Dialogue with Zhang Xuewu of Yanjin Shop Investing in snacks is very busy, and I see a new future fo

Mondo Gastronomy Updated on 2024-01-30

More and more snack stores with bright and clean windows have opened into the streets and alleys of the sinking market, and the accelerated expansion of business formats and frequent financing mergers and acquisitions have also allowed us to see a rare fire in the cold winter and darkness.

Snacks are very busy with Zhao Yiming, and shortly after the merger was announced, they won 10RMB 500 million investment.

In great contrast, a large number of casual snack brands that were originally comfortable have begun to retreat, and "not selling" has become the norm, and many leading brands have to quickly turn around and embrace the general trend of price reduction.

How to rethink the future of China's leisure snacks has become a must-answer question for enterprises to reshape value and improve efficiency under the new cycle.

On the one hand, on the channel side, the rapidly expanding snack wholesalers are often accused of homogenization and low-price competitionOn the other hand, on the brand side, several mainstream development paths for new and old players seem to have encountered obvious bottlenecks.

Everyone is trying to embrace change, but in the midst of such turmoil and chaos, even who is embracing it is starting to become confusing.

I thought about this question more thoroughly from the beginning. Manufacturing enterprises will have a future, and the market space for single products is limited, so the opportunities for multiple categories and brands are here from the beginning. I don't know if it can be done, but at least we have the foundation. ”

At the time when Yanjin Shop Holding Company invested in the snack group, we had an in-depth dialogue with Zhang Xuewu, chairman of Yanjin Shop. Founded in 2005 and listed on the A-share market in 2017, Yanjin Shop is a veteran snack company with a market value of over 10 billion.

Zhang Xuewu, chairman of Yanjin Shop.

In this contact, we found that this brand does not have a high sense of existence, and is even often criticized for lacking mental signature dishes, but it has the most "king" atmosphere.

Whether it is the long-term investment in the first chain and R&D, or the choice of multi-category and multi-brand development path from the beginning, Yanjin Shop has always been a minority in the snack industry where the asset-light model and explosive product marketing are prevalent.

The choice of this path has made the Yanjin shop not so dazzling"It's hard, but we're not in such a hurry. First build all the best chains, and then make brands one by one, which is a matter of course. ”

As Zhang Xuewu said, on October 21 this year, Yanjin Shop's Big Demon King Konjac Vegetarian Hairy Belly detonated consumer reputation as soon as it was launched. The persistence and compound interest in the basic skills make Yanjin Shop handy in building category brands, and "lack of mental signature dishes" will soon no longer be a problem.

Finish the difficult things first, focus on consumer value, and let growth come naturally, this high-quality development thinking is also reflected in the investment in the snack very busy group.

As we mentioned earlier, many people's discussion of snack wholesalers today is still at the level of homogenization, low-price competition, and staking land, and even when the entire business has exceeded 10,000 stores, there are still people discussing whether snack wholesalers can exist for a long time.

In fact, there is nothing wrong with it, the expansion and merger scene realized by today's snack wholesalers is really not unfamiliar to many players.

There have been many discussions about the rationality and space of the model itself, and we will not repeat it, but this investment by Yanjin Shop Holdings and Haoxiang You are very busy with snacks group can indeed be regarded as a turning point.

Different from the pure financial investment in the past, these two are industrial parties with deep industrial accumulation, and they are precisely the key forces leading snack wholesalers out of low-dimensional homogenization and competition.

The great development prospects are inseparable from the help and support of the industry. Without the collaboration of the back-end ** chain, everything is just an illusion. "In the past, Japan's 711, Lawson, and FamilyMart could not be exported to the world without the support of the first chain, and today's China's snack wholesale industry should develop healthily.

In Zhang Xuewu's view, instead of fighting each other's attrition, it is better to assist everyone to complete the union.

The long-term thinking of Yanjin Shop from competition to win-win, as well as decades of planning and layout, is also the strategic determination that brands need to precipitate the most.

Conversation |Zhang Xuewu.

