MEALS And MANICURES

In the crowded space of hot-pot restaurants, Zhang Yong’s Haidilao succeeds through a tightly structured corporate culture—and unconventional customer service.

China has a lot of hot-pot restaurants. Zhang Yong’s chain thrives because of his unconventional customer service.

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“IT’S BETTER TO SCALE fast and be everywhere instead of having a single towering presence,” says Zhang Yong, the cofounder and chairman of Haidilao, one of China’s most popular restaurant chains.

Haidilao serves hot pots, basins of boiling broth in which diners cook their own meat and vegetables tableside. The experience is communal, like roasting marshmallows around a campfire, and it is ubiquitous in China, where hot-pot restaurants crowd the streets. What has made Haidilao a hit—with annual revenue now passing $1 billion—has more to do with its ambiance than its selections of sole, abalone or crispy, Sichuan-style fried pork.

Zhang, 48, is a high school dropout now worth $6.5 billion after Haidilao’s September IPO. He has made the company famous for its unusual amenities, like tableside manicures and a service that will print diners’ selfies. There’s also Haidilao’s carefully assembled structure, which funnels well-trained employees through its ever-growing empire—a complex web of shifus (managers) and apprentices who must pass rigid training. Haidilao promotes only from within, and shifus can earn a cut of their location’s profits. “Putting faith in my staff has paid off for me,” Zhang says. “Giving them responsibility and autonomy is how you show trust.”