Kunpeng Project
A full year after Hundred Fruit Farm went on the market, it failed to celebrate its expected anniversary. On the contrary, the company's share price ended in **, the whole day** three percent, and then continued to decline, as of January 29, Baiguoyuan's share price was 3HK$14**, compared to the issue price of HK$6HK$56, down more than 48%. This event reflects the changes that are taking place in China's consumer market, namely the trend of consumption downgrading.
Baiguoyuan's success was due to its ability to seize the fast lane of China's consumption upgrade. At that time, more and more Chinese consumers were willing to pay more for quality of life, which led to the rise of high-end chains such as Baiguoyuan. However, in recent years, there have been significant changes in the market and consumption situation, which has led to the predicament of Hundred Fruit Garden.
First of all, we must note that Chinese consumers are experiencing a downgrade in consumption. There are a number of reasons behind this trend, one of which is the slowdown in economic growth. China's economic growth rate has declined over the past few years, which has led to a slowdown in income growth for a portion of the population. As a result, people are starting to spend their money more carefully and pursue more affordable ways to shop. This explains why the focus on value for money has outpaced the pursuit of brand and quality premiums.
Secondly, the livelihood problems of ordinary people have also had an impact on the downgrading of consumption. As house prices and rents continue to rise, the cost of living for people is also increasing. This has led many families to feel pressured on their daily expenses and have had to save on food, clothing, and other consumer goods. Therefore, they are more inclined to buy lower, more cost-effective goods, rather than pursuing high-end brands and quality.
In addition, the current state of the market also supports the trend of consumption downgrade. The rise of e-commerce has made it easier for consumers to compare the performance and performance of different products. This makes them more likely to opt for lower alternatives, rather than just pursuing brands and products. In addition, the integration of online and offline has also provided more options for sensitive consumers, who can look for more discounts and activities online.
In this market environment, the high-end fruit model of Baiguo Yuan is no longer applicable. While the quality and quality of their products may still be high, the quality of their products is discouraged by more consumers. This is one reason why Hundred Fruit Garden's share price has not performed well. Their business model and pricing strategy are no longer in line with current market trends.
However, there is some debate about whether the downgrade in consumption is a positive trend for the Chinese economy and markets. On the one hand, a downgrade in consumption may alleviate the financial pressure on some households, making them more affordable for the cost of living**. This helps to increase the stability of society. In addition, consumption downgrading may also prompt companies to pay more attention to product quality and cost-effectiveness, which is beneficial for improving the competitiveness of the overall market.
However, on the other hand, consumption downgrades can also have a negative impact on certain premium brands and businesses. Companies that have relied on premium prices for their products and brands in the past may be hit. This can also lead to increased competition in some industries, as businesses have to lower their ** to attract consumers, reducing profit margins.
Overall, it can be seen from Baiguoyuan's ** that consumption downgrade has become a significant trend in the Chinese market. This trend is driven by a variety of factors, such as slowing economic growth, people's livelihood problems, and the current state of the market. While there are some positive effects of consumption downgrading, it also comes with some challenges, especially for some premium brands and businesses. As a result, businesses in China need to adapt to this change and rethink their pricing strategies and product positioning to meet the needs of the current market. Only in this way can they remain competitive in a competitive market.