Edit |Xie Linqi.

Inspur New Consumption: As a veteran player who has been deeply involved in the past 20 years, you have experienced waves of changes in the snack industry

Zhang Xuewu. The future of the snack mass sales model is still worth looking forward to, because it at least caters to the trend of economic downturn, weakening consumption power, and improving efficiency.

Judging from the current players, Snacks is very busy and Zhao Yiming has merged, Wanchen Group has acquired his wife, and the other major ones are Sugar Nest, Snack Youming, etc., and then there are retail brands scattered in various regionsThis is a particularly interesting thing, a track that may have 100,000 stores and a scale of 3000-500 billion in the future, in fact, few players are playing.

And compared with the previous grand occasion of the community throwing a lot of money, in fact, capital has not played much of a driving role in the development of the snack wholesale industry. From the perspective of the amount of financing, snacks are very busy, nothing more than about 1 billion, which is less than 1 10 of the financing volume of some projects in the past.

But I think that's a good thing.

In the process of continuous iterative evolution, snack wholesalers will inevitably face various challenges, and using capital to drive will cause problems. Because China's retail business has passed the period of capital as the core driving force, I believe that the current time should be driven by the mission of industry and entrepreneurs.

Wave of New Consumption: How to Understand the Change of This Core Driver?

Zhang Xuewu. The development of an era still depends on the entrepreneurs who enter the game.

The early entrepreneurs grew up at the right time, and they did not experience real iterations in the development process, nor did they plan ahead for the uncertainty of the future, but these deficiencies were still filled in by this generation of young entrepreneurs.

And we had a lot of opportunities at that time, and if we grasped it, we could change some of our fate, and now there are few opportunities, but once we have them, it will be extremely huge.

So one thing I know for sure is,Snack wholesalers will rewrite the pattern of China's snack channel and become a pivotal channel, with an estimated market share of 25-30%.

Of course, the great development prospects are also inseparable from a good environment, including the help and support of the industry.

Without the collaboration of the back-end ** chain, everything is just an illusion. For example, it is precisely because of the support of the ** chain that Japan's 711, Lawson and the whole family finally formed a three-strong pattern and exported to all parts of the world.

I often output a logic with the team, when we were doing store channels, we didn't have the ability to change the pattern, because they had too much right to speak, and we could only follow the trend. So in this new wave, we must seize the opportunity to drive the healthy development of the entire snack wholesale industry together with new players in these industries.

We want to help you unite instead of fighting each other. Under the good industry trend, in the future, if you do 50 billion, he will do 80 billion, and I will do 60 billion, everyone can be a very good enterprise, why should you spend money on fighting wars for no reason?

That's what I wanted, and we have a responsibility and an obligation to do it.

Yanjin shop Liuyang production base.

Inspur New Consumption: What is the story of Yanjin Shop Holdings' busy investment in snacks, and how did the two sides come together?

Zhang Xuewu. In 2021, I have a new perspective on what the future holds. In the economic downturn, the mass sales channel is still efficiency-driven, and the link with manufacturers is shorter than that of supermarkets. So,I think this snack monopoly channel model has a very broad space in the future.

So, I asked Mr. Yan, who was very busy with snacks, to come out and talk about it. At that time, I directly said to him: Don't you want to find a listed manufacturing company to take the lead in embracing you, then from now on we will go all out, you tell me how to cooperate, we will cooperate immediately.

In fact, the chairman of the two of us made a statement, and the cooperation began.

But it was really painful, and the pressure of the whole channel and business came to me at that time. Even for this matter, there was a boss who forced me to give up my cooperation with the snack wholesale channel, otherwise I would resign, and I asked him to leave at that time.

Inspur New Consumption: In the process of cooperation, what did you see that made you sure that this company could be a long-term partner of Yanjin Shop, and finally decided to invest in him?

Zhang Xuewu. I really appreciate Mr. Yan and his team, on the one hand, they are very insightful in their judgment of the future of business, and on the other hand, they have a positive sense of mission and values.

