I was forced to start the second round because I was raised in poverty

Chapter 180 Do You Know Coffee?

They have mixed so many new products, why are they taking them off the shelves?

The situation between the two sides was tense, so Tang Ke simply invited Su Cheng to a duel.

"Why is it being taken off the shelves? Can you explain why?"

Su Cheng accepted it with pleasure.

"If you are willing to ask, Doctor Tang, I will explain it to you."

Ye Li and the other two seemed to hear the bell from the boxing ring ringing in their ears.

Is this a literary fight?
wrong.

Ye Li quickly rejected this idea.

Is this a battle of ideas or a fight of arms?

Whoever has a quick mind will be faster in the ring.

Whoever has rich knowledge and accumulation has bigger muscles.

Ye Li was not worried about Su Cheng's defeat, because in her eyes, Su Cheng was a hexagonal warrior.

Su Cheng threw a jab first: "Why don't you come down?"

"Are you asking me or am I asking you?"

"I ask you."

"Okay, then I'll tell you why not."

Tang Ke has really put a lot of effort into researching recently, so he can really explain it clearly.

Tang Ke used a famous coffee shop as an example and expressed his point of view in an orderly manner.

The successful coffee shop has 28 drinks for customers to choose from, including specialty drinks and teas, and its non-coffee products account for 37% of its profits.

Tang Ke first made changes to the menu, placing the new products with the highest gross profit margin in the focal area and marking them with the [hot] logo.

Some drinks may seem to have low sales, but they can significantly increase customers' waiting time.

Take the turmeric latte for example.

Although he only makes less than 10 orders a week, he has calculated that it can extend customers' stay in the store by 9 minutes.

These nine minutes should not be underestimated.

Because six or seven of these ten customers bought croissants and pastries sold in the cafe, the probability of consumption increased.

This is one of them.

Second.

Tang Ke wants to help Tang Li capture users of all ages.

According to a survey, young people aged 18 to 24 prefer drinks with milk cap.

Elites aged 24 to 35 have a strong need for American coffee and latte.

Customers over 35 years old prefer health-conscious drinks, such as [Goji Berry Latte].

These drinks now are not enough.

Tang Ke also plans to launch limited editions in specific seasons, which can greatly increase sales in the off-season.

Take winter for example.

He planned to let Tang Li serve a cup of [mulled wine coffee] which is sold in almost all coffee shops.

Third.

Tang Ke wants to improve the operational efficiency of the coffee shop and use the supply chain to deeply explore the value of data.

The approach he takes is to reuse raw materials.

Develop new coffee using the same milk base.

Take oat milk, for example.

The store’s eight coffee types, including [Dirty Latte], [Matcha Oatmeal], and [Oatmeal Cappuccino], all use the same milk base.

This can greatly reduce procurement costs.

Tang Ke has already calculated the cost and found that the cost can be saved by 25%.

As Tang Ke stated his thoughts, Su Cheng shook his head.

This really pissed Tang Ke off: "What do you mean by shaking your head?"

"Shaking my head means I don't have the heart to interrupt you, but I don't agree with what you say."

Tang Ke: ???
You ride a horse!
"So you have an explanation for pulling so many new products off the shelves?"

"That's all, right? It's my turn now?"

Su Cheng snorted coldly.

Tang Ke can't even punch.

You don’t know how to fight, right?
Then Su Cheng came to help him fight.

The first point Tang Ke mentioned is the long tail effect.

When customers order items that require a longer wait time, such as bread, the probability of consumption does increase.

But this is only limited to customers who have plenty of time to sit and drink in the store.

Everybody is in a hurry to leave!

North America focuses on efficiency and time?
Don't compare them together then.

In terms of time and efficiency, who can compare with the Kings of Rolls in Kyushu?

Everyone wants to inject caffeine into their blood as a stimulant to turn themselves into a 24-hour perpetual motion machine.

The purpose of the long tail effect is to increase the average order value.

But the average customer spending at Tangli Coffee Shop is already high enough, at around 80 to 90 yuan per person. There is probably no other coffee shop in Jingzhou that can match it.

There is no need to use this kind of thing to push up the price.

Su Chengyuan called it: adding legs to a snake.

Su Cheng's plan focuses on attracting repeat customers.

If old customers realize that they spend more than a hundred yuan every time they come, they will start to calculate the bill.

On the contrary, it will affect his playing style.

He didn't want to say too much about the second point. Tang Ke didn't even understand the target group.

Su Cheng went straight to the third point.

