Executive Summary
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– Jiumaojiu Group’s flagship brand, Tai Er Sauerkraut Fish, is in a steep decline, closing 68 stores in six months and seeing revenue drop 13.3% year-on-year in H1 2025.
– In a dramatic pivot, Tai Er is rebranding select stores to “New Tai Er·Fresh Ingredient Sichuan Cuisine,” emphasizing live fish and fresh cooking to distance itself from a “pre-made dish” scandal.
– The entire酸菜鱼 (sauerkraut fish) category is contracting after peaking in 2022, forcing Tai Er to enter the hyper-competitive, saturated Sichuan cuisine market.
– Jiumaojiu Group’s attempts to incubate new hit brands, like Song Hotpot and revived regional cuisines, have yet to yield a successor capable of replacing Tai Er’s former dominance.
– The transformation raises fundamental questions about operational scalability, brand identity, and whether the era of easily replicating blockbuster F&B concepts in China is over.
A Culinary Icon in Crisis
The scene was once familiar across Chinese shopping malls: long, snaking queues of eager diners waiting for a taste of Tai Er Sauerkraut Fish’s (太二酸菜鱼) signature spicy and sour broth. Today, that buzz has noticeably quieted. What was once a darling of China’s casual dining scene and a key growth driver for its parent, Jiumaojiu Group (九毛九集团), is now fighting for its survival. The brand is undertaking a frantic self-rescue mission, signaling a profound shift not just for one restaurant chain, but for the investment thesis surrounding China’s fast-moving consumer discretionary sector.
The core issue is stark. Customer traffic, measured by the critical industry metric of table turnover rate (翻台率), has collapsed from a stellar 4.9 times per day in the first half of 2019 to just 2.2 times in the first half of 2025—a decline of over 50%. While there was a slight uptick in the latest reporting period, the damage is clear. More tangible evidence comes from financials and store counts. According to Jiumaojiu Group’s interim report, revenue from the Tai Er brand fell 13.3% year-on-year to RMB 1.948 billion for the first six months of 2025.
The Scale of the Contraction
The revenue drop is directly tied to a rapid contraction in its store network. The number of Tai Er self-operated restaurants shrank from 612 as of June 30, 2024, to 547 by the end of H1 2025. This closure trend has continued, with the latest figures showing a total of 530 Tai Er outlets (509 self-operated) as of September 30, 2025. This means the brand closed a net 68 stores in just the first six months of the year, a startling reversal for a chain that was in aggressive expansion mode only a few years prior. For investors in Jiumaojiu Group, this poses a critical question: is this a temporary setback for Tai Er Sauerkraut Fish, or a fundamental de-rating of its flagship concept?
The Great Rebrand: From Standardized Fish to “Fresh” Sichuan
Faced with this existential threat, Tai Er is not sitting still. Its自救 (self-rescue) strategy is multi-pronged and radical, centering on a fundamental rebranding effort. Visitors to certain locations, particularly in Guangzhou and Foshan, are now encountering a transformed storefront: “New Tai Er·Fresh Ingredient Sichuan Cuisine” (新太二·鲜料川菜). Beyond the name change, the menu has been explosively expanded beyond its iconic single dish to include a wide array of stir-fried Sichuanese classics.
Even in stores retaining the Tai Er Sauerkraut Fish name, a new emphasis is palpable. Marketing now heavily promotes “live fish” (活鱼) and, as of December 18, 2025, the brand has officially launched a full-menu transparency system classifying ingredients by freshness. This aggressive push towards “fresh” and “non-pre-made” is a direct, if belated, response to a public relations crisis that severely dented its credibility.
The Pre-Made Dish Scandal That Sparked the Pivot
In September, Tai Er found itself at the center of a social media firestorm. A viral video and subsequent media reports highlighted that its signature酸菜鱼 (sauerkraut fish) could be served just six minutes after ordering. For Chinese consumers increasingly wary of预制菜 (pre-made dishes)—foods pre-processed in central kitchens and reheated on-site—this lightning speed was a major red flag, sparking widespread质疑 (skepticism) about the freshness and quality of Tai Er’s core product. Although the company issued swift clarifications, the association stuck. The current “fresh ingredient” campaign is a costly and operationally challenging attempt to scrub that stigma and rebuild trust. This episode underscores the heightened sensitivity among Chinese consumers post-pandemic and the immense reputational risk for F&B brands that fail to manage perceptions of quality and transparency.
Beyond Brand Issues: A Category in Decline
Tai Er’s struggles cannot be attributed solely to its own missteps. The brand is also battling powerful macroeconomic and industry headwinds. The very category that propelled it to fame—酸菜鱼 (sauerkraut fish)—is losing its sizzle. According to the “2024 China Sauerkraut Fish Category Development Report” released by the Hongcan Industry Research Institute (红餐产业研究院), the total number of sauerkraut fish specialty门店 (outlets) across China peaked in 2022 and has contracted for two consecutive years.
Data from Tianyancha (天眼查) paints a clear picture of the boom and bust cycle. The number of new餐饮企业 (catering enterprises) with “酸菜鱼” in their name skyrocketed from 785 in 2014 to a peak of 4,624 in 2018, before sharply falling to 2,355 in 2023. The market became oversaturated, homogenized, and vulnerable to shifting consumer tastes. As one industry analyst noted, “Single-dish concepts have a natural lifecycle. They can explode in popularity due to novelty and standardization, but they often struggle to maintain customer loyalty over the long term as the market crowds and diners seek new experiences.” Tai Er’s pivot, therefore, is not just a brand自救 (self-rescue) but a necessary escape from a sinking ship.
