Investing 700,000, zero in 3 months, county merchants' "bankruptcy three-piece suit", it ranks first!

With the halo of first-tier cities, well-known chain brands, combined with relatively low rent and labor in county towns, this should have been a profitable business. However, the so-called county town bonus has not only failed to materialize, but has instead turned into a wealth strangulation targeting the middle class in county towns, with a large number of franchise brands collectively falling into the quagmire of losses and closures.

The wave of store closures and negative cash flow has put county franchisees in trouble.

In this game of sinking franchise, catering, new tea drinks, and community retail have become the hardest-hit areas.

In the first half of last year alone, at least 17,100 physical stores in the country announced their closure, with nearly 10,000 closures in the catering industry, making it a disaster area; the franchise stores that collapsed in county towns accounted for an extremely large proportion.

Taking Guoquan Shihui as an example, its revenue relies on the procurement of franchise stores by as much as 82.2%. Opening a store in a county town requires franchisees to invest 200,000 to 300,000 yuan in real money upfront, but under the control of the headquarters, the store's gross profit margin is only between 30% and 35%, making it very difficult to profit.

In order to support its capital story of "20,000 stores in five years," the brand side will shorten the regional protection radius of franchise stores from 3 kilometers to 500 meters between 2024 and 2025, resulting in extreme store density within county towns, with franchisees crazily competing against each other for the already scarce customer flow.

At the beginning of 2025, Guoquan was forced to close more than 1,600 stores, and the trust crisis among county franchisees fully erupted; the same script also happened in the new tea drink track, where the once widely opened franchise HEYTEA also encountered a Waterloo in county towns. HEYTEA's cumulative store closures reached more than 400 by 2025, a large part of which were county franchisees who actively stopped losses after struggling.

Many county franchisees have exhausted their parents' retirement funds or their own wedding savings, only to end up with a mess. In addition to the expansion disputes of regular brands, county towns are also filled with a large number of scams from imitation fast-food brands, which have no core technology at all, with a closure rate exceeding 50%, completely turning county town franchises into an unfathomable "gold-consuming black hole."