Huazhi Jiu Xing lança um novo modelo de seleção premium, querendo ser o "Sam's Club" da indústria de bebidas alcoólicas｜21 Observa a Feira de Primavera de Cantão

21st Century Business Herald reporter Xiao Xia, Chengdu report

At a time when Sam’s and胖东来’s own alcohol brands are selling like hotcakes, even China’s leading chain liquor stores are thinking: why don’t we do it? Why don’t we do it better?

On March 23, on the eve of the Chengdu Spring Sugar Fair, Huazhi Liquor Stores held a Huazhi Preferred Selection Supply Chain and Chain System Strategy Press Conference in Chengdu, announcing the launch of four new products from its “Huazhi Preferred Selection” private label.

A reporter from 21st Century Business Herald learned on site that the four “Huazhi Preferred Selection” baijiu products are produced by Jiangsu Jinshiyuan, Henan Baofeng Wine Industry, Maotai Town Hanwang Wine Industry, and Sichuan Youyuanfang Wine Industry, covering four major flavour profiles: strong-aroma, light-aroma, sauce-aroma, and mixed-aroma.

This is the first time Huazhi Liquor Stores has released new products under the “Huazhi Preferred Selection” private label since it laid out “Huazhi Preferred Selection” as a new store format last year.

Huazhi Liquor Stores’ president Yang Wuyong told a reporter from 21st Century Business Herald that from August of last year to now, “Huazhi Preferred Selection” has opened more than 200 stores nationwide. It is mainly in provinces such as Hunan, Guangdong, Jiangsu, and others. And the first batch of Huazhi Preferred Selection baijiu products launched this time will be sold across all types of stores nationwide.

(Huazhi Preferred Selection president Yang Wuyong)

Huazhi Liquor Stores is the first liquor chain brand to successfully list on the A-share market. Its annual revenue once reached a scale of over ten billion. Currently, its more than 2,000 chain stores are mainly divided into three categories: the iteration to version 3.0 of Huazhi Liquor Stores refers to group-buy stores—these have the highest investment, the largest per-store scale, and mainly feature first-tier high-end baijiu brands such as “Maowu” and similar. Stores generally combine with other formats such as catering and cultural entertainment, representing a high brand stature. Huazhi Famous Liquor Library refers to retail stores, which are smaller in scale and, while they come second, actively expand in second- and third-tier markets, offering broader regional coverage.

As for the Huazhi Preferred Selection launched last year, its aim is to align with the retail-store trend while meeting consumers’ demand for high-quality alcohol with on-demand delivery, by increasing store density and strengthening supply-chain development. Yang Wuyong regards it as a strategic store format that carries Huazhi Liquor Stores’ new-stage development direction.

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

“Previously, Huazhi Liquor Stores 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 model,” said Yang Wuyong.

When unveiled in Chengdu this time, Yang Wuyong hoped to help the industry understand that “Huazhi Preferred Selection” is not just a new store format; behind it is an entire system supported by “selected products + supply-chain development”.

“We are not trying to develop a product for stores; we want to provide consumers with a professional standard system for selecting alcohol, and improve the consumption experience,” Yang Wuyong stressed.

To demonstrate the quality and market acceptance of the four Huazhi Preferred Selection baijiu products above, Huazhi Liquor Stores invited eight seasoned experts from the baijiu industry, including Ma Yong and Gao Jingyan, to take part in the product selection and appraisal panel. In addition, in Huazhi stores nationwide, it recruited 10,000 consumers and store partners to participate in blind tasting and evaluation. Ultimately, from more than 40 sample wines, the company selected the first batch of four products.

“In fact, we want to learn the logic of Sam’s. Sam’s alcohol is a strict selected-product model.” Yang Wuyong told a reporter from 21st Century Business Herald, “We emphasise even more high value for money, and we help consumers filter products with a right price and outstanding quality.”

A reporter from 21st Century Business Herald learned that the four Huazhi Preferred Selection baijiu products will respectively cover the 100–300 yuan price band. The suffixes 200, 400, and 600 in the product names refer to products whose quality can be benchmarked against products at that price level.

A person from Huazhi Liquor Stores 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 Auchan have already collaborated with liquor companies to launch private-label baijiu, especially the Free Love baijiu co-developed by Pangdonglai and Baofeng Wine Industry, which has already become a 1-billion-yuan-level single product—showing that high value-for-money baijiu still has a very large market.