Swimming into a Redder Ocean: The Sichuan Cuisine Gambit
In turning to川菜 (Sichuan cuisine), Tai Er is attempting to leap from a cooling niche into one of China’s largest and most fiercely contested culinary arenas. However, this new pond is arguably even more crowded. Reports indicate there were over 151,000 Sichuan cuisine restaurants in China as of July 2025, accounting for 11.4% of all中式正餐 (Chinese casual dining) outlets. In Tier-1 cities like Beijing, Shanghai, Guangzhou, and Shenzhen, the market is intensely stratified and saturated, ranging from budget street eateries to high-end fusion bistros.
For Tai Er Sauerkraut Fish, this move presents monumental challenges. Its entire brand identity, operational model, and cost structure were built around the hyper-efficient standardization of one dish. The shift to a diverse “fresh stir-fry” Sichuan menu inherently increases kitchen complexity, may slow service speeds, and will likely raise costs for both labor and higher-quality ingredients. Can Tai Er maintain its operational efficiency and price point while delivering on this new promise of freshness and variety? This operational pivot is a high-wire act with no guaranteed safety net.
The Sam’s Club Paradox: Undermining the Dine-In Model
Compounding Tai Er’s identity crisis is a subtle but powerful channel conflict. The brand’s partnership with Sam’s Club, where customers can purchase ready-to-cook Tai Er酸菜鱼 (sauerkraut fish) kits, has created an awkward comparison. As noted by consumers online, the Sam’s Club version is often perceived as more affordable than dining in at a Tai Er restaurant. This has led to a dangerous perception: why queue and pay a premium at the restaurant when a comparable, and possibly more economical, experience is available at the warehouse store? This erosion of the core value proposition of the physical门店 (outlet) is a strategic dilemma facing many modern restaurant brands expanding into retail.
The Group-Wide Dilemma: Jiumaojiu’s Search for the Next Hit
The turmoil at Tai Er Sauerkraut Fish exposes a deeper,集团-wide (group-wide) anxiety for Jiumaojiu Group. The company’s growth story has been overwhelmingly reliant on this one blockbuster brand, which contributed 70.8% of group revenue in H1 2025. For years, management, led by Chairman Guan Yihong (管毅宏), has pursued a multi-brand孵化 (incubation) strategy, trying desperately to replicate the “Tai Er magic.” The results so far have been mixed, at best.
Its second major brand, Song Hotpot (怂火锅), saw its contribution to group revenue inch up to 15.1% in H1 2025, but its absolute revenue actually declined by 3.5% to RMB 416 million. The original九毛九西北菜 (Jiumaojiu Northwestern Cuisine) brand continues to fade, with revenue plunging 22.6% and its contribution shrinking to just 8.2% of the total. The group has launched experimental concepts in Shanxi cuisine and Chaozhou barbecue this year, but these are still in their infancy, far from being meaningful growth drivers.
Is the Era of Replicable Blockbusters Over?
The fundamental question for Jiumaojiu Group—and for investors in China’s consumer sector—is whether the market conditions that allowed a concept like Tai Er Sauerkraut Fish to explode exist today. The last decade saw a perfect storm: a booming consumer economy, the rise of shopping malls as social hubs, the viral power of social media, and a hunger for novel, standardized dining experiences. Today, the consumer landscape is more cautious, competitive, and discerning. As one fund manager specializing in Asian consumer equities commented, “The low-hanging fruit is gone. Creating the next nationwide dining phenomenon requires not just a good product, but flawless execution, authentic brand storytelling, and an operational agility that many legacy players find difficult to achieve. The playbook from 2018 doesn’t work in 2025.”
Strategic Crossroads for Investors and the Brand
The transformation of Tai Er Sauerkraut Fish is more than a menu change; it is a live case study in brand lifecycle management, operational pivoting, and corporate strategy under duress. For Jiumaojiu Group, the immediate priority is to stabilize its core asset. This involves successfully communicating its new “fresh” identity, managing the higher costs of the Sichuan cuisine model, and halting the store closure bleed. The performance of the rebranded “Fresh Ingredient Sichuan Cuisine” pilot stores will be a critical leading indicator.
For the market and institutional investors, the saga highlights several key themes: the heightened risks of over-reliance on single-concept, trendy dining brands; the intense pressure on Chinese consumer discretionary spending; and the severe challenges in executing a successful brand pivot in real time. The investment narrative for Jiumaojiu Group has shifted from one of aggressive growth via replication to one of urgent turnaround and diversification.
Monitor the upcoming quarterly reports closely for any stabilization in Tai Er’s same-store sales growth and table turnover rate. Observe the pace of new store openings versus closures for the rebranded format. Finally, scrutinize the margin profile—any significant compression would signal that the costly shift to fresh Sichuan cuisine is eroding profitability. The自救 (self-rescue) of Tai Er Sauerkraut Fish is underway, but its ultimate success remains a highly uncertain bet in China’s unforgiving culinary red ocean.