A Sudden Shutdown Shakes the Hotpot Scene
Known as the ‘Chongqing Hotpot Queue King’ and a social media sensation, Zhuguangyu Hotpot has unexpectedly closed all five of its locations in Changsha, leaving customers confused and demanding refunds for prepaid membership cards. The brand, which operates over 200 outlets across China, assured that it would process refunds for affected members while its headquarters took control of the suspended franchises.
Telephone lines to the Changsha stores have been disconnected, and mall staff confirmed that one location at Desiqin Urban Plaza had never actually opened—only promotional barriers were installed. The closures are limited to Hunan province (except Chenzhou) and do not affect other regions, according to the company.
Behind the Scenes: Franchise Management Challenges
Zhuguangyu Hotpot, founded in 2020, quickly became a viral sensation by blending traditional Chongqing hotpot with trendy drinks and desserts. Its signature dishes like Tiger Skin Chicken Claws and Hand-Smashed Lemon Tea were huge hits, with the latter reportedly selling over 700 cups per store daily.
The brand’s rapid expansion—from zero to 200+ stores in three years—was fueled by a savvy social media strategy. Founder Liang Xitong (梁熙桐) emphasized that Zhuguangyu operates on an internet-driven model rather than traditional restaurant logic. He credited the marketing team for understanding what young consumers want and creating buzzworthy products.
Franchisee Issues and Corporate Intervention
The Changsha closures were attributed to problems with local franchisees. The parent company stated that it had taken over the affected stores and would use franchisee deposits to refund prepaid customers. This incident highlights the risks of aggressive expansion through franchising, especially when local partners fail to meet operational standards.
The Bigger Picture: China’s Crowded Hotpot Market
Zhuguangyu’s troubles are not isolated. China’s hotpot industry is fiercely competitive, with high rates of failure among new entrants. According to a 2025 industry report, three types of operators are particularly vulnerable: high-end hotpot restaurants, low-quality budget chains in smaller cities, and inexperienced first-time restaurateurs.
Heavy investment requirements and low tolerance for error make hotpot ventures especially risky. The phrase ‘starting a hotpot business means starting a debt’ has become common among industry insiders.
Price Wars and Changing Consumer Tastes
As competition intensifies, many brands are lowering prices. A 2024 report on Chongqing hotpot showed that over 70% of outlets now fall within the 50–120 RMB price range. Meanwhile, regional varieties like Guizhou sour soup, Yunnan-style hotpot, and fresh beef hotpot are gaining popularity, squeezing traditional Sichuan and Chongqing brands.
What’s Next for Zhuguangyu and the Industry?
Despite the setback in Changsha, Zhuguangyu continues to expand internationally, with its first overseas store opening in Kuala Lumpur in May. The brand’s ability to innovate and create viral products may help it navigate current challenges.
Industry analysts suggest that future success may lie in exploring niche markets, emphasizing regional ingredients, and downsizing to community-focused formats. Some chains are also looking overseas for growth opportunities.
Key Takeaways for Investors and Consumers
The sudden closure of Zhuguangyu’s Changsha stores is a reminder of the volatility in China’s food and beverage sector. For consumers, it underscores the risks of prepaid membership cards. For investors, it highlights the importance of sustainable growth and strong franchise management.
As the market continues to evolve, brands that balance innovation with operational excellence will likely thrive. Those that rely too heavily on hype without solid foundations may struggle to survive.
– Popular hotpot chain Zhuguangyu closes all Changsha stores abruptly.
– Company promises refunds for prepaid members amid franchise issues.
– Hotpot industry faces intense competition and price pressures.
– Regional varieties and overseas expansion emerge as new strategies.
– Lessons for consumers and investors in China’s booming restaurant sector.
Stay informed about industry trends and consumer rights by following reliable business news sources and official brand updates.