Mr. Yan often said that it is not easy for franchisees, they all use their family savings to open stores, once this model can not really make consumers profitable, so that franchisees can maintain a survival rate of more than 98%, then his responsibility is not in place.

We, too, will not rely on this investment to make him buy more of our products or make changes** - only by treating Yanjin Shop and other enterprises equally can we be forced to grow and progress.

Of course, there are other dimensions to consider.

First of all, if you want the industry to have a future, you need a win-win situation. We don't invest in him to make any money from him, but to make the industry and the retail side have closer strategic cooperation, which is very important.

Only by opening up this part can we form synergies in the future strategy, play a greater role, and truly serve consumers well.

Secondly, not only snacks are busy, but if there is a channel with more advanced productivity that can represent the future, we will also consider continuing strategic cooperationBecause it's not something that can be done by a single company.

Inspur New Consumption: After investing, what are your expectations for the future?

Zhang Xuewu. There are two points that we are looking forward to and optimistic about.

First, the snack wholesale format is a unique supporting facility for future community commerce in China. Community commerce in China is so developed that each community can carry this type of business.

Its channel sinking ability is also particularly powerful, today the snack is very busy has been opened to every township in Hunan Province, and in the future in every township in every province can be opened.

So we think it's going to be very permeable.

In the process of cooperation, our products can also penetrate into all communities and sinking channels.

Second, channels are naturally closer to consumers. Through close cooperation, we can co-create and think about how to better serve consumers and develop better products.

This part has actually been proven in past collaborations, and they have a lot of data feedback that can help us complete some perspectives.

Inspur New Consumption: In the past few years, we have seen that the industry has undergone great changes, and many brands have also encountered bottlenecks. What has been your biggest takeaway and transformation in the process?

Zhang Xuewu. Over the past 45 years of reform and opening up, beverages and instant noodles have been the first wave of development, including the cooperation between Danone and Wahaha to build factories, the establishment of Master Kong, and so on.

The second wave was sweet foods such as biscuits, chocolate, baking, and potato chips.

The third wave is Chinese-style snacks, including lo-mei, meat products, nuts, dried fruits, and so on.

The market size of Chinese snacks is 4000-500 billion, but there are thirty or forty categories, which are very scattered, and some of the specific players are also very interesting.

Some non-manufacturing enterprises may face greater difficulties. There are also some players who choose too narrow categories, the market space is limited, and it is difficult to achieve tens of billions of dollars with a single category.

I thought about this question more thoroughly from the beginning.

How big will it be after the Yanjin shop is listed?If you want to be a 30-5 billion company, 2-3 categories are enoughBut if you want to make a company like Mondelēz and Procter & Gamble, you may need more categories, but not too many, because it is easy to control and cannot form a truly top two category brand.

Therefore, we focus on 7 categories, and this year we are expected to be able to achieve 5 billion tax included, with an average of 700 million for one category. If you want to be one of the best in these categories, each is estimated to be 2 billion to layout.

Therefore, based on the understanding of the development of the food industry in Europe, America, Japan and South Korea, and the judgment of the future economic situation and industry, we believe that the underlying logic has the following points:

First, the future competition of snacks will be the same as instant noodles and water, so it is necessary to build the best chain capabilities, intelligent manufacturing capabilities and total cost leadership capabilities.

Second, don't choose a category track with limitations. We have selected very representative categories of Chinese snacks, and we expect to be among the best in the category through 2-3 three-year strategies.

Third, our future approach is that the company's internal growth, system improvement and extended category brand cooperation and development go hand in hand.

Inspur New Consumption: Why do you think that the layout should be more comprehensive at the beginning, and the difficulty of making up for the shortcomings of the ** chain or expanding the category in the later stage is underestimated?

Zhang Xuewu. **Chain capacity, intelligent manufacturing ability and product power can not be made up overnight, in the end hundreds of millions of investment, how much output, is the equipment thrown to you will become a waste - if there is no accumulation in the early stage, when it is the turn to really do it, it may be more than enough and not enough.

