New Tea Drinks 2025: Snow King "Shifting Gears", Bawang "Stalling"

Ask AI · What are the deep-rooted reasons behind Bawang Tea Princess avoiding price wars and its growth losing momentum?

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“Key Takeaway”

When every tea shop starts “going all-in” on homogeneous coffee, can the story of reaching 10,000 stores for new tea brands still continue?

**Author | **Gao Yuzhe

**Editor | **Liu Yang

The past year has not been peaceful for the new tea beverage market.

The months-long “takeout battle” has turned into a contest among platforms, brands, and consumers. “Free-for-zero” deals, 1-cent milk tea—these seem like users are “gathering freebies,” but behind the scenes, franchisees are bearing the losses, and brand owners are doing business by “slitting the goose for its eggs” under the pressure of platform algorithms. This price war is like a mirror, clearly reflecting the real situations of six listed tea beverage brands—Mixue Bingcheng, Guming, Shanghai Auntie, Nayuki, Chabaidao, and Bawang Tea Princess.

In terms of annual performance, the gap among the six companies has become increasingly obvious. Mixue Bingcheng’s revenue continues to lead; Guming has squeezed out profits second only to Mixue Bingcheng; Nayuki is still struggling through a difficult transformation, constantly closing stores to cut losses; and Bawang Tea Princess has begun to face the predicament of slowing growth.

With subsidies fading away and consumption returning to rationality, the era in which the new tea industry relied on crazy store openings to tell growth stories is coming to an end. Now, the focus of competition is no longer who can open stores faster, but who can survive longer through improving operational efficiency and more refined management in a saturated market.

1. Snow King and Bawang: the dilemma of growth

Among all the performances, Mixue Bingcheng’s results are worth a close look. Behind 33.56 billion yuan in revenue, the main highlight of its growth does not come from its flagship brand, but from its sub-brand Lucky Coffee’s “lightning-fast” expansion.

In 2025, Lucky Coffee grew from about 4,600 stores at the start of the year to over 10,000 stores by November. This expansion speed is extremely rare across the entire new tea beverage industry. But at the same time, in a call with investors, the newly appointed CEO Zhang Yuan frankly admitted that in the fourth quarter of 2025, store sales revenue growth further slowed compared with mid-year and the third quarter.

This slowdown cannot be attributed entirely to the fading of delivery subsidies. Although Zhang Yuan’s explanation was that orders accelerated their shift to online channels, which disrupted the group’s strength in offline-to-store operations, the deeper problem may be that Mixue’s product innovation capability has not kept up with changes in the market.

In 2025, Mixue Group’s R&D expenditure was 101 million yuan, down 3.4% year over year. On the product side of the main brand, it still mainly relies on classic hero products priced at 4–10 yuan. There has been no obvious breakthrough in the speed of new product iteration or the ability to create breakout hits. For a business model that depends on standardized products with long shelf life, this system is highly efficient when selling iced drinks in summer. But when winter comes—when consumers are more inclined toward freshly made, new hot drinks—the shortcomings in product power become evident.

Bawang Tea Princess, however, is almost the opposite situation: it has product strength and brand momentum, yet the 2025 financial report data does not look good.

The financial report shows that Bawang Tea Princess’s net revenue in 2025 was 12.91 billion yuan, up 4% year over year; its adjusted net profit was only 1.91 billion yuan, down more than 20% year over year. Even more noteworthy is the fourth-quarter data: in the Greater China region, average monthly GMV per store fell 25.5% year over year to 337,000 yuan.

Some of the impact may be because Bawang Tea Princess did not participate in the takeout battle. Regarding their stance on the takeout battle, Zhang Junjie said very clearly in an earnings call in August last year: participating in the price war would harm franchisee profits and also damage the brand positioning. The judgment was correct, but the cost was immediate. When consumers got used to buying milk tea on delivery platforms with subsidy coupons, Bawang Tea Princess’s insisted-upon high-price offline model was pushed to the margins.

More complicatedly, in the second half of 2025, Bawang Tea Princess simultaneously switched its business model—from making money from the margin on selling raw materials to sharing revenue based on GMV. This was originally meant to “bind interests” with franchisees, but under the impact of the takeout battle, store GMV declined and headquarters revenue also fell. The new model had not yet been fully worked out, and performance was already under pressure first. In a call on March 31, Zhang Junjie admitted that “we underestimated the complexity of organizational adjustments, and in 2025 we basically wasted about half a year.”

For 2026, Bawang Tea Princess’s guidance was that “revenue and profit will be basically on par with 2025.” That means it needs to spend the entire year digesting the strategic mistakes of 2025 and to verify one question: in a market where new tea beverages have already been redefined by the price war, is the path of insisting on brand premium still workable?

2. The frenzy and hidden concerns of the takeout battle

From April to August 2025, a record-breaking, most intense takeout battle launched by the three major platforms swept across the country. Subsidy methods like “0 yuan purchases,” “1 yuan to drink fresh fruit tea,” and large-value storewide reductions were rolled out one after another. Consumers stocked up on milk tea at nearly zero cost, and the new tea beverage industry became the direct beneficiary of this traffic contest. At the same time, however, platform commissions and other fees also put franchisees under a dual squeeze of costs and profits.

