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With the death of Zong Qinghou, the soul helmsman and a legendary Zhejiang businessman, how did the beverage giant Wahaha reshape its solid core in the war-torn beverage rivers and lakes?
On February 25, Zong Qinghou, the founder and chairman of Wahaha, died of illness at the age of 79.
As the founder of Wahaha, Zong Qinghou is not only the soul of the company, but also the representative of the domestic entrepreneurial wave in the 80s and one of the iconic figures of private entrepreneurs. Under his leadership, AD calcium milk, nutrition express, and eight-treasure porridge, which are popular all over the country, have been the childhood memories of generations of people.
The Paper said on February 22 that Zong Qinghou was in the ICU ward of Sir Run Run Shaw Hospital affiliated to Zhejiang University School of Medicine. According to Red Star News, Zong Qinghou was seriously ill with lung cancer before the Spring Festival and was admitted to Run Run Shaw Hospital, and his condition has not been good.
In 2023, Zong Qinghou said in an interview with ** that he will not retire, but will take a back seat, let young people charge in front, watch from behind, and turn around when he deviates and come up with some ideas. At the Wahaha National Sales Work Conference in December 2023, Zong Qinghou also made a public appearance, he said that "the beverage industry will always be a sunrise industry", and he must strengthen his confidence and strive for a better future by struggle, and plans to spend 100 million yuan to reward outstanding dealers.
At the end of 2023, Zong Qinghou and Zong Fuli Wahaha official accounts.
After the news of Zong Qinghou's serious illness broke, Wahaha also responded that Wahaha Group's various businesses were operating normally. In December 2021, Wahaha officially handed over the first place, and Zong Qinghou's daughter Zong Fuli became the vice chairman and general manager of the group, which also marked Zong Fuli's entry to the stage as the group's first person.
In the turbulent decade, Wahaha was a benchmark in the beverage industry. Now that it is the domestic market for mainstream consumers, many brands such as Coca-ca, Pepsi, and Yuanqi Forest have appeared in turn, and how Wahaha, which the second generation took over, has become the suspense of future development after losing its soul and how to maintain its position in the new era.
A legendAt the end of 2023, Wahaha's headquarters moved from Qingtai Street in Hangzhou to the bank of the Qiantang River, and although there is a new office building, the old site on Qingtai Street is the starting point of Wahaha Group.
In 1987, Zong Qinghou, who was not confused, resigned from his stable job and started a business at No. 160 Qingtai Street with a borrowed 140,000 yuan. On Labor Day this year, he contracted the "Shangcheng District School-run Enterprise Distribution Department" that had been losing money for two consecutive years, and started with a tricycle to provide delivery services such as popsicles and soda for school students.
In the first decade of the last century, the domestic health care products market was in full swing. After Zong Qing, who was in business, locked this track, he did not break through the ** market like his wife's oral liquid, but turned to children's oral liquid. At that time, Zong Qinghou also used newspapers to solicit product names and trademarks from the public, which had obvious marketing effects, and also gained the name "Wahaha", which later became well-known in the entire market.
In only three years, the output value of children's oral liquid exceeded 100 million yuan, and the profit exceeded 20 million yuan. Zong Qinghou, who dared to think and do, was not satisfied with the "children's health products" market and chose to further expand production capacity. In 1991, Wahaha, which had just over 100 people at the time, wanted to merge a large local state-owned factory with more than 2,000 employees, which was facing a debt crisis of up to 40 million yuan due to sales difficulties.
In the eyes of the ** at that time, Zong Qinghou's approach was even a little self-sufficient. Surprisingly, in the end, Zong Qinghou acquired the cannement factory at a "sky-high price" of 80 million, and took over all the employees at the site, and through drastic reforms, it turned losses into profits in only three months. This story has become a famous case of "small fish eating big fish" in the history of entrepreneurship, and because of this move, Wahaha officially entered the beverage field.
Since then, Wahaha has opened the road to the leader, and in 1992, the revenue reached 400 million, and the profit was as high as 70 million.
Next, AD calcium milk, which was born in 1996, laid a solid foundation for it to become a beverage empire, and this product can be said to be the peak of birth, producing 10 in just one year700 million bottles, creating an output value of 68.5 billion yuan;In 2009, the sales of AD calcium milk reached a peak, exceeding 3 billion yuan.
The birth of this explosive product made Zong Qinghou a veritable "drink king". After that, Wahaha went all the way up, creating miracles in product output value and revenue several times: in 2003, the output value exceeded 10 billion;Ten years later, the revenue reached 782800 million.
In the nearly 30 years from 1987 to 2013, Wahaha under the leadership of Zong Qinghou almost swept the beverage industry. In 2013, Zong Qinghou also topped the Forbes Chinese mainland rich list three times in four years. After 2015, Wahaha's performance had a bottleneck period, and from 2015 to 2020, the performance basically hovered around 46 billion, and the sales performance slowly rose to 512 in 20220.2 billion yuan.
The drinks are constantly at warLooking back at Wahaha's popular products, whether it is AD calcium milk launched in 1996, the smoothie drink nutrition express launched in 2005, or the solid drink Babao porridge series, each of them has accurately stepped on the node of the times, and almost all of them are classics.
But as time went on, these drinks, which had occupied the C position on the shelves, began to be replaced by latecomers. Coca, Pepsi, Yuanqi Forest, Oriental Leaves, in the current fierce competition for tea drinks, it is almost difficult to find Wahaha among many popular models.
Under the ever-changing consumption trend, Wahaha has also tried to catch up with the new trend, but after some operation, most of the response is mediocre.