Our greatest confidence in this regard is the precipitation of our understanding and ability to build in the manufacturing industry. After all, there are still a few geniuses, jumping three or four levels in a row, and only studying in high school for one year, what is this possible?

If you start with a single category and then go to other categories, it is false to say that you can't do it, but if you keep this idea for so many years, the culture and genes of the enterprise will determine whether you can achieve the coordinated development of multiple categories.

Therefore, it is really difficult for Yanjin Shop to choose a multi-category and multi-brand path at the beginning, but we can't give up halfway. Because the strategy is also gradually polished, the further you go, the clearer the road becomes.

Inspur New Consumption: So what can we learn from the international food giants?Is it something that looks very tall and sophisticated?

Zhang Xuewu. There are two directions that are worth learning from.

First, a complete system of category brands.

From brand building, category research to intelligent manufacturing, and then to omni-channel development, he uses modular comprehensive capabilities to create a category that is worthy of our learning and reference.

Second, learn from his development path of endogenous growth and extension cooperation and mergers and acquisitions to extend the category.

At present, China's snack food companies are either just doing an appearance (looking for OEM), or they are overly superstitious category brands, but in the specific domestic environment, they must take a two-pronged approach, not only to do the depth of category brands, but also to do the width of multiple categories, and at the same time improve the comprehensive strength of enterprises, in order to move forward steadily.

This is also a very important concept and perspective in our internal strategy advocacy process.

For example, in the category of potato chips, the technology behind it is not difficult to breed.

In the early days, many people said that potato chips were difficult to make, but later I learned that some foreign companies were very smart and thought deeply. They tell you that the seeds, the equipment, and the preservation techniques of the potatoes are all from Italy or something, but you don't understand it anyway.

There are also people who don't believe in evil, such as Dali Garden, so they ended up with Kobik.

In fact, in the current food industry, it is not difficult to make other people's things into seventy or eighty percent, but do you say that they have high-end technology, such as patent research and flour analysis?I think there is, but it's unrealistic to say that these have a huge impact on ** and consumer choice.

R&D is very important, but it is enough to be one step ahead, and it should not disrupt the pace of development.

R&D is more about returning to the original intention and concept:

First, it is safe, delicious and healthy, and achieves high-quality and low-cost performance.

Seven or eight years ago, I ate at one of the best restaurants in Changsha, and it was really delicious, but I felt uncomfortable after eating because I added too much seasoningLater, you will find that catering is also paying more and more attention to real materials, paying attention to restoring the original taste of ingredients;

For example, Sam's requirements are no preservatives, no coloring, no fragrance, and now these can be achieved.

Second, we should focus on safety, including the continuity of the process end, reducing the contact between personnel and food, and digitally managing product quality.

Third, move towards the differentiation of consumer insights.

Inspur New Consumption: You are more concerned about the overall situation, which leads to some times it will seem slower. But when many players in the market are rapidly increasing their volume, what is your long-term focus?

Zhang Xuewu. We used to be often criticized, saying why don't we learn from other brands to advertise, and other people's sales in one day can be worth you for a year

Among the people who said this to me was a girl who graduated from Harvard Business School, and I asked her at the time, "What do you think of Wahaha?"She said that I haven't drunk much now, which is definitely not good, but in fact, Wahaha still has sales of 500-60 billion.

So what is strategic determination?Actually, it's not that complicated, your cognition is here, and if you go in the opposite direction of it, you want to die.

If I had been misled into learning someone else's pattern, I would have died sooner than that.

Inspur New Consumption: There are also many people who say that Yanjin Shop lacks mental signature dishes. What exactly has your long-term investment in R&D brought to the brand?

Zhang Xuewu. In fact, he was not wrong, but our logic at the time was that we should first make safe, delicious, healthy, and fresh products to occupy an advantage in total cost, and then start the brand road of 7 categories at the same time, including creating the Great Demon King and the Egg King.

It is true that many people have been obsessed with the so-called explosive products in recent years, but I always think that some things are more important.

