"New Tea Drinking First Stock" Naisher's Tea (02150. HK, hereinafter referred to as "Nesher") was recently rumored to invest 500 million to 1 billion yuan to bet on the bottled beverage track. At the end of April, Nesher's Tea responded to the Red Star Capital Bureau that the company is indeed vigorously developing the bottled beverage business, but it is not convenient to disclose the investment matters.
In the bottled beverage market, Nesher's challenges are not small. Red Star Capital Bureau noted that the competition in the bottled beverage market is very fierce and has the tendency to intensify. Nongfu Spring (09633. HK), Yibao, Unification, Wahaha and other established beverage giants are still stationed in the front, and new tea companies such as Xicha, Lele Tea, and Michelle Ice City have also begun to lay out in the past two years. Judging from the best-seller list of goods at the 2021 China Convenience Store Conference, the new tea brand has not yet shaken the status of the old traditional beverage brand, and the online sales data of Naixue bottled beverages is not as high as That Tea.
While the new tea companies are laying out bottled beverages, traditional beverage companies such as Wahaha and Wang Laoji are also exploring the ready-made tea market in reverse.
The net loss in 2021 is hundreds of millions
Nesher continues to look for new growth points
Naisher's tea was recently rumored to be investing 500 million to 1 billion yuan to bet on the bottled beverage track.
In this regard, Naixue's tea has not disclosed specific information, but Naixue introduced to the Red Star Capital Bureau that it is indeed vigorously developing the bottled beverage business, and in 2021, Naixue Beverage Technology Company has been established, and 7 bottled tea products have been launched.
Earlier, in October 2020, Nesher entered the bottled beverage segment with a bottled sparkling water series and sold it at the Tmall flagship store. In the 2021 semi-annual report, Nesher said: "We expect to start launching retail products to offline chain shopping malls and other channels in the second half of this year. In the future, we expect the retail business to gradually become an important part of the Group's revenue. ”
At present, Nesher has spread bottled drinks to convenience stores such as FamilyMart, 711 and supermarket channels. Nai Xue revealed to the Red Star Capital Bureau: "At present, the convenience stores and supermarket channels of bottled tea in South China sell the best. ”
Naisher's tea bottle drink sales site Courtesy of the interviewee
Nai Xue told Red Star Capital Bureau that the existing business of stores has been temporarily affected by the epidemic, so the long-term planning will focus on three aspects, namely, accelerating automation equipment, deepening retail products, especially bottled (juice) tea series, and creating a more agile supply chain.
For the development of Naixue's bottled beverage business, Chinese food industry analyst Zhu Danpeng analyzed to the Red Star Capital Bureau: "In the past, Naixue may have been more OEM, and now it may become Naixue itself to operate and produce." ”
Red Star Capital Bureau noted that in addition to betting on the bottled beverage market, Neixue has also tried to find new growth points in the mid-end market by building sub-brands, reducing prices, and opening PRO stores. Behind this is the gradual calm of the new tea industry, and the growth rate of the revenue of the new tea brand is slowing down.
Taking Nesher as an example, from 2018 to 2021, its revenue was 1.087 billion yuan, 2.502 billion yuan (an increase of 130.17%), 3.057 billion (an increase of 22.18%), and 4.297 billion yuan (an increase of 40.56%), respectively. In 2021, Nesher's adjusted net loss was $145 million.
Old players are stationed, and new players are entering the game one after another
Nesher's challenge of making bottled drinks is not small
The bottled beverage "battlefield" has long been full of smoke, from the perspective of volume and seniority, Nai Xue and other new tea brands are probably difficult to compete with the old players on the field.
In 2021, the total revenue of Nongfu Spring will reach 29.696 billion yuan, and the total revenue of Wahaha is expected to be about 50 billion yuan; while The revenue of Naixue's tea in 2021 will be 4.297 billion yuan, which is only about 1/7 of Nongfu Spring, and even less than 2/3 of the emerging brand Yuanqi Forest. According to the performance data disclosed by Li Guoxun, vice president of Yuanqi Forest, the revenue of Yuanqi Forest in 2021 is 2.6 times that of 2020 (2.7 billion yuan), and according to this calculation, the revenue of Yuanqi Forest in 2021 is about 7 billion yuan.
It is rumored that Naixue will invest 500 million to 1 billion yuan in the bottled beverage business, and the total cost of Nongfu Spring in 2021 has reached tens of billions of yuan, of which 125 million yuan has been invested in research and development. Some insiders told red star capital bureau bluntly: "What is this 1 billion enough?" It may be a fraction of the leading companies in the industry such as Coca-Cola and Nongfu Spring. ”
According to the data released by the China Chain Store & Franchise Association at the 2021 China Convenience Store Conference last May, there are no new tea brand bottled beverages on the beverage list. On the one hand, this shows that the brand influence of new tea in the bottled beverage market needs to be improved, on the other hand, it also reflects that the brand of new tea is still weak in the offline retail channels of traditional and established beverage companies.
