HE YONGZHI opened her 126th Chongqing Little Swan Hot-Pot Restaurant in July after she started out with only three hot pots in a 16-square-meter eatery 20 years ago.

　Ms. He’s hot-pot establishment has been selected as one of China’s Top Ten Restaurant Chains, with total assets of 380 million yuan and a yearly revenue of 490 million yuan. Her brand Chongqing Little Swan has been awarded “A Famous Brand of China’s Catering Industry.”

　　While she was a designer with a children’s footwear factory in 1982 in the city of Chongqing, Ms. He bought a 16-square-meter space in a business area that she and her husband turned into a grocery store.

　Three months later, a government order stated that the street where their store was would be turned into a food street. Therefore, Ms. He’s store was remade into an eatery, which could serve three hot pots at once. The couple named the eatery Little Swan, not knowing it would be a high-flier in the future.

　Ms. He’s objective was to stop running the restaurant and live a peaceful life with her husband after she made 50,000 yuan.Three months later, however, Ms. He’s eatery was doing so poorly that the relatives who had worked with the couple went to look for jobs elsewhere.

　But Ms. He chose to persist. One day the couple found they had made a daily net profit of over 70 yuan, which was twice Ms. He’s monthly pay at the factory. So she quit her job at the factory and concentrated on the restaurant.Somebody said that it was Ms. He’s character that made her undertaking a success.

　She was generous in giving diners extra broth, spices and dishes. For the diners who could not stand the hot taste of the Chongqing food, Ms. He divided a hot pot into two sections: one with very spicy broth and the other containing no pepper at all. For those who complained about the price, Ms.

　He introduced China’s first ever hot-pot buffet. She put a funnel on a hot pot to keep the guests from being bothered by smoke. She also invented an aftertaste flavoring to put in the broth.

　Ms. He’s every invention helped draw more patrons to her restaurant, added to her fortune, and impacted the restaurant industry.Other hot pot operators copied Ms. He innovations. But they were unable to copy what they could not see: a hot-pot culture that closely related to Ms.

　He’s personality. She was warm, generous, clever and down-to-earth. The customers would take great delight in taking one or two shots of liquor with her.He’s eatery could no longer contain the swarms of diners.

　Therefore she moved it into a much bigger and beautifully decorated space. That was a revolution: for the first time, a traditional street-side hot-pot eatery turned into a grand restaurant, targeting big spenders.Standing in a barren suburban area of Chengdu, the capital city of Sichuan, one day in 1990, Ms. He was planning the first expansion of her hot-pot empire.

　Everybody around her told her that it was not a good location, since it was deserted and distant from the center of the city. But she said, “This is the place.”In her first hot-pot establishment outside Chongqing, she put in a stage for grand performances.

　The 2,000-square-meter restaurant was soon packed with the people who enjoyed both the food and the show.She later revealed her secret, saying, “The most important thing of business people is that they have cars that can take them wherever they want to go. Can you find a location in central Chengdu that has such a vast parking area?”By the end of 1993, Ms.

　He had opened 12 branches throughout Sichuan Province, with a revenue topping 50 million yuan. And by the end of 1998, 50 more branches in joint ventures had been in operation throughout the country.

　But it was also in 1998 that Ms. He stumbled on her first crisis in her restaurant industry. Poor management, embezzlement by the managers, grudging partners and a drastic plummet in profit weighed her down.The solution came from an international franchise consultation agency, which helped Ms.

　He reorganize the management system, standardize the service procedures and regulate the franchise agreements.Ms. He and her senior executives had a heated debate on hiring the agency, because they complained it was charging a large amount of money.

　Ms. He said, “The consultation fees are high. But without consultation we’ll lose a lot of money in operating costs. We’ve paid too much for the managers who aren’t qualified to do the job.”With a plan made with the aid from the agency, Ms. He started a new round of expansion. In July 2000, she founded a training school as a support system for her expansion scheme. Within two years, Ms. He signed out 126 franchised restaurants. Standardization became the centerpiece of Ms. He’s franchise operation.

　It applied to every aspect of a franchised restaurant such as taste, raw materials, decoration, marketing and sales.Before cooperating with Ms. He, a businessman from eastern China, with skepticism, visited almost all of the Little Swan restaurants in China. Then he met Ms. He and said he could wait no longer to buy a franchise. Within one year, this man became one of Ms.

　He’s regional agents for 15 franchises.She has since designed five profit centers: restaurants directly under the headquarters, the franchised outlets, hotels, real estate, and food processing and delivery. Her target was developing 300 restaurants within five years.

　A lesson that Ms. He had learned helped her cut into real estate sector. She had rented most of the space for her restaurants, but landlords always raised the rental price when they found the restaurants making big money. By chance, she learned that MacDonald’s only opened new outlets in locations that they had purchased.

　Therefore, Ms. He has since bought all the space for the restaurants run directly by her company. Ms. He also put stakes in a different industry: hotels. She opened the Little Swan Hotel in late 1996 and hired a professional manager.

　While the manager took time to set up a standardized operation, Ms. He’s husband, in his aspiration for quick financial returns, became impatient with the manager. Mr. He poked his nose into almost everything and soon brought the hotel into a difficult situation. And the manager was ready to quit.Ms. He mediated between the two and made the final decision: giving the manager full authority to run the hotel.The hotel proved to be a miracle, turning a profit in the first year of operation.

　What surprised Ms. He more was that the hotel’s annual profit amounted to that of all her hot-pot restaurants for 10 years.After that, Ms. He acquired a few more hotels. In 1998, she signed the contract for a Little Swan Hotel in Beijing. And she is planning for a four-star hotel in Chongqing this year.Ms. He is also developing a coffee shop chain in collaboration with a U.S. based company.

　According to her plan, the coffee shops will grow along the vein of her restaurant chain.

　Someone said that Ms. He has two wings: one of dream and the other of reality. Flapping those two wings, Ms. He’s Little Swan Group is flying high. And it will surely fly higher and farther.