For example, let's say there are two options:

The first is a cup that costs 5 yuan, costs 2 yuan for advertising, and is finally sold to consumers for 10 yuanThe second is a cup that costs 2 yuan, and the advertising costs 2 cents, and is finally sold to consumers for 3 yuan.

Which path will you choose?I would of course choose the second option. We are not in such a hurry, wait for me to build all the ** chains, and then one brand at a time, but I am not a fool, I will smash 30% of the advertising directly, maybe two or three cents is still okay.

Inspur New Consumption: This unhurried gene, has it been thought and done since the first day of entrepreneurship, or has it been tamed by reality in the middle?

Zhang Xuewu. My dad went to the sea to start his own candied fruit factory, and struggled for 7 years to make a revenue of more than 1 million, why can't I wait?Comparatively, we're already fast. You see, some companies are like high jump, jumping to 1 billion at once, but then they can't go up again.

Slow is fast, and we pay more attention to the rhythm of comprehensive ability development.

It is precisely because of the slowness that when we created the Great Demon King this year, we were almost 100% confident that the comprehensive strength of a series of modules such as brand understanding, omni-channel construction, and R&D was there, and creating a mental signature dish has become a matter of course.

As soon as we came out, the big devil's signature sesame sauce flavor vegetarian hairy belly directly detonated the industry. Therefore, there is still a process, so that the foundation will be more solid.

Wave of new consumption: have you ever wavered or tangled in the middle?

Zhang Xuewu. Never.

It is actually very difficult for China to produce a great manufacturing enterprise for leisure snacks. To this day, in the Chinese snack industry, there is no manufacturing enterprise with more than 10 billion.

There are two enterprise groups with different genes in the Chinese snack track: one is small and medium-sized enterprises, which have been done for a lifetime, and the good ones may be two or three hundred million, and the bad ones are tens of millions;The second type is the head enterprise of a single category brand.

Therefore, for Yanjin Shop, the opportunity for multiple categories and brands is here.

Of course, I have such ambitions, and it is still unknown whether I can actually do it, but at least we have the foundation.

I think very clearly about this path, no matter what difficulties and dangers, I will try to move forward. I may not be able to do it in five or ten years, but I must do it in a longer time dimension.

Inspur New Consumption: Yanjin Shop actually began to lay out sub-brands very early, but only this year began to shout the slogan of multi-brand development. What new understandings and plans do you have for this this year?What are the noticeable differences in approach?

Zhang Xuewu. The strategy is clearer. We believe that these categories will be able to reach a share of more than 20 billion in the future, and at least a few outstanding category brands will come out.

In fact, our big demon konjac adopts a following strategy plus differentiation. At that time, when we proposed to make konjac, the logic was that the konjac silk of our friends was doing well, so can we make a vegetarian hairy belly?

Friends have always wanted to do a good job of konjac silk and did not pay attention to this category, so after we participated, the category brand of konjac hairy belly and big devil quickly grew.

When the first brand of konjac woolly belly came out, it was logical to drive the sales of konjac silk. Even the market share of the konjac hairy tripe category we created is now larger than that of konjac silk.

At this time, even if others realize this and immediately make a layout, we already have a first-mover advantage. Because we have spent 3 years on the research and development of konjac hairy tripe, the intelligent manufacturing of the first chain has had several years of precipitation.

In addition, I think there are opportunities in the category of quail eggs:

First of all, as a small category, quail eggs have pain points because of the risks of raw materials.

Everyone used to sell quail eggs and eat quail eggs from the beginning of fresh clear water eggs, the market is not large, there are no bigwigs and industry capital to pay attention to how to make quail eggs like eggs more than ten years ago to achieve standardized breeding and production. If we want to take this road, we must build the source of front-end research and development and digital breeding with heavy assets.

Seasoning is just a process, the biggest value of quail eggs is still in the egg itself, if I have the foundation of the first chain, and the ability to build a brand, the first brand of this category will come out.

Moreover, after the quail egg plate is made, eggs can also develop together, so I think Egg King will be one of the leading brands in the future.