The overall cost of raw material procurement does seem to have been reduced.

But it's just data on paper.

Tang Ke’s approach can reduce the raw material cost from 150 yuan to 100 yuan.

But the oat milk, which was supposed to cost only 10 yuan, was raised to 30 yuan.

He asked, if I don’t feel good after drinking one type of oatmeal coffee, will I still buy the other 7 types of oat milk-based coffee?
Definitely not!
Or let’s say I’ve been drinking oat milk these past two days, but I want to change the flavor, will I still buy the other 7 types?

The original raw materials are similar and are distributed reasonably according to sales volume.

But if you produce so much oat milk, you will end up having to go bankrupt if you can’t sell it.

It seems that the cost is reduced, but in fact it increases the inventory loss of raw materials.

It's just that the money saved is lost in another way.

This approach is like trying to cover up one's mistakes and is completely useless.

"Then it will be useful if you take them all off the shelves?"

"I'm not removing all of them from the shelves, I'm only removing part of them."

“If we only keep three new products, what’s the difference between that and removing all of them?”

"Of course there is a difference."

Su Cheng responded to Tang Ke's questioning using a reasonable experiment:

When a supermarket offers six different bread samples, only about 30% of customers will buy them.

But when the number of bread types increased to 24, the purchase rate of these breads was only 3%.

It dropped tenfold!
They had discussed this on the way here just now, and jokingly said that Tang Li was making it difficult for his employees, as they had to memorize so many formulas every day, which might make it easy for them to get confused.

Su Cheng now has something to add.

Tang Li not only makes things difficult for his employees, but also for his customers.

The core logic behind Su Cheng removing so many coffees from the shelves is to reduce options for customers and shorten the time it takes to make decisions.

New customers are bewildered by the sight of so many coffees. Which one should they order? In the end, fearing a disappointment and missing out on a coffee with good sales and a good reputation, they resort to the most popular Americano or latte.

Even if customers choose ordinary coffee, they will most likely find it unpalatable.

Because the more options provided, the higher the probability of doubting whether you have made the right choice.

The number of options and decision-making efficiency have an inverted U-shaped relationship, with the sweet spot being between 5 and 9 options.

And Tang Ke made a mess of the menu.

It’s not as good as the menu Tang Li made himself.

The menu created by Tang Ke did not classify the types of coffee such as latte, Americano, and thick milk at all, and directly threw those obscure French words and translations in the customers' faces.

Anyone who sees it will be confused.

Baymard Institute, an independent network research institute in Denmark invested by Dihao Group, has conducted many such experiments.

If there are 50 kinds of yogurt in the supermarket freezer, people will not know which one to choose for a moment and will most likely give up buying it.

But if you divide the yogurt in the supermarket into three types: low sugar, high protein, and probiotics.

Then customers' decision-making time will be greatly shortened, specifically by more than 42%.

When a company offers two pension plans, 75% of employees participate.

But if a company offers 59 retirement pension plans, the participation rate plummets by 25%, with only half of the employees participating, and the returns from the choices they make are even lower.

A research institute also invested by the Emgrand Group has also conducted experiments to prove this:

The average millennial faces more than 10,000 career options.

However, 29% of graduates delayed finding employment due to fear of choosing the wrong career.

In addition, people who frequently change jobs have a 22% lower job satisfaction than those with stable employment.

A domestic institution of Dihao Group that specializes in providing research for databases once conducted a survey on the marriage and love circle.

Regardless of gender, the quality of decision-making begins to decline after blind date participants have met seven partners, which is consistent with the cognitive upper limit of mate selection in evolutionary psychology.

This even applies to dating apps.

After users swipe left and right to match 500+ potential matches, the interaction rate drops 20% compared to when they match 47 people.

This is why, after a successful match on dating apps like Tantan and Tinder, in addition to the matching delay caused by low user stickiness, the more important reason is that users make too many decisions.

The smartest way is to swipe right endlessly until everyone nearby clicks [Like], without making any choices.

It may seem like Aquaman behavior, but it is actually the most efficient way.

Wait until the user is successfully matched before making a choice. If it is what you want, say hello. If it is not what you want, cancel the match.

It may seem like a bit of Aquaman behavior, but it is actually the most efficient way to quickly stand out from the boys who don’t speak after matching.

Various examples illustrate this.

When options are overloaded, users will avoid making decisions and make random choices.

Passersby stopped and looked at Su Cheng's table intentionally or unintentionally.

