Huazhi Jiuxing presenta un nuevo modelo de selección preferente, buscando convertirse en el "Sam" de la industria del vino｜21 Observa la Feria de Primavera del Azúcar

21st Century Business Herald reporter Xiao Xia, Chengdu report

Seeing Sam’s and Pangdonglai’s own liquor brands selling well, China’s leading chain liquor sellers are also thinking: why don’t we do it? Why don’t we do it even better?

On March 23, on the eve of the Chengdu Spring Festival Fair, Huazhijiu Chain held a Huazhijiu Selection Supply Chain and Chain System Strategy Press Conference in Chengdu, announcing the launch of 4 new products under the “Huazhijiu Selection” in-house brand.

A reporter from 21st Century Business Herald learned on site that the four “Huazhijiu Selection” baijiu products are produced by Jiangsu Jinshiyuan, Henan Baofeng Liquor Industry, Moutai Town Hanwang Liquor Industry, and Sichuan Youyuanfang Liquor Industry, covering four major flavor types: strong-aroma, light-aroma, sauce-aroma, and mixed-aroma.

This is the first time Huazhijiu Chain has launched new products under the “Huazhijiu Selection” in-house brand after laying out “Huazhijiu Selection” as a new store format last year.

Huazhijiu Chain President Yang Wuyong introduced to the 21st Century Business Herald reporter that, from August of last year to now, “Huazhijiu Selection” has opened more than 200 stores nationwide, mainly in Hunan, Guangdong, Jiangsu, and other places; and the first batch of Huazhijiu Selection baijiu products launched this time will be sold in all types of stores nationwide of Huazhijiu Chain.

(Huazhijiu Selection president Yang Wuyong)

Huazhijiu Chain is the first liquor chain brand that successfully entered the A-share market. Its annual revenue once reached a scale of 10 billion. At present, its more than 2,000 chain stores are mainly divided into three categories: the Huazhijiu Chain iterative version 3.0 stores are group-buying stores, with the highest investment and the largest single-store scale, mainly featuring first-tier high-end famous liquors such as “Ma Wu” and others. Stores generally integrate with other formats such as catering and cultural and entertainment; they represent the brand’s high standing. Huazhijiu Famous Liquor Warehouse are retail stores, with the second-largest scale, actively expanding in tier-two and tier-three markets, covering a wider region.

And the Huazhijiu Selection launched last year aims, while aligning with the trend of retail stores, to meet consumers’ demand for premium liquor delivered instantly by increasing store density and strengthening supply-chain construction, which Yang Wuyong sees as a strategic format that carries Huazhijiu Chain’s new development direction in this next stage.

Huazhijiu launches its own brand “Price is only half for the same quality”

“Previously, Huazhijiu Chain was driven by product brands and production factors (such as channels, teams, resources). Now we have entered a new stage driven by innovation in the business model,” Yang Wuyong said.

When it made its debut in Chengdu this time, Yang Wuyong hoped to let the industry understand that: “Huazhijiu Selection” is not only a new store format; behind it is a whole system supported by “selected products + supply-chain construction.”

“We’re not developing a product for the store; we want to provide consumers with a professional standard system for choosing liquor, thereby enhancing the consumption experience,” Yang Wuyong emphasized.

To prove the quality and market acceptance of the four Huazhijiu Selection baijiu products mentioned above, Huazhijiu Chain invited 8 senior experts in the liquor industry, including Ma Yong and Gao Jingyan, to participate in the product selection and review, and nationwide recruited 10,000 consumers and store cooperation partners through Huazhijiu Chain stores to take part in blind tasting and evaluation. Ultimately, from more than 40 sample liquors, they selected the first batch of 4 products.

“Actually, we want to learn Sam’s logic—the liquor and drinks of Sam are a strictly selected-products model,” Yang Wuyong told the 21st Century Business Herald reporter. “We place even more emphasis on high cost performance, and help consumers filter products with the right prices and outstanding quality.”

The 21st Century Business Herald reporter learned that the four Huazhijiu Selection baijiu products will respectively cover the 100–300 yuan price segment. The suffixes 200, 400, and 600 after the names of some products indicate that the product quality can be benchmarked against products at that price level.

A person from Huazhijiu Chain said, “Our products can achieve the same quality, but the price is only about half.”

