Based on the latest information found, I will provide a comprehensive analysis of the relationship between XiBei’s 40 million children’s meal sales and its overall operational difficulties.
I. Impressive Performance of XiBei’s Children’s Meal Business
I.1 Sales Data and Growth Trajectory
Since XiBei entered the children’s meal segment in 2017, it has achieved remarkable market results. To date, its professional children’s meals have exceeded
40 million cumulative sales
, serving over
200 million family customer visits
[1][2]. In terms of growth trends, between 2019 and 2022, the revenue of XiBei’s children’s meal business achieved an
explosive growth of 415%
; over 20 million children’s meals were sold throughout 2024; during the summer vacation of 2025 alone, children’s meal sales exceeded 4 million, and the number of family customers with children dining in exceeded 2.3 million, a 25% increase compared to 2024[1][3].
I.2 Core Contribution of Family Customer Base
The children’s meal business has brought high-value core customers to XiBei. According to public data, family consumers now account for
over 60%
of XiBei’s total customer base, and family consumers make up more than 65% of its core customer group; during peak weekend hours, sales from family consumption account for as high as
78%
, and the overall associated consumption rate has also increased by
42%
[3][4]. This means that children’s meals are not just an independent business line, but also a key entry point driving the entire family consumption scenario.
I.3 Differentiated Competitive Advantages
XiBei has established a high professional barrier in the children’s meal sector. In 2022, XiBei first proposed the concept of “professional children’s meals” and established
7 professional service standards for children
, including serving children’s meals first within 15 minutes, children’s exclusive tableware meeting FDA safety standards, disposable baby bibs per customer, and fluorescent-free soft tissues for infants[5]. In 2025, it further upgraded its offerings, promising “five no-additions” (no monosodium glutamate, chicken essence, flavorings, artificial colorings, or preservatives), and publicly released its main ingredient list to accept social supervision[1][6].
II. Systematic Operational Difficulties Faced by XiBei
II.1 Fatal Impact of the Pre-cooked Food Controversy
However, XiBei is currently facing a more severe operational crisis. The “pre-cooked food controversy” with Luo Yonghao in September 2025 has become the largest external crisis since XiBei’s establishment[7]. Although XiBei’s central kitchen model is not categorized as pre-cooked food under national standards, consumers have a broader understanding of pre-cooked food. Coupled with XiBei’s focus on family scenarios and its differentiated product being children’s meals (a customer group highly sensitive to food safety), the trust crisis has continued to escalate[6].
Jia Guolong later admitted that from September 10 to 11 after the incident, the daily turnover of all stores dropped by 1 million yuan respectively, and it was estimated that the drop would be 2 to 3 million yuan on September 12[6]. More seriously,
in January 2026, XiBei’s store business dropped 50% year-on-year
, which directly confirms the far-reaching impact of this crisis[7].
II.2 Sharp Deterioration of Financial Data
XiBei’s financial situation has already raised red flags. In November 2024 (the month with the worst operational performance), XiBei’s overall revenue was only
265 million yuan
, less than half of the same period in previous years; the fixed expenditure on wages alone that month reached
135 million yuan
, and the high operating costs made it difficult for stores to cover expenses[7][8]. Jia Guolong disclosed that
the net profit margin per store is only 5%
, and no store has achieved real profitability[7].
In terms of annual revenue, public data shows that XiBei’s annual revenue from 2020 to 2023 was approximately 5.2 billion yuan, 5.5 billion yuan, 5 billion yuan, and 6.2 billion yuan respectively; it was about 5.8 billion yuan in 2024, and about 2.9 billion yuan in the first half of 2025[6]. Obviously, after reaching a peak in revenue in 2023, the growth rate of XiBei’s performance has slowed significantly in 2024 and 2025, and it is under enormous pressure.
II.3 Helpless Choice of Strategic Store Closures
On January 15, 2026, Jia Guolong officially confirmed that
102 stores
would be closed at once, accounting for about 30% of the total existing stores, affecting approximately 4,000 employees[7][8]. This is the largest store adjustment since XiBei’s establishment. Jia Guolong frankly stated that losses have
exceeded 500 million yuan
since the pre-cooked food controversy in September 2025, and “continue to fight to survive” has become the current core goal[7].
III. Can the Children’s Meal Business Reverse the Decline?
III.1 Positive Factors: Strategic Value of Children’s Meals
1. High stickiness of family customer base.
The family customer base brought by the children’s meal business has the characteristics of high frequency and strong stickiness. Parents have extremely high requirements for the safety and quality of children’s food, and once trust is established, the repurchase rate is relatively high. XiBei has established a differentiated barrier through professional services and has a first-mover advantage in this niche market.
2. Amplification effect of associated consumption.
The 78% weekend sales share and 42% increase in associated consumption rate indicate that children’s meals can effectively drive the entire family’s catering consumption, significantly increasing the value per customer.