The price of bottled beverages of new tea brands is also higher than that of traditional bottled beverages, and the official flagship store of Xicha Juice Tea Tmall is priced at about 7.8 yuan a bottle, and The discount price of Naixue's tea is 6.6 yuan (the regular price is 8 yuan).
However, Zhu Danpeng believes that the new tea brand also has advantages in the competition with traditional beverage giants, because the category is popular with consumers and is itself a big IP. However, the large number of fans accumulated by the brand has brought advantages to the early development, and whether the follow-up will continue to dominate still needs to wait for the market to test.
In addition to the need to compete with bottled water/beverage giants, Nesher also needs to meet the challenges from its new tea drinking rivals.
Red Star Capital Bureau learned that Heytea began to lay out the bottled beverage track in 2019 and launched the "Xixiao Tea Bottle Factory" in June 2020. Xicha told the Red Star Capital Bureau that the reason for doing bottles is that one is to transfer the taste of the ready-made products to the bottle, so that the products are more diversified; the second is that the consumption scene and frequency of bottled drinks are different, which can complement the ready-made tea drinks.
At the end of 2020, Shanghai Tea Field Catering Management Co., Ltd., the parent company of Lele Tea, also applied for the trademarks related to "Happy Tea" and "Bottle Tea"; Michelle Ice City obtained the "Bottle (Snow King Loves to Drink Water)" appearance patent authorization in 2021, and in March 2022, it obtained the "Bottle Sticker (Baqi Series)" appearance patent authorization; And Cha Yan Yue also registered a number of beverage companies in the past two years, and its business scope includes beverages, cold drinks and catering services.
Compared with the current sales data of bottled beverages in the Tmall flagship store of Neixue and Xicha, the monthly sales of 15 bottles of Heytea juice tea are 4000+, and the monthly sales of Nesher juice tea are only 600+, which shows that the challenges faced by Naixue are not small.
If Naixue's tea invests hundreds of millions of yuan in the unfamiliar and highly competitive business of bottled beverages, Zhu Danpeng believes that this may erode Nesher's profits - the management system will be more difficult and the management cost will be correspondingly increased.
Whether the taste of bottled drinks will have a negative impact on the entire brand is also one of the risks facing Nesher.
However, Zhu Danpeng also believes that there is a certain incremental space in the entire ready-to-drink market, and there is nothing wrong with Nai Xue's strategic direction of choosing to bet on the bottled tea market. "The key points of competition for new tea brands to make bottled beverages are brand appeal, number of fans, brand tone, etc. The general giants can do it, and other small brands can't do it. In the giant melee with brand influence, only enterprises that truly have a sound industrial chain and supply chain can succeed. ”
Established beverage companies are in the opposite direction
But the temptation didn't work well
Red Star Capital Bureau found that while new tea drinks are betting on bottled beverages, traditional beverage companies are also trying to enter the ready-made tea market.
In December 2017, Wang Laoji stepped on the outlet of freshly made tea drinking and opened the first store of "1828 Wang Laoji Brewed Herbal Tea" in Guangzhou, and publicly stated that he would strive to achieve the operation scale of 3,000 stores nationwide by 2021.
According to the official website of Wahaha Milk Tea, since the end of 2019, Wahaha has opened an offline tea shop brand project. In July 2020, the first Wahaha milk tea direct store opened in Guangzhou, and on the opening day, the 75-year-old Zong Qinghou flew from Hangzhou to Guangzhou to stand for the store.
But two years later, Wahaha Milk Tea's first store in Beijing closed. On April 28, a Wahaha milk tea franchise business contact told Red Star Capital Bureau that the rent in Beijing was relatively high, and with the salary of the personnel, it did not make money in combination, so the store was closed. The above-mentioned contact said that at present, a store that does a good job of Wahaha milk tea can achieve a net profit margin of 40%-50%.
Wahaha Milk Tea Shop Picture according to Visual China
According to the narrow door restaurant eye data, Wahaha Milk Tea has 312 existing stores, 258 currently in the camp, 54 suspended business, and only 1 new store in 2022. According to Zhongxin Jingwei, for the future store planning, Wahaha said in the brand manual that it will open 10,000 Wahaha milk tea shops in 10 years. At present, it seems that this goal may be difficult to achieve.
Wang Laoji's "3,000 stores" goal also seems to be like a castle in the sky. According to the data of the narrow door restaurant, there are currently 76 "1828 Wang Laoji" stores, of which 59 are in operation and 17 are suspended.
In terms of brand influence, which is extremely important for new-style tea drinks, although Wang Laoji and Wahaha can be called "national brands", they can be seen from the number of fans on social media. As of press time, "Wahaha Milk Tea" Weibo fans have 67,000, "1828 Wang Laoji" Weibo fans have only 7,051 fans, while Nai xue's tea has 1.326 million and Xicha has 1.212 million fans.
Red Star News reporter Yuan Ye intern reporter Zhang Luxi
Edited by Yu Dongmei