Hotpot restaurant Haidilao. Photo: IC

 
Hotpot chain Haidilao International Holding said on Friday it will gradually close about 300 stores due to a lack of customers and poor performance. 

The company said the failure of these outlets to meet expectations was mainly caused by the company’s rapid expansion strategy in 2019.

As of June 30, 2020, Haidilao had 868 restaurants in the Chinese mainland. The company opened 308 new restaurants in 2019 and 544 in 2020. In the first half of 2021, 299 new stores were added. As of June 31, 2021, the total number of its global restaurants had reached 1,597. 

After closing about 300 restaurants, the total number is still close to 1,300, and the company is still China's largest hot pot chain. But its results have been disappointing recently, and in June this year, Haidilao had lost HK$260 billion ($33.4 billion) in market value in just four months. 

Zhang Yong, the founder of Haidilao, said at a meeting that the expansion plan had been too confident.

Haidilao’s share price has fallen by 75 percent so far this year, cutting its market value by HK$350 billion.