In the view of industry observers, private-label baijiu products from well-known channels fundamentally replace small and medium “miscellaneous brands” from major producing regions and mainstream flavour types. Judging by the scale of the industry, this still has a volume of two to three hundred billion yuan.

But compared with the buzz created by supermarkets’ concentrated launch of baijiu priced within 100 yuan—even as low as 9.9 yuan—Huazhi Liquor Stores emphasises that its private-label alcohol selection will focus on mid-to-high-end, and it values the continuous profitability of products more than the effect of “driving traffic”.

The first batch of selected products is only step one. In the future, Huazhi Preferred Selection will also collaborate with more famous liquor brands to launch co-branded products and expand coverage of baijiu categories. In addition, it will cover other alcohol categories such as craft beer, wine, yellow rice wine, and bubbly alcohol without alcohol.

“We expect Huazhi Preferred Selection’s alcohol SKUs will be within 100, and 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 will pay more attention to order quality and customer quality.” Yang Wuyong told a reporter from 21st Century Business Herald.

This year it will recruit 100 regional operators, with delivery as fast as 15 minutes

Besides emphasising product selection capabilities through its own private-label products, Huazhi Preferred Selection’s new model places even more focus on building the supply chain.

At this press conference, Huazhi Liquor Stores announced it will further recruit “Huazhi Preferred Selection” regional operators nationwide. Working together with Huazhi Liquor Stores, the operators will develop stores and co-build regional supply chains. By improving store density and warehousing capacity, they will ensure delivery services.

A reporter from 21st Century Business Herald learned that Huazhi Preferred Selection’s needs for regional operators mainly fall into three areas:

First, there should be a good reputation and influence locally. They should come together with Huazhi to develop and operate stores, improving Huazhi Preferred Selection’s store density in the region. Second, they should be able to obtain sources of national famous-liquor brands, local famous-liquor brands, and locally best-selling products. Huazhi does not necessarily require regional operators to hold the corresponding agency rights for the brands. However, operators must have supply sources that have the right price and guaranteed authenticity. Third, they should have warehousing capabilities, so that warehouses can deliver to stores in a timely manner every day, ensuring delivery timeliness.

Yang Wuyong told a reporter from 21st Century Business Herald that currently Huazhi Preferred Selection’s regional operators have already been recruited to more than 20. This year, it hopes to recruit 100. Each regional operator, working together with Huazhi Liquor Stores, will develop 20 to 30 stores, thereby expanding Huazhi Preferred Selection’s store scale and increasing network density.

Some clients from other types of businesses have turned to this line of work.

A distributor from Inner Mongolia told a reporter from 21st Century Business Herald that he used to be in the mining industry. Starting last year, he began cooperating with Huazhi. From the end of last year to now, he has opened more than a dozen Huazhi Preferred Selection stores in Ordos.

Compared with Sam’s “hours-ahead” delivery and Meituan’s “half-hour delivery”, Huazhi Preferred Selection hopes to satisfy young consumers’ instant alcohol-purchase needs even faster. After store density reaches the required level, it expects the fastest delivery from store to consumer to be within 15 minutes. However, Huazhi also added that 15 minutes is the most ideal time efficiency achievable only after store density has been raised to a sufficient level.

In Yang Wuyong’s view, this model of Huazhi Preferred Selection is well matched for many small and medium-sized distributors and tobacconists in terms of capital size, and the market space is very large. According to his statement, with a capital pool of several hundred thousand yuan, they can get started.

“In China there are several million tobacconists and alcohol shops. In the future, the industry will face a K-shaped split. Some will do well if they adapt to changes in consumption demand; others may face closure if they can’t keep up. We expect that 1/3 of tobacconists in the future will have to transform, and they all need to embrace new formats.” Yang Wuyong said.

As for Huazhi Liquor Stores, which is affected by market conditions, the new format and new model are also a key layout for further development after shedding burdens and stabilising cash flow.

“This is actually a new model forced out by current market conditions,” Yang Wuyong told a reporter from 21st Century Business Herald. “If everyone only competes by pushing price, that is a low-quality kind of competition. We still need to create incremental value with good products and services, so that we can have a high-quality operating model and everyone can keep earning money in the short and long term.”