Media Focus
A Miracle of 600 Million Dumplings Produced in a Year by DND with the Help of Central Kitchens
---- Global Commercial Legends, April 4, 2006

In order to standardize the quality and taste of each dumpling, it took Da Ning Dumpling (DND) 10 years to draft a 380-page Code of Business Conduct. Now, DND sells out 600 million dumplings in a year, with a tolerance of less than 4% for each dumpling, and its restaurant in Australia has already kicked off.
In the morning, Meng Lijin, manager of DND Zhonglian Restaurant in Shanghai arrived at her office on time as usual. At 9:45, she starts to dress up and at 10 o’clock sharp, her daily routine work begins. As required by the Quality Control Brochure of the company, she first of all enters the kitchen to check the dumpling filling, flour, beef and other ingredients which have been sent here from the central kitchen dozens of kilometers away.
At the end of each working day, she will make an account of the consumables of next day and fax it to the central kitchen in Shanghai. Upon receipt of the order, and together with the orders from other 16 restaurants in Shanghai, the central kitchen will get things ready during the night and distribute them to each restaurant in the early morning.
Zhonglian Restaurant, a head restaurant of DND in Shanghai, is located in East Nanjing Road, a pedestrian mall and golden area in the city. It occupies a floor space of 920 square meters. This very restaurant, according to Wang Xiaowei, the manager of DND (Shanghai) Company, totals a sales volume of more than 10 million Yuan in 2005.
Started in 1996 as a small restaurant, DND has developed within 9 years into a dumpling restaurant chain with more than 200 outlets including two in Indonesia and Australia.
Every dumpling counts. To a dumpling company like DND which sells out about 600 million dumplings in a year, it is definitely no easy thing to make every dumpling taste the same.
Since the opening of DND Xinbei Restaurant inside Xinjiekou Department Store in the provincial capital city of Nanjing in 1998, its daily sales volume has exceed 10,000 yuan on the average. This restaurant is an indicator that DND has gone out of Changzhou to other cities in Jiangsu Province, which has greatly improved Wu Guoqiang’s confidence. In September of 1999, DND Zhonglian Restaurant was opened together with the renovated pedestrian mall in Nanjing Road, which indicated that DND started its operation in Shanghai. Within 6 years, DND has got 17 restaurants in Shanghai, located in golden areas like Nanjing Road, Huaihai Road and Xujiahui.
The central kitchens guarantee the provision of unified ingredients, while the 380-page code ensures that every dumpling tastes the same.
One interesting phenomenon is that in every city, DND teams up with KFC and McDonald’s, either next door or on the opposite side of the street. In the fierce competition with foreign fast-food restaurants, DND is by no means less competitive. On analysis of the successful experience of DND, Wu Guoqiang, Board Chairman and General Manager of DND said: “There are two key factors to success. Taste ranks the first. If the taste is not good enough, no customers will come no matter how attractive the appearance is. The next is the quality. From the first bowl of soup served in the morning until the last one at night, the good quality should remain the same. It takes us over 7 years to complete the quality brochure of our company and it is still being perfected.”
600 million dumplings are produced in a year by DND. Since every 6 dumplings weighs 120 grams, 12,000 tons of dumplings are produced – about 150 kilos of dumplings per day by each restaurant. If the whole process of producing the 150 kilos of dumplings were completed inside the restaurant, from the purchase of ingredients, the making of dough and filling to the wrapping of dumplings, together with the making of cold dishes and soup, the space of kitchen should have been bigger than that of the hall in every restaurant.
Obviously, it is not economic to have a big kitchen in a restaurant, and what is more, it will make the mass production of dumplings impossible. Finally, Wu Guoqiang found a way out. In any city with more than 3 chain restaurants, DND has set up a central kitchen which will be responsible for storage, purchasing of ingredients, initial processing, vegetable processing, meat processing, filling making and distribution. As for each restaurant, they only need to take the last step of the process, that is, the wrapping of dumplings. In this way, DND improves its efficiency, makes it possible to have more output with less input, and at the same time, still retains the characteristics of hand wrapping.
In November of last year, the new central kitchen of DND and the supporting center were completed and put into use. The central kitchen, 5 times as big as the head restaurant in Shanghai, covers an area of 4,800 square meters and is divided into chilling chamber, refrigerating chamber, initial processing chamber, vegetable storage chamber, vegetable processing chamber, meat processing chamber, filling mixing chamber, and filling making chamber. According to Wang Xiaowei, the newly-established central kitchen can provide distribution service for 50 to 60 restaurants at the same time. He anticipated an increase of ten more new DND restaurants in Shanghai this year.
It is hard to imagine how difficult it can be to make every dumpling the same size and taste. In every DND restaurant, there is a 380-page Code of Business Conduct which sets the particulars from the weight of wrapper and dumpling to the temperature of air conditioner in the hall of the restaurant.
In 1992, Wu Guoqiang started his own restaurant but failed to find the key to success. His restaurant in Changzhou National High-tech Development Zone was already heavily in debt when it had to be closed. “I was in a debt of 500,000 yuan. I knew that if I could not find a way to stand up at that time, I would never be able to.” Wu Guoqiang recalled.
Wu Guoqiang thought of dumpling, a food which customers might come for around the clock. He invited an old grandma from the northeast to wrap dumplings, while he himself prepared the filling. Thus, Wu Guoqiang’s business of dumpling took the first step. Unexpectedly, 1.5 kilos of dumplings wrapped on the first day were all sold out, and 2.5 kilos more, the second day. On the third day, due to the shortage of hands, the old grandma asked one of her friends to help her and still, the 4 kilos of dumplings wrapped that day were sold out. Wu Guoqiang’s business started to prosper and in less than half a month, his dumpling restaurant was quite well known in Changzhou and began to turn loss into gain. “Dumpling is loved by people in the north of China but not so popular in the south. Only if you have taken the right direction, can you enjoy a big potential in this field.” This was the very experience Wu Guoqiang got which gave him an opportunity to stand up.