The coffee machine in the kitchen was a bit noisy. They watched Su Cheng and Tang Ke arguing with each other, but they couldn't hear clearly what they were arguing about.

However, just by looking at their expressions, one can tell that they are at loggerheads with each other.

Soon someone recognized Su Cheng as a member of the Dihao Group.

"Is the little badge on their chest the Emgrand Group?"

"Seems to be……"

"Oh my god, I actually ran into someone from the Emgrand Group here!"

"Is he from the consulting department?"

"That should be it. At first I thought they were coffee tasters. There were so many coffees on the table and even a mouthwash bucket."

"Does that mean the owner of this store hired someone from the consulting department of the Emgrand Group to help him run the business?"

"It seems like this."

"So what are they arguing about?"

"I don't understand either. They paid a huge sum of money to the Dihao Group to improve their operations. Shouldn't they just accept everything they ask for?"

"The man arguing with him doesn't seem to be the owner, but his relative, the man in the apron next to the owner."

"Killing me."

"The Emgrand Group is so terrifying."

"If I buy coffee here, does that count as contributing to the income of the Emgrand Group?"

"We pay the coffee shop, and the coffee shop pays the Dihao Group, so that must be counted."

"I didn't expect that the Dihao Group would make money from me just by buying a cup of coffee."

"No, I have to take a picture and post it on WeChat Moments."

Many passers-by secretly pointed their cameras at the table where Su Cheng and others were sitting.

One of the passersby posted three pictures on his Moments, two of which showed quarrels, and one showed himself holding the coffee he had just bought.

The copy reads: [A few grown men were arguing about how to run a coffee shop. Then they saw the real-life Emperor K7 and K8. Also, I highly recommend this coffee, it's delicious!]
It wasn't just passersby who stopped to look.

Even Ye Li, Qin Fen and Zhang Yangwen were stunned by the combination of punches Su Cheng threw.

Not buddy.

Aren't we just here to go through the motions?
Did you really research the menu?

The three of them couldn't help but feel curious.

Had Su Cheng thought about it a long time ago?
Are you really not prepared?
Was it improvisation or had you thought about it on the way here?

Or when Su Cheng took Zhang Yangwen to look at the plan, had he already studied it along that line of thought?
Winning is definitely guaranteed.

But Su Cheng's punches were so beautiful.

Su Cheng could see that Tang Ke had indeed studied some famous success cases.

The example he mentioned at the beginning should be the % Arabica coffee shop, so he wanted Tang Li to imitate this model.

But what Tang Ke may not know is that % Arabica’s first store in Hong Kong Island in 14 only had 4 basic coffees.

Therefore, in order to suit his own tactical plan, Su Cheng had to adjust the product categories and remove most of the coffee from the shelves.

"If I follow your approach, I can launch several new products every week."

"Whether the employees can do it skillfully is one thing, but the more important thing is that it embarrasses the customers."

“Putting aside these French names, which one do you want customers to buy?

"You probably won't buy the last new product, so you won't be able to test out any new products."

Tang Ke was completely disoriented after being beaten by Su Cheng's perfect combination of punches.

The most important thing was that Su Cheng was still dancing with the butterfly step, so he couldn't find any chance to throw a few punches against Su Cheng.

For a moment, Tang Ke was speechless.

Su Cheng’s suggestion is to adopt a dynamic menu.

Slow-selling items with weekly sales of less than 10 cups will be automatically replaced with new products.

The advantage of doing this is that you can get early warning of the raw materials for hot-selling products and replenish the stock.

The inventory of raw materials for the top 3 or top 5 sales can be greatly increased.

Iterating 30% of the SKUs every quarter can not only maintain freshness without affecting the core product line, but also test the real popularity of new products.

If it’s good, you can prepare more ingredients.

If sales exceed the regular items, it can be put on the menu permanently.

But ultimately, the rate of coffee that can be sold must be maintained at around 70%.

Tang Ke looked confused: "What does this mean?"

Su Cheng was confused by him.

"That dynamic menu you mentioned."

Su Cheng: ???
Isn’t this easy to understand?

You are a great doctor, but you don’t know how to use the dynamic menu?
"What do you mean? Haven't you played the game?"

"Quesanti's Secret Shop, the weekly Jade Purifier in the web game Dream Westward Journey 2, Onmyoji, Freeblade, Divine Right, PlayerUnknown's Battlegrounds, and DNF all have similar practices."

"Oh, I forgot. You don't understand at all."

"Then I'll give it to you, Great Doctor."

Tang Ke: ???
(End of this chapter)