For tea beverage brands that rely mainly on franchising, this was a “passive carnival.” According to a report by Cailian Press, during the “zero-yuan purchase” campaign, Guming’s daily order volume could reach 2–3 million; same-store GMV growth exceeded 20%. But the take-home revenue per order was only 4–5 yuan. Guming’s Chairman Wang Yun’an believed that lower-priced brands would relatively benefit more, but in the long run, this is not conducive to healthy operations of franchised stores.

In this war, Mixue Bingcheng was one of the few brands that truly benefited. According to calculations by Zheshang Securities, its average contribution from product sales per store in the first half of the year reached 278,000 yuan, up 13.2%. The reason is simple: even after subsidies, Mixue’s prices remain within consumers’ psychological expectations, and it will not be “redefined” by the price war in the way higher-priced brands are.

Chabaidao’s data explains the issue even more clearly. In the mid-2025 performance meeting, management stated that in the second quarter, average daily GMV per store reached the highest quarterly level in nearly a year, rising about 15% quarter-over-quarter compared with the first quarter. But this growth depended almost entirely on the delivery platforms’ “staged promotional activities.” In Chabaidao’s mid-year financial report, it said that promotions from external channels created a “supplementary pull” effect on store revenue. In other words, once subsidies fade away, whether this growth can be sustained is a question mark.

Nayuki, which was deep in losses, instead treated delivery as a “lifeline.” For the full year, the proportion of delivery revenue for the first time exceeded 50%. Within that, third-party platform orders accounted for 49.1%, nearly contributing to half of total revenue.

But the cost was obvious. In 2025, Nayuki paid delivery service fees of as much as 462 million yuan to delivery platforms, a significant increase from 346 million yuan in 2024. The share of this cost relative to total earnings rose from 7.0% to 10.7%. Meanwhile, income from store dine-in ordering and self-pickup orders both declined. This structure means that the large-store model and the “third space” experience that Nayuki invested heavily in early on have basically become ineffective. High rent and labor costs did not bring corresponding in-store foot traffic; instead, they became a heavy burden.

The take rate from delivery platforms further eroded profit margins. Nayuki’s net loss in 2025 was 240 million yuan. Although this narrowed significantly from 918.7 million yuan in 2024, this was mainly because 152 loss-making stores were closed, not because of a truly improved operating quality.

3. Is turning into “Luckin” the way out?

With years of expansion by new tea beverage brands, Mixue Bingcheng’s global store count has nearly reached 60,000. Guming and Shanghai Auntie each have more than 10,000 stores. Even Chabaidao’s store count exceeds 8,000. Obviously, under competition with new products that are hard to “outdo” and stores that are saturated, the growth model relying solely on store openings can no longer continue. The “10,000-store story” of new tea beverages is no longer new, and finding a “second growth curve” is becoming a consensus across the industry.

Without any prompting, multiple brands have set their sights on the coffee track. Among them, Mixue Bingcheng and Chabaidao are piloting freshly made coffee in some stores and launching multiple coffee products; Guming is equipping 12,000 stores with coffee machines; and Shanghai Auntie is trying to integrate its “Shanghai Coffee” business into the main brand.

Brands are collectively betting on coffee mainly because coffee can complement tea beverages with a “morning C, evening A” pattern. Generally speaking, coffee sales peak in the morning, while tea beverage consumption peaks in the afternoon and evening. With store rent and labor costs fixed, introducing coffee can effectively fill the slack in the morning, improving per-store revenue and profit.

In addition, according to a report by The Beijing News, Shanghai Auntie has told the media that coffee has a relatively higher gross margin. And coffee is more standardized in its preparation, with lower raw material waste. Once scaled, it is easier to reduce costs.

However, the coffee track has long been a red ocean. Under the “9.9 yuan price war” by Luckin and Kudi, consumers’ price expectations have been lowered again and again. If newly entered tea beverage brands join in the low-price “tug-of-war,” they will significantly compress brand profitability. If they compete on quality instead, they will need to add costs for coffee bean varieties and professional equipment.

This leads to a dilemma: it’s hard to profit from low-price coffee; high-quality coffee costs a lot and takes time to build consumer recognition. Clearly, coffee is not a “blue ocean” market where one can “lie back and earn.”

Besides coffee, brands are also trying other diversification paths, but the results do not seem significant. For example, Shanghai Auntie and Nayuki have tried launching fruit-and-vegetable teas, baked goods, and low-GI light meal products, but at this stage they are mostly used as supplements to brand business and consumption scenarios.

Overseas expansion is another direction brands look to for incremental growth. Currently, Mixue Bingcheng has more than 4,000 overseas stores. Bawang Tea Princess’s overseas performance is also relatively strong, with overseas GMV growth of 84.6% in the fourth quarter of 2025. Moreover, Shanghai Auntie has only 45 stores overseas, while Guming, Chabaidao, and Nayuki still focus mainly on the domestic market.

Clearly, under the dual pressures of market saturation and low-price “price wars,” China’s freshly made tea beverage market is shifting from an incremental market to a stock market. According to data from iiMedia Consulting, since 2025, the growth rate of China’s tea beverage market has slowed to 5%–7%. In the future, brands in a stock-based competition that want to achieve sustainable growth will still face a long-term battle of shifting from “scale expansion” to “efficiency competition.”

Author’s Statement: personal views are for reference only