Text: Node Finance, Jiucai.The 2024 Spring Festival Gala is the 9th consecutive appearance of Gujing Gongjiu, which can be called a "nail household", and the vintage puree Gu 20 is nicknamed "New Year's Wine" by the industry.
Liang Jinhui, chairman of Gujing Gongjiu, who was born in 1964, has also stood at the critical point of "retirement at the age of retirement".
In order to enter the "20 billion club", a few years ago, Gujing Gongjiu put forward a development plan for a total revenue of 20 billion. According to Gujing Gongjiu's "2024 Letter to All Employees", it is clearly stated that Gujing Gongjiu's revenue will successfully cross 20 billion in 2023.
At a time when the liquor industry is still in a period of deep adjustment, achieving such results, in the view of Node Finance, can already allow Liang Jinhui to retire with dignity. However, he didn't stop there.
Just a few days ago, Liang Jinhui once again proposed that the target for Gujing Gongjiu in 2024 is 30 billion yuan. Can Gujing Gongjiu hand in a perfect career answer for this meritorious leader?
Jiudeng Spring Festival Gala, knocking on the door of the "20 billion club" There is a saying in the liquor circle, "the west does not enter Sichuan, and the east does not enter Anhui", which refers to the two major liquor provinces of Sichuan and Anhui. There are many wine companies in these two places, and the competition is fierce, and external wine companies should weigh it carefully if they want to enter these two regions.
"West does not enter Sichuan" is very easy to understand, and the six golden flowers of Sichuan wine, such as Wuliangye, Luzhou Laojiao, Shuijingfang, Jiannanchun, Langjiu, Shede, etc., are very powerful. Relatively speaking, the overall popularity of liquor companies in Anhui is not as high as that of Sichuan liquor, but if you comb through the 20 liquor listed companies, you can find that there are 4 liquor companies in Anhui (Gujing Tribute Liquor, Yingjia Tribute Liquor, Kouzijiao, and Golden Seed Liquor), accounting for one-fifth.
As one of the eight famous liquors in the country, Gujing Gongjiu is the undisputed boss of Huijiu, and its status in the province is transcendent. Its main product series are three series of "Vintage Puree", "Gujing Tribute Liquor" and "Yellow Crane Tower", and the main representative products are Vintage Puree Gift, Ancient 5, Ancient 8, Ancient 20, Ancient 26, Yellow Crane Tower Chenxiang 1979, Daqingxiang and so on.
However, if Gujing Gongjiu is put into the big market of national liquor companies, it is still outside the first camp.
In recent years, in order to enter the "20 billion club" of wine companies, Gujing Gongjiu has made great efforts. One of the most obvious measures is to appear on the stage of the Spring Festival Gala for nine consecutive years.
Behind this, of course, is the high marketing costs.
Node Finance has combed through the financial reports of Gujing Gongjiu over the years, and it can be found that high marketing expenditure has been around for a long time. In 2014, the marketing expenses of Gujing Gongjiu had reached 130.4 billion yuan, and its total revenue for the year was 465.1 billion yuan, and the proportion of marketing expenses to revenue is about 2803%。
In the three years of the epidemic (2020-2022), the marketing expenses of Gujing Gongjiu were 312.1 billion, 40080000000000000000000000006.8 billion, with a total of 117 marketing expenses in three years9.7 billion, accounting for the proportion of revenue among the listed companies in the entire liquor industry.
In the view of Node Finance, wine companies that spend a lot of money on marketing expenses are, to a certain extent, a manifestation of insufficient brand power. Of course, there are benefits to this method, which is simple and straightforward, and can quickly increase brand awareness. For Gujing Gongjiu, which aims to be in the national market, it is also a last resort.
In the 9 years that Gujing Gongjiu has spent a lot of money on the Spring Festival Gala, except for 2020, which was affected by the epidemic, its revenue has achieved positive growth, and its performance has also increased from 46 in 20145.1 billion yuan, all the way up to 167 in 2022100 million; Net profit increased from 5 in 20149.7 billion yuan, an increase of 31 in 20224.3 billion yuan.
Although the 2023 financial report has not yet been released, Node Finance believes that if there is no accident, it should not be a big problem for Gujing Gongjiu's revenue to exceed 20 billion yuan. However, there are still many challenges to grow from 20 billion to 30 billion in 2024.
Competition in the province is intensifying, and strong enemies outside the province are waiting for you From the perspective of the industry environment, the adjustment of the entire liquor industry has not ended, and there are generally problems such as upside down and high inventory.