3. Potential for brand trust repair.
After the pre-cooked food controversy, XiBei has enhanced transparency and trust through measures such as releasing ingredient lists, promising “five no-additions”, and opening kitchens for visits. As a core differentiated product, children’s meals may become an important carrier for brand trust repair.
III.2 Constraining Factors: A Single Business Cannot Reverse the Overall Situation
1. Limited revenue share.
Despite the rapid growth of the children’s meal business, its absolute revenue scale is limited. In 2023, XiBei’s overall revenue was 6.2 billion yuan, and the sales revenue of children’s meal takeaway was close to 200 million yuan. Even when including dine-in sales, the proportion of the children’s meal business in overall revenue is still small, making it difficult to support the overall performance independently.
2. Controversy over pricing strategy.
The price of XiBei’s children’s meal sets generally ranges from 46 to 53 yuan, almost twice the price of McDonald’s Happy Meal, and it has been labeled as “high-consumption” and “exclusive to the middle class”[4]. Against the background of the continuous decline in per capita catering consumption (national per capita catering consumption dropped to 39.8 yuan in 2024), the high-price strategy is facing market pressure.
3. Intensified industry competition.
The children’s meal segment has transformed from a blue ocean to a red sea. Haidilao has built customized children’s play spaces; family customers account for over 80% of the customer base in Jiu Mao Jiu’s children’s experience stores; Yonghe Tai’s sales surged 4 times after partnering with the Super Wings IP, and the entire industry is accelerating “involution”[4].
4. In-depth impact of systematic crisis.
The pre-cooked food controversy exposed not only product issues but also a trust crisis in consumers’ attitude towards the brand. Jia Guolong admitted that “I shouldn’t have confronted Luo Yonghao head-on, and I shouldn’t have opened the kitchen”, and the damage to the brand image caused by the arrogant response is difficult to repair in the short term[5][7].
IV. Conclusion and Outlook
Based on a comprehensive analysis,
although XiBei’s 40 million children’s meal sales is a commendable business achievement, it cannot reverse the current systematic decline of XiBei on its own
. This is mainly based on the following judgments:
First, the growth of the children’s meal business cannot make up for the loss of brand trust and decline in customer traffic caused by the pre-cooked food controversy. The data showing a 50% year-on-year drop in store business in January 2026 indicates that the negative impact of the crisis is still escalating.
Second, the strategic adjustment of closing 102 stores (about 30%) means that XiBei is “cutting off its arm to survive”, reducing operating costs and stabilizing cash flow by shrinking its business scope. This is a pragmatic choice in the face of survival pressure.
Finally, XiBei’s fundamental challenge lies in
the contradiction between its high average customer spending (92 yuan) and the current consumption downgrade trend in the catering market
. When the national per capita catering consumption is less than 40 yuan, its high-price strategy, which is benchmarked against Haidilao, is facing market tests.
Outlook:
For XiBei to reverse its decline, it needs to focus on the following areas: first, continue to deepen its presence in professional niche markets such as children’s meals and strengthen its differentiated advantages; second, re-examine its pricing strategy to find a better balance between quality and price; third, repair consumer trust and rebuild brand reputation; fourth, optimize the store network structure and improve the operational efficiency of individual stores. The children’s meal business can serve as the core moat for XiBei’s differentiated competition, but a comprehensive revival still requires systematic strategic adjustments.
References
[1] Finance Account - Anchoring the Family Gathering Position, XiBei Successfully Breaks Through the Red Sea of Catering (http://mp.cnfol.com/42086/article/1758420512-142023618)
[2] CNR Online - XiBei to Close 102 Stores, Jia Guolong Speaks Out to Deny Pre-cooked Food Claims Again (https://www.cnr.cn/mspd/yw/20260115/t20260115_527494415.shtml)
[3] The Paper - Who Can Take Over XiBei’s Children’s Meal Business? (https://m.thepaper.cn/newsDetail_forward_31813375)
[4] Gudong Steward - Losing 3 Million Yuan in One Day? Where Does XiBei Go From Here? (https://www.popcj.com/depth/7284202509480752)
[5] The Paper - XiBei’s Jia Guolong, “Wrong” Beyond Measure (https://m.thepaper.cn/newsDetail_forward_31609306)
[6] Tencent News - Losing 3 Million Yuan in One Day? Where Does XiBei Go From Here? (https://news.qq.com/rain/a/20250914A058D300)
[7] China Fund News - XiBei to Close 102 Stores, Jia Guolong’s Latest Statement (https://www.chnfund.com/article/ARf8bc0cb5-14a8-b4a3-21bd-3a1ed3cb9c42)
[8] Sina Finance - Jia Guolong Shouts “Come at Me”: Who Is Forcing XiBei to Close Stores? (https://finance.sina.com.cn/stock/zqgd/2026-01-16/doc-inhhnzat5435606.shtml)