A procedure was set to control the quality and cost, which ensured that the tolerance of dumpling wrapper and filling is less than 4%.
Before long, Wu Guoqiang set up his take-away restaurant of Da Niang Dumpling (DND) in Changzhou. Within one month, the volume of take-away increased sharply from 100 Yuan to 2000 Yuan per day. Along with the increase of the volume of take-away, DND grew to be known in Changzhou. On the new year’s day of the following year, the first DND restaurant started operation in Changzhou Commercial Plaza.
Learning from his own experiences, Wu Guoqiang realized that the operation of chain restaurants is the only way to sell his dumplings nationwide, while standardization is the key to success.
It is no easy thing to implement standardization, and even more difficult in Chinese restaurants. To a big extent, Chinese cuisine relies on the experiences of chefs who are to make timely adjustment for the duration and degree of heating and cooking. For example, what is the dividing line between “big, moderate and small flame”? How much is “little salt”? And what it means for “moderate amount of coriander”? All these questions have to be tackled while setting up standards for Chinese cuisine.
Anyway, on the basis of consistent experiments and accumulation of experience, Wu Guoqiang gradually set up a standardized procedure suitable for DND. On September 10, 1998, Suzhou Shilu Restaurant was opened, which was .the first DND restaurant outside Changzhou. “Given the fact that I couldn’t stay in Suzhou every day, I could no longer control the size of each dumpling with my own eyes. Therefore, I drafted a standard which required that the weight of 6 wrappers be 55 grams.” This standard allows a tolerance of less than 4% which is hard to find with the naked eye, but clearly shown on the scale.
It is easy to draft a standard, but hard to carry it out. Taking Zhonglian Restaurant as an example, one worker is supposed to wrap 20 to 30 trays of dumplings in a day. A random sampling is made on every tray of dumplings. If the worker fails to pass the sampling, he has to buy the tray of dumplings himself, which is no wonder a big pressure. Wang Xiaowei explained that all the workers have received strict pre-post training and the dumplings they wrap are basically in consistence with the requirement of the quality control system of the company. All these measure taken help to ensure a low error rate, actually less than one tray a day. In the quality control brochure, besides the requirement of 6 dumplings weighing 120 grams, standards have also been set on the ratio between water and flour for making dough, the size of wrapper, the amount of vermicelli and beef for a bowl of soup, etc.
The weight of dumplings can be weighed on the scale, but the amount of vermicelli and beef used for a bowl of soup is hard to control. “In the headquarters of our company, we have a team of more than 10 members to make collection of bills every day and count up the number of bowls of beef soup and bone soup sold out. Referring to the consumables acquired, we will know if everything is under control.” Wu Guoqiang said. “Besides standardized kitchens, the halls of our restaurants also enjoy a unified style. When we are designing the halls, we don’t like to simply copy those western fast-food restaurants. My demand on the designers is that DND should enjoy a unique appearance which combines Chinese and Western styles. For instance, newly-opened DND restaurants are all decorated with gray floor tiles.”
Standards should be implemented. Otherwise, they are in vain. Two-level supervisory system is established in DND to make sure that every restaurant is following the standards in their production and marketing. Every regional supervisor is responsible for 6 restaurants and there is a team of supervisors in DND whose duty is to make random examinations all over the country to ensure that every restaurant follows the regulations of the quality control brochure of DND in food safety, production, hygiene conditions, etc.
In seeking qualified individuals to become franchisees, DND is committed to dividing the profit in the proportion of 3 to 7, which has resulted in less capital pressure and steady expansion.
Wu Guoqiang has different views towards some chain restaurants which have adopted a rapid expansion mode. Making comments on the franchising mode of Xiaofeiyang, Wu Guqiang said, “It is not that simple. I feel that their mode of massive copies will encounter troubles.”
Being different from Xiaofeiyang, DND has chosen to become strong first, and then begin to expand. In seeking franchisees, DND has adopted a mode of steady development. “You make the investment, and I conduct the business. I work for you and we share the profit.” Actually, in this franchising mode, franchisees will play the role of investors and take care of moneybag, while DND will be responsible for the purchasing of ingredients, employment of staff members, management, etc.
Franchisees will cover rent and tax, while DND will pay for ingredients, water and electricity and employees’ wages. The two parties will divide the profit in the proportion of 3 to 7. Franchisees will share 30 % of the profit, with a term of 5 years.
To franchisees, though they can not possess all the profit, they can, with their primary investment, enjoy steady income. As to DND, this mode can help to reduce the expansion-related risks. DND now has attracted about 30 franchisees and 90 % of them have won success.
“Blind expansion will bring about disasters not only to franchisees and investors, but also to the development of the brand.” Chen Shi, General Manager of Beijing Keybox Consultation Company stated. “But, Chinese chain restaurants can not afford a standstill. Without development, franchising operation is only an empty talk. Therefore, it is a must to develop and develop rationally. The replication and control of the operation of Chinese chain restaurants remain questions to be solved by Chinese chain restaurants like DND.”
Starting from the first dumpling to a yearly production of 600 million dumplings, the success of Wu Guoqiang is attributed to his unremitting effort, which marks a breakthrough and a legendary story in the development of Chinese chain restaurants.