In the past one to two or three years, supermarkets such as Pangdonglai, Hema, Yonghui, and Ole’ are already cooperating with liquor enterprises to launch their own-branded baijiu, especially Pangdonglai’s collaboration with Baofeng Liquor Industry on the Free Love baijiu. It has already become a 1-billion-yuan-level single product, proving that high cost-performance baijiu still has a very large market.

In the view of industry observers, the own-brand baijiu products of well-known channels essentially replace small and miscellaneous brands from major producing regions and mainstream aroma types. Judging by industry scale, this segment still has a volume of two to three trillion yuan.

But compared with the above-mentioned supermarkets’ concentrated launch of low-priced baijiu under 100 yuan—even as low as 9.9 yuan—which has triggered buzz, Huazhijiu Chain emphasizes that its own-liquor product selection will focus on mid-to-high-end. It values the product’s sustained profitability rather than buzz effects.

The first batch of selected products is only the first step. In the future, Huazhijiu Selection will also work with more famous liquors to launch co-branded products, expand coverage of baijiu categories, and in addition, cover other liquor categories such as craft beer, wine, yellow wine, and non-alcoholic sparkling liquor.

“We expect Huazhijiu Selection’s liquor SKU to be within 100 units. We won’t do too many. We still need to ensure consistency in the mid-to-high-end positioning. Compared with the number of products, I’ll care more about the order quality and customer quality,” Yang Wuyong told the 21st Century Business Herald reporter.

This year will recruit 100 regional operators; delivery as fast as 15 minutes

Besides emphasizing the selection capability of its own-brand products, Huazhijiu Selection’s new model also places greater emphasis on supply-chain construction.

At this press conference, Huazhijiu Chain announced that it will further recruit “Huazhijiu Selection” regional operators nationwide. Together with Huazhijiu Chain, they will develop stores, build regional supply chains jointly, and guarantee delivery service by increasing store density and warehousing capacity.

The 21st Century Business Herald reporter learned that Huazhijiu Selection’s demand for regional operators mainly has three aspects:

First, they should have good reputation and influence locally, and work with Huazhijiu to develop and operate stores, to increase Huazhijiu Selection’s store density in the region. Second, they should be able to obtain supply sources of national famous liquors, local famous liquors, and local best-selling products. Huazhijiu may not necessarily require regional operators to have the corresponding brand agency rights, but operators must have supply sources that are reasonably priced yet authentic. Third, they need warehousing capability, so they can deliver to stores in a timely manner every day through the warehouse, thus ensuring the delivery timeliness of stores.

Yang Wuyong revealed to the 21st Century Business Herald reporter that currently, Huazhijiu Selection’s regional operators have already been recruited at more than 20. This year, it hopes to recruit 100. Each regional operator will cooperate with Huazhijiu Chain to develop 20 to 30 stores together, thereby expanding Huazhijiu Selection’s store scale and improving network density.

Existing operators from other industries are turning to this business.

A distributor from Inner Mongolia told the 21st Century Business Herald reporter that he previously was in the minerals industry. Starting last year, he began cooperating with Huazhijiu. From late last year to now, he has already opened more than a dozen Huazhijiu Selection stores in Ordos.

Compared with Sam’s “ready in an hour” and Meituan’s “half an hour,” Huazhijiu Selection hopes to satisfy young consumers’ instant purchase needs even faster. After store density reaches the required level, the fastest delivery from store to consumer can be within 15 minutes. However, Huazhijiu also added that the 15-minute delivery time can be achieved only after store density is improved to a sufficient level—the ideal time efficiency.

In Yang Wuyong’s view, this model of Huazhijiu Selection is well-suited for many small and medium distributors and tobacconist shops in terms of capital size, and the market space is very large. As he put it, with capital of several hundred thousand yuan, it can already get started.

“There are several million tobacconist shops in China. In the future, the industry will face K-shaped divergence. Some tobacconist shops will do well as they adapt to changes in consumption demand. Others that can’t keep up may face closure. It’s expected that 1/3 of tobacconist shops in the future will have to transform, and they all need to embrace new formats,” Yang Wuyong said.

For Huazhijiu Chain, which has been affected by market conditions, the new format and new model are also a key layout to move forward further after shedding burdens and stabilizing cash flow.

“This is actually a new model forced out by the current market conditions,” Yang Wuyong told the 21st Century Business Herald reporter. “If everyone only competes by squeezing prices, that’s a low-quality kind of competition. We still need to create incremental value with good products and services, in order to have a high-quality operating model—so that everyone can keep making money in a sustainable, long-term way.”