart and comforted Hongqi Ge, saying that if it had been demolished, then let it be demolished. From now on, they would no longer open this kind of small store.

Before this, many Mixue Bingcheng stores were all temporary roadside structures, kiosks, or windows. From that point on, they decided to open only normal storefronts. Stable operation was most important.

The other matter he was busy with then involved the North University Town store and Finance University store, both of which were large: one 70 square meters, one 90 square meters.

He was very worried that their low-priced ice-cream and tea-drink products alone could not support such large storefronts. So in the stores he tried every possible way to divide areas and rent them out, introducing all kinds of other projects: bread and desserts, cube shops, fried chicken and hamburgers, and a duck-neck brand he created himself called Sauced Duck Zhang.

The source includes photos from those stores: Mixue pastry, Tianjin big candied hawthorn, and cube-shop areas.

The final result was that the cooperative bread and dessert project could never find suitable entrepreneurs. Either quality was unstable, or they worked three days and rested two, so bread and desserts never took off. The cube shop was even more of a pit. They installed cube-shop shelving on the second floor he had divided out. Bosses changed one after another, transfer fees became higher and higher, and in the end Zhang Hongfu could not even reclaim the space. For Sauced Duck Zhang, he found two brothers who knew how to make braised foods as suppliers, while his own employees sold it in the store. At the beginning it sold decently because product quality was good. But later quality became worse and increasingly unstable, while the supplier brothers began quarreling about splitting up after earning money. The duck-neck project could almost no longer continue.

Originally, introducing these things was meant to share Mixue Bingcheng's rent pressure. Unexpectedly, after introducing them, the pressure became even greater. Not only did they fail to make money, they created all kinds of conflicts. He simply shut them all down and changed the stores into independent large Mixue Bingcheng stores, placing tables and chairs in the empty areas for customers to rest.

The result greatly exceeded his expectations. After becoming independent stores, business was much better than before, and the money earned was far more than the rent from leasing stalls to others. Employees were also prouder, stores were prettier, the customer consumption environment was better, and it looked more like an independent brand.

That year, in store operations, they encountered these little bumps. But the bump of demolition made him never again open temporary small roadside structures. The bump of shared rented stalls made them from then on open only independent brand stores.

At the time, these trivial matters were hard to see through and made the heart suffer. Looking back today, how valuable those opportunities were.

A Single Sentence Wakes the Dreamer

If you are never inside your command tent, how can you strategize from within it?

From January to June 2012, because of the demolished Great Shanghai City store, the Finance University and North University Town stores that needed adjustment, and his own resistance to office work, after February Zhang Hongfu hardly went to the company. He never attended morning meetings, weekly meetings, or monthly meetings. The office side basically grew by itself.

The demolition of the Great Shanghai City store was actually a major blow to him, because they had invested enormous effort into that store, only for it to be reduced to ruins the day before opening. So one night in May, he drank gloomy wine with Zhao Jie, one of their franchisees.

After three rounds of drinking, Zhao Jie said, "Brother, I want to say something to you. I don't know whether I should say it."

Zhang Hongfu said, of course he should say it; say it quickly.

Zhao Jie said: "I feel you are not qualified as general manager. Look at you, wandering around outside in stores every day. Doesn't the office count as part of the company? You don't attend morning meetings. Every day you sleep until noon with your backside in the air. If you don't go to the company to arrange work and track progress, how can you know the company's development? For a leader, strategizing from within the command tent is very important. But you are never inside your tent. How can you strategize?"

In fact, Zhang Hongfu also felt somewhat guilty every day when he did not go to the company. Zhao Jie's words were like a basin of cold water poured over his head. It was true: he was usually too caught up in the fine details of store work. For the company's larger planning, and for franchisees' expectations, he had never built a systematic plan for how to establish deeper links with them. His relationship with office partners was also not especially close. He could feel that although they had a new office environment and higher wages, they still had some confusion.

The next day he went to the company and had a deep conversation with Zexu. Zexu said: "If you had not come to ask, I would have been too embarrassed to say it. Actually, we in the company also feel quite depressed. It seems that in your eyes there are only the few stores outside. Our office sites do not count as operating sites, and our office people do not seem like company employees. How many stores we open each month, how much monthly company revenue there is — you neither ask nor care."

Yes. Zhang Hongfu deeply reflected. As a leader, it is easy to be numbed by the trivial things before one's eyes, assuming that all important work is what one can see and touch every day. In the end one falls into being a firefighting team member for the things one can see every day.

What can be seen is mistaken for all there is. What cannot be seen is mistaken as if it does not exist.

