Inventory Clearance Over 50%, Why Does Yanghe Insist on "Waiting" for New Products? Who Can Understand This Move?

Product Launch | Zhongfang.com

Review | Li Xiaoyan

While the baijiu industry is still engaged in short-term scale battles, Yanghe Holdings has taken a decade-long disciplined approach to forge a high-quality development path of “clear inventory first, then expand the market.” Recently, the seventh generation of Hai Zhi Lan started nationwide distribution from Henan, marking the beginning of a new phase of large-scale shipments outside the province for this billion-bottle annual sales flagship product. From its listing in Jiangsu in May 2025 to its recent rollout across other provinces, the nearly 10-month pace may seem slow, but it reflects Yanghe’s deep calibration of channel ecology, market fundamentals, and industry cycles, demonstrating a unique “slow” logic and “solid” steps during a period of industry adjustment.

Channel health is the core confidence for baijiu companies to navigate cycles. Over the past two years, the industry has faced high inventory levels and price fluctuations, and Yanghe was no exception. However, unlike many companies rushing to boost volume and shift pressures, Yanghe launched a comprehensive channel reform early in 2025—controlling stock and clearing inventory to free up space for new products.

In February 2025, Yanghe first suspended sales orders for the sixth-generation Hai Zhi Lan within the province, then strictly enforced inventory control strategies in external markets, actively clearing old stock. This “drastic detox” adjustment temporarily pressured revenue figures but laid the foundation for restoring the channel ecosystem. To date, the core external markets have nearly completed clearing sixth-generation Hai Zhi Lan inventory, reducing stock levels from a high of 4-6 months to a healthy range of 2-2.5 months. Dealer inventory turnover days have dropped to 45 days, reaching industry-leading levels.

Changes in terminal feedback confirm the effectiveness of Yanghe’s strategy. A liquor merchant in Shangqiu, Henan, said, “There’s no more sixth-generation Hai Zhi Lan stock; we’re waiting for the seventh generation.” An agent in Xiangyang, Hubei, noted, “No more old products with scanning promotions; new products are on the way.” This “waiting for delivery” state is exactly what Yanghe aims for—shifting from passive payments and stockpiling to active anticipation of new arrivals, significantly boosting channel confidence.

More importantly, channel profit and price stability are simultaneously recovering. The seventh generation of Hai Zhi Lan’s wholesale price has stabilized, with channel margins higher than older products. Coupled with the new “volume control and stable pricing, win-win cooperation” channel model, manufacturer-dealer relationships are shifting from confrontation to mutual benefit. Yanghe is no longer pursuing short-term expansion but focusing on a healthy channel ecosystem, clearing obstacles for nationwide distribution, and laying a solid foundation for long-term growth.

The nationwide rollout of the seventh generation of Hai Zhi Lan is not just a product iteration but a key move for Yanghe to stabilize its fundamentals and expand into the national market. In the current deep industry adjustment and rational consumer return, the 100-yuan price segment shows strong resilience, becoming a stable growth point in the industry’s “dumbbell” structure. As Yanghe’s flagship product, Hai Zhi Lan, with annual sales surpassing 100 million bottles covering banquet, personal, and gift scenarios, serves as a core support to withstand industry fluctuations.

This nationwide expansion marks a shift from Yanghe’s previous extensive distribution approach to a consumer operation-centered marketing system, deploying strategies like “scan code red envelopes,” banquet policies, and terminal cultivation. This transformation from “channel-driven” to “bottle-opening sales” aligns precisely with current consumption trends—less drinking, better quality, and high cost-performance are now mainstream, with consumers valuing quality and authentic experience more.

Market data confirms the new model’s effectiveness. Within two months of the seventh generation’s launch, bottle-opening rates increased by nearly double digits, and terminal self-purchase rates rose significantly—over 10% in Jiangsu and nearly 8% outside the province. Three months after launch, sales exceeded 12 million bottles. In terms of quality, the seventh generation uses “3 years of main base liquor + 5 years of aged flavoring,” achieving a leap in quality. On JD.com, 48-hour sales exceeded 10,000 bottles, earning consumer recognition.

From a financial perspective, the nationwide rollout of the seventh generation of Hai Zhi Lan has brought multiple improvements. Stable wholesale prices have boosted channel margins, increasing dealer willingness to pay; the company has focused on promoting new products, reducing inefficient promotions of older products, and continuously optimizing sales expense structure, with a steady decline in sales expense ratio. As inventory turnover accelerates, operating cash flow has become more robust, supporting marginal improvements in company performance.

More broadly, the nationwide presence of this billion-bottle flagship will further diversify regional market risks. Previously, Yanghe’s reliance on certain regions was high, but after phased shipments to key provinces like Henan, Shandong, and Hubei, external revenue share will steadily increase, creating a balanced growth structure of “mass foundation and sub-high-end uplift.” Coupled with an increasingly refined channel ecology, Yanghe’s resilience against industry cycle fluctuations is significantly enhanced, laying the groundwork for reaching a 20 billion yuan sales target.

The baijiu industry is bidding farewell to the old era of scale expansion and entering a new cycle of value cultivation. With nine consecutive years of declining production, industry concentration rising, and the Matthew effect intensifying, consumption is shifting from business-oriented to mass banquets and home drinking. Channel logic is moving from inventory rebates to active sales. Against this backdrop, Yanghe’s “slowing down” is a respectful response to industry laws and a commitment to long-termism.

Although the pace of the seventh generation’s nationwide rollout may seem a step behind competitors, it actually aligns with industry adjustment rhythms. Yanghe has not blindly expanded but first addressed historical inventory issues, then steadily advanced its national layout; it has not relied solely on scale but focused on quality, channel optimization, and consumer operations to solidify its foundation. This “slow” approach reflects respect for the market, commitment to quality, and dedication to sustainable development.

Of course, Yanghe’s transformation still has a long way to go. The deep industry adjustment is ongoing, consumer segmentation continues, and competition in the 100-yuan segment is intensifying. The nationwide deployment of Hai Zhi Lan still requires persistent effort. However, based on current channel feedback, market sales, and financial improvements, Yanghe is on the right track—clearing inventory first, then launching new products to ease channel pressure; stabilizing fundamentals first, then expanding nationwide to strengthen growth.

From Jiangsu’s initial launch to phased distribution across other provinces, from channel inventory clearance to consumer operation, the seventh generation of Hai Zhi Lan’s nationwide journey exemplifies Yanghe’s transformation. In an industry shifting from “scale competition” to “quality competition,” Yanghe’s pragmatic steps and steady rhythm demonstrate what it means to “advance steadily and far.”

Deep waters flow silently; steady progress leads to long-term success. As the seventh generation of Hai Zhi Lan’s nationwide deployment unfolds, Yanghe will not only see marginal improvements in performance but also build a healthier channel ecosystem, a more solid market foundation, and a sustainable growth model. Amid the wave of industry adjustment, this “slow and solid” path will ultimately enable Yanghe to go further and more steadily on its journey of high-quality development.