In 2018, Yuanqi Forest, a new tea drink brand that rose overnight, single-handedly set off a boom in sugar-free drinks. 0 sugar and 0 fat have become the keywords of new consumption, and its Internet marketing model has swept the major social networks and quickly spread convenience stores in first- and second-tier cities, becoming a phenomenal explosive product before 2020.
Judging from sales, Yuanqi Forest has a bit of the shadow of Wahaha in its heyday. From 2018 to 2020, its sales growth rate reached %; Before 2019, the market share was as high as 85%. This has also triggered a number of brands to follow up on the sparkling water category.
The giant Wahaha's follow-up action was not fast, and it was not until August 2020 that it launched the sparkling water product "Angry Bobo"; In July 2021, Wahaha launched "Qingnai" sparkling water, positioning "beauty economy" and "health preservation", and trying the functional sparkling water track, but judging from the results, due to the serious homogenization of sparkling water on the market, the overall response is average.
Following sparkling water, sugar-free tea has become a new outlet in recent years. Among the products, the Oriental Leaf developed by Nongfu Spring, a veteran tea drink, was voted by netizens as one of the "five most unpalatable drinks in China" in 2016, but now it has become popular as the "ceiling" of the sugar-free tea industry.
In the field of sugar-free tea, Wahaha has been laying out since 2018. This year, pure tea products such as Anhua black tea, Yanyun oolong, and Pu'er tea were launched; At the 2022 sales work conference, "Into the Tea" was also launched, including two flavors: black tea and oolong tea. In addition, Zong Fuli founded the Kellyone brand in 2016 and also launched the sugar-free tea series "One Tea".
In recent years, the trend of sugar-free tea is still spreading. According to the "2023 China Sugar-free Tea Industry" released by Yiou Think Tank, sugar-free tea drinks have maintained a growth trend since 2017, and the compound annual growth rate of the sugar-free tea market is expected to reach 102%, the market size is about to reach 10 billion;In the next five years, China's tea market will enter a period of rapid growth and full explosion of sugar-free tea drinks.
Obviously, Wahaha does not intend to let go of this outlet. In December last year, Wahaha Group announced 14 new products at the 2024 National Sales Work Conference to prepare for 2024, including a number of hot categories, and among the more than 20 new products to be launched, sugar-free tea has become the focus.
From creating trends to passively following trends, Wahaha has faced many challenges in the fierce battle of the beverage industry in recent years.
The test of the second generationAt the Chinese New Year's Eve dinner of the 2024 Lunar New Year, Zong Fuli delivered a speech on the spot, and when she distributed gift packages to employees, she revealed that the year-end bonus "will be issued another 600 million". At this time in 2023, Zong Qinghou once said that the year-end bonus alone will reach 600 million.
The year-end bonus of up to 600 million yuan for two consecutive years conveys Wahaha's double growth revenue to the outside world. On the list of "2023 China's Top 500 Private Enterprises" released by the All-China Federation of Industry and Commerce, Wahaha's sales performance in 2022 is 5120.2 billion. From the performance point of view, it has come out of the trough after 2015, but compared with the peak revenue of 72.8 billion in 2014, it is still far behind.
When Zong Qinghou gradually retreated behind the scenes, and his daughter Zong Fuli walked to the front of the stage, Wahaha's future direction has always been the focus of attention from the outside world. In terms of the company's structure, Zong Qinghou is still the chairman of Wahaha Group, and Zong Fuli is the vice chairman and general manager of the group.
In recent years, there have been few popular models in Wahaha, but looking back at Zong Fuli's experience, it is not just the halo of the "second generation" on her head. He went to the United States to study at the age of 14, and after returning to China, he used the 10 million given by Zong Qinghou to create Hongsheng Beverage Group, a downstream enterprise of Wahaha, in a low-key manner, and established it in 2007 and served as the president of Hongsheng Beverage Group. It once said that in addition to the first pot of gold, follow-up investments are all on their own. In addition, Zong Fuli joined Wahaha Group after 2018 and successively served as the director of public relations.
Since the handover of the old and new in 2021, Zong Fuli has released relevant strategies in terms of products, brands, and sales at sales work conferences for several consecutive years. Since taking office, Wahaha has released a variety of new products, including sugar-free tea, coconut milk drinks, sodas, sports drinks and other categories.
Among the "second generation" who took over the family business, Zong Fuli's resume can be seen that she has long been cultivated as a first-class person. Zong Qinghou once scored 90 points for his daughter's performance in Wahaha on a talk show. However, judging from the performance in recent years, Wahaha, as a leader, has gradually declined its influence in the beverage industry, and it is difficult to impress consumers.
Wahaha was born in the era when offline channels are king, from leading the trend to passively following the trend, and now in the consumption era of live broadcast e-commerce and social e-commerce, it is difficult to produce AD calcium milk, Babao porridge and other fist products that have occupied the market for many years. The cycle of the tuyere is shortening, which puts forward higher requirements for the insight and creativity of consumer needs, and as a veteran enterprise, Wahaha's innovation ability seems to be insufficient, and it is inferior in product packaging, selling point refinement, and diversification.
However, Wahaha has also been trying to adapt to the new way of playing in the market in recent years. In the 2024 CCTV Spring Festival Gala in the Year of the Dragon, girls who drink AD calcium milk will also follow Wahaha's marketing and become popular during the Spring Festival. As a beverage empire, Wahaha's country is still stable, but after leaving Zongqing, how to reshape the stable core has still become a difficult problem for Wahaha.