Starting in mid-May, he finally went normally to the company to work. He did not have an office, only a workstation. But wherever he was, he could discover problems that could be improved. At that time they already had sixty or seventy stores, but business was generally not especially good. Most stores had daily revenue of only several hundred yuan to 1,000 yuan. The team discussed and prepared to hold a franchisee meeting. The meeting theme was called the 3000 Plan, because they hoped franchisees could raise each store's operating performance to more than 3,000 yuan per day on average. Only when single-store operating quality was good would everyone have more confidence, and confidence is more important than gold.

In early June, at the restaurant of a budget hotel near the company, they held their first franchisee 3000 Plan mobilization meeting. That meeting was a first experience for each of them. They rehearsed their speeches at least twice in advance. Speakers included Zhang Hongfu, Zexu, Quanjin, and others. As the meeting approached, they faced it as if facing a great enemy, sincere and fearful.

In mid-June, the meeting was held on time. It was the first time in their lives several of them had spoken in front of seventy or eighty people. After the whole speech session, their palms were full of sweat, and their T-shirts were soaked. Fortunately, they had prepared thoroughly, and the meeting was very successful. Franchisees felt a different atmosphere and determination, and one after another expressed that they would work hard to operate. Reaching a daily average revenue of 3,000 was not a dream.

Immediately afterward, Zhang Hongfu and Zexu went down to inspect stores. They could clearly feel that the situation was much better than what they had seen when visiting stores the previous year. By July, finance calculated that first-half revenue had indeed more than tripled compared with the same period the previous year. So the summer vacation travel plan went to Hainan as hoped. He notes that he cannot quite remember; perhaps because some people disliked the heat, they eventually went to Yunnan.

In the second half of 2012, they not only had stable ice-cream raw materials; the quality of coffee, fruit juice, and milk tea products was also decent. Business continued improving. By year-end, they could split the 100,000-yuan red envelope.

That year's year-end summary meeting was held in their own office. The office had expanded by two rooms, across from the old office. Usually those rooms served as the planning department's office. For the annual meeting, they cleared the desks and computers and freed a separate room of more than 30 square meters. In that room, they gave out red envelopes, distributed various three-piece bedding sets purchased by finance, and a newly joined partner named Wang Huan performed nunchucks. In the final summary speech, Zhang Hongfu told everyone that this was their first annual meeting, held in their own office, and also the last time it would be held in their office, because next year they would strive to find a star-rated hotel for the annual meeting.

That year, they decided to establish a new department: the Reclamation Department. The goal was 2013: go reclaim Wuhan. The reason it was called Reclamation Department was that at the time Zhang Hongfu did not know the term "expansion department" existed. Was that rustic enough?

He adds in parentheses that the next day he would verify with finance; he remembered that the annual-meeting red envelopes that year were not limited to 100,000 yuan. Because revenue had smoothly more than tripled, they were happy and may actually have distributed 150,000 to 200,000 yuan in red envelopes.

Come, Drink This Cup of Lemonade

Have patience, have sincerity, and even more, have a conscience that can withstand temptation.

If the lemonade matter had truly been shelved, there would have been no further story. But sometimes fate is that miraculous. Because of another set of circumstances, their path intersected again with Miss Geng's store and with two-yuan lemonade. Even though those events were painful and unbearable to look back on, in the end lemonade and Mixue achieved the proper result.

At the time, Mr. Zheng's Luoyang Shanghai Market pedestrian-street store was doing very good business and suddenly became Luoyang's number one. So relatives and friends around him began franchising one after another: some in Shangqiu, some in Xi'an, some in Taiyuan. In short, Mixue saw the strong capability of Fujian merchants. At this time Mr. Zheng was also actively mobilizing all resources around him to find stores. Very quickly, he found an excellent new location beside Miss Geng's Henan University of Science and Technology store: the first shop on the main street of the pedestrian street at the university's front gate.

This was destined to be a tangled beginning. After all, old franchisee Miss Geng's store was only seventy or eighty meters away. But Mr. Zheng was formidable. His power was not merely shown after finding this store. Before that, every time Mixue people went to support and help his stores, he generously and boldly drank them dizzy, including Zhang Hongfu himself.

In addition, after so many years of moving through the jianghu, he had accumulated strong persuasive ability. He said: "Look, this location we found — even if you gave Miss Geng ten years, she could not get this kind of house. I got it through layer after layer of relationships. And look at the position Miss Geng operates. With such high traffic on the main street and at the school, she has no courage to take a store there. Instead she opened a small store in a very remote spot nearby. Hygiene is not good, management is poor, output and service are ordinary... You are doing business, not charity. Of course you should encourage opening whichever store has greater benefit. You cannot only consider the old franchisee's personal feelings and act emotionally."

