Chabaidao’s first-half equipment revenue rises about 450% as Hong Kong franchise investors assess openings and supply trends

Chabaidao’s revenue growth reveals a divergence between equipment sales and regular supplies to stores. According to a report by The Paper on 15 October, the Hong Kong-listed tea drinks brand’s total revenue rose by 6.2% in the first half of 2026, but revenue from goods fell while equipment revenue increased sharply. For investors considering a franchise in Hong Kong, these figures are a reminder that growth at head office should not be taken as evidence of improved trading at franchised stores.

Equipment revenue becomes the main growth driver

The figures cited in the report show that Chabaidao’s first-half revenue from goods fell by 2.3% year on year to RMB 2.257 billion, while equipment revenue rose by approximately 450% to RMB 267 million. The increase in equipment revenue exceeded the roughly RMB 155 million rise in total revenue over the same period.

In other words, equipment sales were the main driver of revenue growth during this period, rather than a corresponding expansion in the supply of goods. Although both contribute to head office revenue, they reflect different types of transaction and should be assessed separately when reviewing results.

These figures alone do not demonstrate higher profits for franchisees, nor are they sufficient to establish whether individual stores have earned a corresponding return on their equipment investment.

Store openings and closures need to be considered together

The store figures also warrant a closer look. In 2025, Chabaidao opened 1,159 franchised stores in mainland China and closed 933, resulting in a net increase of 226 for the year, down from 587 in 2024.

In the first half of 2026, the brand opened 669 franchised stores and closed 499, giving a net increase of 170. Its store network continued to expand, but closures offset a substantial proportion of new openings.

New openings indicate expansion activity, while net additions show the change in network size after closures are taken into account. The two measures are not interchangeable, and these figures should not be treated as statistics for store openings and closures in Hong Kong.

Head office profits do not equate to franchisee returns

The report states that Chabaidao’s total revenue in 2025 was RMB 5.395 billion, up 10% year on year, while net profit rose by 71.2% to RMB 821 million. These are company-level results, not average franchisee profits.

Opening a new store involves purchasing equipment and initial supplies, while ongoing operations require subsequent purchases. When assessing a franchise opportunity, investors should examine one-off opening costs, recurring purchasing costs and the store’s own revenue separately, rather than deciding solely on the strength of head office revenue or profit growth.

Practical takeaway: Prospective franchisees considering Hong Kong can ask the brand to explain its equipment purchase and replacement requirements, ongoing purchasing arrangements, and store opening and closure figures separately. They should then prepare a budget based on rent, staffing and projected sales at their proposed location, rather than treating head office growth as a guarantee of their own returns.