There are also surimi products, our fish tofu also has 4-500 million, this track is mostly a single category of companies, the organizational system, synergy is not so strong, so in the future, our cod snack brand pure cod can also be made.

Our company is committed to building several core brands, and others participate in the form of mergers and acquisitions and collaborative development, such as meat products and baking, and we have the potential to link the industry's top brands.

Endogenous and epitaxial go hand in hand, and the core is to master the rhythm.

Inspur New Consumption: How do you identify which ones are endogenous and which ones are extensive?

Zhang Xuewu. There are great opportunities in itself, and we are also very capable of being one of the best, so we choose endogenous development;If we can't do it, we will strive to be one of the best with the help of epitaxial collaboration.

Konjac must be endogenous, because our technology is very strong, and egg products must also be endogenous.

As for potato chips, I don't think it can be done very much, after all, the brand power of foreign-funded enterprises is too strong. Of course, they also have a problem, there is actually a gap in the raw material end and the first system, but we still adopt a follow-up strategy for this category.

The plate of bread and cake is very large, but no one has rushed out yet, the first place is less than 2 billion, and the second and third places are only hundreds of millions. We can divide the categories, find the brands that are doing better but have weak development, and carry out epitaxial collaboration.

Meat products should also seek extension, because we have this gene, but we haven't started to do it yet, people have been doing it for more than ten years, so it is better to cooperate with a brand for layout.

We will also develop surimi and minced meat products endogenously, on the one hand, we have our own professional strengths in this area, and on the other hand, the category itself has great opportunities.

Inspur New Consumption: In the process of focusing on these 7 categories, what pains you the most?

Zhang Xuewu. As long as you are in the right direction, you will firmly follow this path, and the pain may be others.

Some people will be framed by growth and growth, and they will suffer once they are stuck by bottlenecks, but in fact, they will have to go through the process of slow development.

We focus on 7 categories, which is actually better than a single category company. After all, there are ups and downs in the category, this year is better, next year is worse, and companies in a single category may have some years that are very uncomfortable in the process of experiencing the impact of cycles and raw materials.

For us, the east is not bright and the west is bright, and this category is more difficult this year, but several other categories may be better, and on the whole, they are more anti-cyclical.

This set of concepts can also be migrated to the channel dimension, where brands that bet on a single channel will be more painful, and those who deploy omni-channel will be more resilient to risks.

Inspur New Consumption: What new insights have you gained in the practice of the Great Demon King?

Zhang Xuewu. The Great Demon King is the first category brand we have created, and judging from the current results, it has slightly exceeded previous expectations. Whether it is in the development of omni-channel or product innovation, we have made bright spots.

In fact, the product creation of the Great Demon King is mainly divided into two parts: one is the embryo body, and the other is flavor adjustment. Spicy and spicy flavors may be prevalent in the market, and we found an innovative flavor of sesame sauce through research. At the same time, from hot pot dishes to casual snacks, we have explored a better embryonic body and taste.

What I learned from this is that to think from the user's point of view, the user's accurate judgment is more important than the company's authority or experience——The brand of the Great Demon King, including the name, taste, and packaging design, are all co-created with users.

Thousands of consumers provide continuous feedback, which we then use as a basis to make adjustments.

After the brand landed this year, we are also building this feedback and iteration system, and e-commerce channels and snack wholesalers are very close to consumers.

And we found that it is actually handy to build a category brand on the basis of the past. Sticking to this road, in fact, many things will become compound interest, which also strengthens the direction of "gradually building a category brand" that we formulated at the beginning of the year, so we are actually more and more confident.

Inspur New Consumption: What will Yanjin Shop focus on in the future?

Zhang Xuewu. First of all, many people think that Yanjin Shop does not pay attention to brand building, and we really need to pay attention to this part and pay attention to the building of category brands.

Secondly, R&D is the long-term vitality of an enterprise, and we must continue to pay more attention to it.

Finally, don't be ambitious, don't always want to be fat, and maintain the company's own development rhythm.

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