Then they began persuading themselves. Miss Geng's store was indeed quite far, although only seventy or eighty meters; it was indeed quite remote. It was right to allow capable franchisees to open good stores on main streets. They should not be too partial or mix feelings in, affecting rational judgment.

So they tacitly allowed Mr. Zheng to take that main-street location. The matter was soon known by Miss Geng. After that, Miss Geng and Mixue fell into infinite pain. The most painful, first of all, were surely Miss Geng and her husband. They had worked hard operating for so many years and still had not saved much money. Before they had the ability to take a large store at the entrance, a wealthy operator arrived and directly opened a big store at the door. On one hand, had her own opportunity to open a main-street store been lost? On the other, would her small store be affected by this large store?

Mixue, in order to let Mr. Zheng open smoothly, did all kinds of ideological work, trying to persuade Miss Geng that her business would not be affected. But in fact, how could that be easy to persuade? That period forced Miss Geng into such suffering that her nerves weakened. Her husband also called Zhang Hongfu, crying and hysterical in every way.

But ultimately an arm cannot twist a thigh. Mr. Zheng's store opened on schedule as usual. Under this pressure, Miss Geng also opened a store at that street corner, directly opposite Mr. Zheng's store. That painful experience is unbearable to look back on, but in the end things had become that way. Everyone stopped arguing and began thinking about how to make business better.

Miss Geng and the others raised the lemonade matter again. In the back-and-forth mediation process, Mixue also learned more and more about the business of the neighboring lemonade shop. They also felt they should add a product with fresh lemon. Miss Geng strongly recommended it again and again, saying that if Mixue made the product, they had confidence they could sell it better than the two-yuan lemonade shop. The matter of adding lemonade, at the entrance of her store, was thus quietly decided.

Once the goal is determined, path and technology are not obstacles. Very quickly they made the lemonade formula. Two words: tastes good. Three words: tastes very good. Four words: tastes extremely good.

The first-generation lemonade sold for three yuan in a large 700-milliliter cup. After the lemon was pounded, hot water was used to dissolve white sugar into it. Efficiency was extremely low.

Very soon, their store partners figured out by themselves that the white sugar could be melted into solution in advance. This raised efficiency unprecedentedly. Then the product sold better and better in stores, and they continuously optimized its method, ratio, and cup type. Half a year later, they raised the price to four yuan, increased the lemon content, replaced powdered white sugar with liquid syrup, and later optimized the lemon muddling stick. In short, output became faster and faster.

Actually, at the same time lemonade launched, there was another product called Rocking Grapefruit Ice. At the early stage of launch, Rocking Grapefruit Ice sold better than lemonade. But when the product itself is weak, it has no long-term life. Rocking Grapefruit Ice was made with grapefruit jam and simply did not taste as refreshing, sweet, and clean as lemonade. Very soon, its sales slowly declined.

When lemonade first launched, it was not yet called lemonade. To show off elegance, they named it Ice-Extracted Lemon, with the advertising slogan "hand-muddled lemonade." As customers called it, they called it lemonade. Nobody called it Ice-Extracted Lemon at all. They simply followed customer demand and called it lemonade.

Whoever pays money is beautiful. Whoever pays money is right in whatever they say. Customers pay money; customers are beautiful; customers are right in whatever they say. All the little thoughts and schemes cannot compare to customers' cognitive power.

From then until now, lemonade became the company's second major heavyweight product, with sales second only to ice cream. As for whether the cups connected together could circle Earth several times, or equal several Himalayas, or reach from the Moon to Earth, Zhang Hongfu has not calculated. In short, it is very powerful. The reason it has life, beyond being refreshing, fresh, and sweet, is also that its pricing is especially grounded. From the end of 2013, when it began selling at four yuan, to the time of the memoir passage, six years had passed without a price increase. But in every cup, the amount of lemon had been increased three times by weight.

Some time earlier, at the Guomao South Gate store, he saw several employees wearing Nayuki uniforms come to Mixue to buy lemonade. One introduced it to another partner, saying Mixue Bingcheng's lemonade was the best lemonade she had ever drunk. Zhang Hongfu felt happy and pained. Happy because they truly knew goods. Pained because their own products cost more than thirty yuan a cup, yet their own employees still went to Mixue to buy product. He always felt it was somewhat ironic.

Perhaps Mixue is the summer savior of girls from the "slums," he jokes. No matter what others say or how they look at it, he only hopes their customers can be relaxed and without pressure. As long as customers like it, and as long as Mixue can still bear it, they will always walk the mass line.

