Pang Dong Lai pays staff double market wages and turns service into sales

Pang Dong Lai, a regional supermarket group in Henan, built a national reputation on the opposite of retail cost-cutting: pay far above market, generous leave and profit-sharing. Founder Yu Donglai says the 30-year policy is to exceed employee expectations on pay.

The numbers are documented: 2025 average take-home pay of 8,974 yuan a month versus a national private-sector retail average of about 5,588 yuan; 145 days of leave; a 5,000-yuan fine for overtime; and a 2025 profit-distribution plan giving about half of profits to staff — roughly 100,000 yuan per employee and 700,000 per manager or technical worker.

The investment returns as service: staff turnover fell from 2.01% in 2024 to 0.33% in 2025, stores deliver unusually attentive service, and sales reached 23.531 billion yuan in 2025, up 38.71% from 16.964 billion in 2024, with estimated net profit around 1.5 billion yuan.

Pay people like the asset they are

High pay and leave cut turnover, so experience stays in the store

Profit-sharing aligns employees with service quality

Low churn lowers recruiting and training costs over time

Word-of-mouth trust turns service into traffic and revenue

In service businesses, wage is not a cost line but a revenue driver: pay above market, then let retention and service compound into demand.

In 2026 a leaked internal talk, in which Yu said pay had exceeded fairness by 100% and should be pulled back, sparked nationwide debate; the company denied any pay cut and reaffirmed the policy. Yu retired from daily management, and Pang Dong Lai began preparing a Zhengzhou store while vowing never to list.