Specific to Gujing Gongjiu, the financial report data shows that at the end of 2022, the inventory of its vintage puree series wine increased by 78% year-on-year15% to 2460,000 tons, and the inventory scale at the end of the period was 605.8 billion yuan, a year-on-year increase of 2034%。In the first half of 2023, the inventory of vintage puree series wine recorded a year-on-year increase of 5351% to 1710,000 tons, and the inventory at the end of the period reached 644.4 billion yuan, an increase of 24 percent year-on-year74%。
Vintage puree is the core product of Gujing Gongjiu, and behind the continuous increase in inventory is the pressure from the sales side. In the provincial market, although Gujing Gongjiu is the boss of Huijiu, in the cold winter of the industry, the involution of the "brothers" of the same province such as Yingjia Gongjiu, Kouzijiao, and Golden Seed Liquor is becoming increasingly intense.
In the view of node finance, Gujing Gongjiu has opened the product echelon, and the product structure has been continuously upgraded, and it is not a big problem to deal with competition in the province. The real test comes from the competitive pressure outside Anhui Province.
For the competitive pressure outside the province, we can look at it from two dimensions, on the one hand, the impact of external strong brands on the "base" of Gujing Gongjiu. First-line brands such as "Mao Wulu Fen" continue to expand production, channel sinking accelerates, and continues to conquer the city to seize the provincial market of Gujing Gongjiu.
On the other hand, Gujing Gongjiu also has an ambition of "nationalization". In recent years, it has continued to develop the national market, but the effect is not ideal. Today, most of its revenue contribution is concentrated in central China, centered on Anhui and Hubei.
According to the financial report, in the first half of 2023, Gujing Gongjiu will achieve an operating income of 113100 million yuan, and the revenue in Central China accounted for 8649%。From the perspective of the regional distribution of distributors, as of the first half of 2023, the total number of Gujing Gongjiu distributors is 4,341, of which 2,649 are in Central China, accounting for about 61%.
There are many wine companies that want to achieve nationalization, and only a handful of them have really broken out of the encirclement. Gujing Gongjiu only exceeded 10 billion yuan in revenue in 2019, and then caught up with the epidemic and industry adjustments, and it is not easy to enter the "20 billion club", and it is very difficult to go further.
Of course, Gujing Gongjiu also found the problem, and in order to go further, in addition to continuing to increase marketing, it also embarked on the road of cross-border and mergers and acquisitions.
Big health, mergers and acquisitions, are embarrassingWine companies play cross-border, last year's most out of the circle was Moutai and Luckin launched the "Sauce Coffee", Gujing Gongjiu is not far behind, in September last year, it cooperated with Baxi to jointly launch an ice cream product.
Similar to the logic of Moutai joining hands with Luckin, the reason why Gujing Gongjiu chose ice cream is also to shorten the distance with young consumers. Once out of the circle, it is indeed possible to expand the consumer group and open up new markets.
However, Node Finance would like to emphasize here that the launch of ice cream and other similar products by liquor companies is not the first initiative of Gujing Gongjiu, nor is it new, and the actual results are not outstanding. In order to open up the consumer market, Gujing Gongjiu has other attempts.
In November 2022, Gujing Gongjiu signed a strategic cooperation agreement with Yangsheng Tianxia, aiming at the big health industry, establishing Gujing Health, and crossing the border into the big health industry of traditional Chinese medicine. According to Node Finance, Gujing Health has successively launched a series of drinks, such as "Xin Liver Baobei Plant Fermentation Drink", "Xin Liver Baobei Rose Cranberry Enzyme Drink" and so on.
For the cross-border operation of the big health industry, Gujing Gongjiu seems to have high expectations.
In this regard, Liang Jinhui once said that in the "post-20 billion era", Gujing Gongjiu should give full play to the advantages of Bozhou's traditional Chinese medicine and other resource endowments to make health wine and health wine. Moreover, Gujing Gongjiu is also targeting the whisky industry and is preparing to develop traditional Chinese medicine whisky products.
One thing to say, Gujing Gongjiu's ambitions are quite big, but in the eyes of Node Finance, whether it is health wine or traditional Chinese medicine whiskey, the gimmick is greater than the actual effect, and I am afraid it is difficult to really take charge of it. In addition to cross-border operations, Gujing Gongjiu has also made a lot of efforts in mergers and acquisitions, and its representative work is the acquisition of Huanghelou Liquor.
After the completion of the acquisition in 2016, until 2022, Huanghelou stepped on the line to complete the performance VAM. In 2021, its revenue was 170.7 billion yuan, 205.2 billion yuan. It can be found that in the short term, the Yellow Crane Tower's contribution to the performance of Gujing Gongjiu is still limited. On the other hand, Huanghelou Liquor was also involved in suspected fraudulent marketing, which was once on the hot search, which made Gujing Gongjiu quite embarrassed.
In general, Node Finance believes that during the current deep adjustment of the liquor industry, Gujing Gongjiu is worthy of praise for entering the "20 billion club" as scheduled. But then it will be difficult to advance to 30 billion in revenue in 2024. There is little room to continue to increase marketing expenses, and methods such as cross-border health industry and outbound mergers and acquisitions seem to have limited effect.
If the current predicament can be solved, the future of Gujing Gongjiu will be worth looking forward to, and everything is still in their own hands.