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Li Bao Ge Comes Aboard Freshippo

Update: December, 17/2019 - 10:01

To Explore New Retail Opportunities in Food Delivery Market Fully Integrated Online and Offline Operation

 

HONG KONG, CHINA - Media OutReach - 17 December 2019 - Li Bao Ge Group Limited ("Li Bao Ge" or the "Company"; stock code: 1869) announces its launch on Freshippo to tap into China's fast growing food delivery and takeaway market, based on the "New Retail" concept which integrates physical stores for in-store consumption with an online platform for fast and efficient ordering and delivery.

 

Li Bao Ge and Freshippo have entered into a cooperation agreement, under which Li Bao Ge will open in-store counters at Freshippo stores. With exclusive selling rights for Siu Mei products, Le Bao Ge will offer cooked-on-site Hong Kong-style roast meat ("Siu Mei") under the "Li Bao Ge" brand, as well as other specialties such as Cantonese-style soup, dim sum, dessert and festive delicacies. Freshippo will in turn make available its digital platforms and on-site facilities to Le Bao Ge and provide technical support, including its marketing initiatives, online sales resources, delivery service, potential customers, and establishment of online to offline ("O2O") channels.

 

Li Bao Ge undertakes to set up not less than 10 counters at Freshippo's stores on or before 15 December 2020. It will leverage Freshippo's brand awareness and high traffic to attract more young consumers and develop multi-channel sales to penetrate the Chinese takeaway and food delivery market. With the introduction of Le Bao Ge's Hong Kong style roast meat and other signature dishes, Freshippo will provide an exquisite shopping experience to customers. Since the size of the Company's new in-store counters are significantly smaller than its customary high-end Cantonese restaurants, the investment cost will be considerably lowered. This will enable the Company to transform into a less capital-intensive business model.


Mr. Chan Chun Kit, Chairman of Li Bao Ge Group, said, "We are pleased to have formed this partnership with Freshippo to jointly develop the fast-growing takeaway and food delivery market. Freshippo is the most notable player on the mainland embracing the "new retail" concept, bringing consumers innovative shopping experience unmatched elsewhere. As online consumption gains prevalence, the competition in the food and catering industry has extended from restaurants to online order and delivery. With that in mind, we have decided to adopt a new business model leveraging Freshippo's sophisticated digital management platform and big data analysis to develop a new integrated O2O operation based on an asset-light model. Going forward, Li Bao Ge will, starting from the South China region, expand into regions and cities with high purchasing power and appeal to a younger group of individual and family customers. We will gradually transform from a conventional banquet dining operator to a light meal delivery industry player. We will also explore the opportunities for the retailing of packaged food to accelerate the pace of expansion and enhance profitability."

 

At present, Li Bao Ge operates eight mid-to-high-end Cantonese restaurants in Hong Kong and Shenzhen. Its revenue is mainly derived from banqueting. The cooperation with Freshippo will substantially increase the number of Li Bao Ge's stores in China. The Company will benefit from more diversified revenue streams from new O2O sales.

 

Mr. Hou Yi, President of Freshippo, said, "Freshippo is committed to enriching the shopping experience on its platform and bringing a new and unique experience to consumers by introducing diversified retail brands or various restaurants as partners."

 

Freshippo is New Retail flagship under Alibaba Group. With fresh foods as the main attraction, its physical retail stores focus on enhancing customer experience, while delivery speed is the strong suit of its online business. It has built a comprehensive commercial channel comprising "fresh food supermarket + catering + App e-commerce + logistics" with a quick delivery cold chain distribution system that guarantees deliveries within 30 minutes in a radius of three kilometers around the store. As of 30 September 2019, there were 170 self-operated Freshippo stores in China.

About Li Bao Ge Group Limited (Stock code: 1869)

Li Bao Ge Group Limited is a Chinese restaurant group recognised for delivering Cantonese cuisine and Chinese banquet and dining services. The Group operated five full-service restaurants in Hong Kong and three full-service restaurants in Shenzhen in order to provide Cantonese cuisine under the brand name of "Star of Canton (利寶閣)". The Group also opened a Jingchuanhu cuisine restaurant in Hong Kong under a new brand name of "Beijing House (京香閣)" and established a Thai Restaurant, namely "La Maison D'Elephant (象屋)" in Shenzhen. All of the Group's restaurants are strategically situated in landmark shopping arcades or commercial complexes at prime locations. The Group maintains a business philosophy of offering quality food and services at reasonable prices under an elegant and comfortable dining environment. The Group wishes to diversify its restaurant business and customer base as well as to expand its market share in the PRC.

Li Bao Ge Group Limited

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