In this matter, the franchisee who endured the most painful torment at the time and made the most outstanding contribution was Miss Geng. Mr. Zheng, who opened directly opposite her, later took all his relatives' stores and collectively changed signs, starting a competing business that copied Mixue.

That incident also gave Zhang Hongfu a deep lesson. Developing one's own customers, or cultivating one's own employees, is like planting small saplings. One cannot always hope that a thick fruit tree will arrive all at once and enter harvest season as soon as it is planted. One must have patience, sincerity, and even more, a conscience that can withstand temptation.

In earlier years, they also gave Miss Geng a cash award, although compared with the huge matter of lemonade, it was insignificant. Later her store operated better and better. A few days before the memoir passage, he had seen the couple at a meeting. He had never felt comfortable telling them the unease and guilt inside his heart about that incident. But he feels that after enduring such great grievance and making such a great contribution, her name should be known by everyone:

Geng Jingjing, I'm sorry, and thank you. Let us keep going together.

—— FoodBud English Translation of the Source · Part 8 Ends ——

3. FoodBud Notes

1. This is the formal beginning of Zhang Hongfu's operating authority. The memoir frames power as a tool for service and execution, not status. The request that other shareholders step back for a year is drastic, but it gives the company a single operating center.

2. The office renovation is culture made physical. Warm light, rose red, plants, sofas, and corridor lamps are not decoration alone. They are Zhang Hongfu's attempt to make employees feel that Mixue is sweet, young, and alive.

3. The franchisee model is explicitly moralized. Franchisees are described as relatives investing family savings across generations. This becomes the argument against one-time franchise-fee extraction and for ongoing supply and service.

4. The 3000 Plan shifts attention from store count to store quality. The target is daily store revenue, not just openings. This is an early sign of the later tension every franchise system faces: growth is only valuable if stores survive.

5. Lemonade is born from conflict, not a clean lab story. The product succeeds through customer naming, store-level process improvement, and grounded price. But the origin also leaves Zhang Hongfu with guilt toward Geng Jingjing, which he preserves rather than smoothing over.

4. Timeline (this installment)

  • Late 2011 / early 2012 — Zhang Hongfu asks to become general manager and take full operating authority for the chain-franchise business module.
  • 2012 — Tao Ge and Manager Zhang start a trading company; Zhang Hongchao returns to Kaifeng to build the ice-cream-powder factory; Zhang Hongfu runs the brand and franchise business.
  • Early 2012 — Office environment is redesigned on a small budget with warm light, ivory walls, rose-red desk wraps, culture boards, IKEA sofa, and plants.
  • 2012 — The team sets the "triple growth" incentive: half-year growth for a summer trip, full-year growth for a 100,000-yuan red envelope.
  • May 2012 — The Great Shanghai City flagship structure is demolished before trial operation.
  • June 2012 — Mixue holds the first franchisee 3000 Plan mobilization meeting.
  • Second half 2012 — Business improves; revenue more than triples year over year in the first half, and year-end bonuses are distributed.
  • 2012–2013 — The Luoyang franchisee conflict around Geng Jingjing's store leads to the fresh lemonade product.
  • Late 2013 onward — Lemonade sells at four yuan, with lemon content later increased multiple times by weight.

5. Pull Quotes (web-ready)

1. *"I wanted power, but not for the sake of power."* — Zhang Hongfu (translated from the source text) 2. *"Franchisees are our relatives."* — Zhang Hongfu (translated from the source text) 3. *"What can be seen is mistaken for all there is. What cannot be seen is mistaken as if it does not exist."* — Zhang Hongfu (translated from the source text) 4. *"Customers pay money; customers are beautiful; customers are right in whatever they say."* — Zhang Hongfu (translated from the source text) 5. *"Geng Jingjing, I'm sorry, and thank you."* — Zhang Hongfu (translated from the source text)

Series navigation

*Before the Castle: How Mixue Was Really Built, 1997-2017 · Part 8 of 12 · FoodBud /insights*

*This is a translated and annotated edition, not an original FoodBud interview. Authorized translation: translated with permission from Zhang Hongfu's memoir (经授权翻译自张红甫回忆录). Original author/source: Zhang Hongfu (张红甫). The translated source is kept separate from FoodBud's Editor's Note, FoodBud Notes, timeline, and pull quotes.*

*Publication note: corporate data is primary-source-locked to HKEX filings where stated. Market capitalization and any FY2025 GMV / systemwide-sales figure are intentionally not stated. “Scale” means systemwide sales / GMV and store count, never company revenue. FoodBud is information only, not investment advice.*