Nesher spent 1 billion yuan to set his sights on this 100 billion track

Image source @ Visual China

Text | Bohu Finance, author | Spirits

01 Nesher, add bottled drinks

Recently, Nesher was rumored to be in urgent need of acquisition of the Ready To Drink production line due to the surge in sales of ready-to-drink products, and the planned investment scale is between 5 billion and 1 billion.

It is reported that the specific requirements for the RTD production line of Neixue's tea are: the region is concentrated in East China and South China; the production capacity scale reaches 70-80 million boxes per year; the production line must have 8-12; the technical requirements are aseptic cold filling, the degree of automation is high; the team has more than 10 years of factory management experience...

In this regard, Naixue's tea responded to the media: the company is indeed vigorously developing the bottled beverage business, and in 2021, It has established The Nesher Beverage Technology Company, and has launched 7 bottled tea products to the market. As for investment rumors, it is "inconvenient to disclose".

As Nesher's tea responded, it actually had a layout in bottled drinks. In October 2020, the first Nesher sparkling water was launched, and in July 2021, Nesher Beverage Technology Co., Ltd. was established. At present, its bottled beverage products cover three categories: sparkling water, sugar-free tea and juice tea.

It is worth noting that other products, including retail products such as Neixue sparkling water and tea gift boxes, and souvenirs, will have a revenue of 170 million yuan in 2021, accounting for 3.9% of the total revenue, with a relatively small share.

Spending 1 billion yuan on the bottled beverage business, while the previous annual revenue was actually less than 170 million, such an investment can not help but speculate: Nai Xue is going to make bottled drinks?

Such speculation is not without logic. After all, tea brands are eyeing bottled beverages, which is nothing new.

Since the beginning of 2019, Heytea has taken the lead in attacking the field of sparkling bottled beverages, with new sparkling water products. In 2020, Heytea determined the direction of bottled water for juice, and in June 2021, it launched two juice tea drinks for the first time, the Mediterranean Myrtle Golden Phoenix and the Iberi Grapefruit Green Leaf, corresponding to the fresh drinks Zhizhi Peach and the full cup of red grapefruit respectively.

Some tea brands are busy launching bottled beverage products, and some are busy registering trademarks, "sharpening knives". At the end of last year, Michelle Ice City applied for the registration of the "Snow King Loves to Drink Water" trademark, classified as beer and beverage; the parent company of Lele Tea registered trademarks such as "Happy Tea" and "Bottle Tea".

These initiatives show that brands have set their sights on the bottled beverage business.

02 Tea drinks have entered the bottled drinks, why?

Obviously, at this stage of the tea drinking track, it is not too much to describe it as "roll".

According to the "2021 New Tea Beverage Research Report", at the end of 2019, the total number of mainland beverage stores was about 427,000, and the number of stores at the end of 2020 was about 596,000. Among them, new tea stores accounted for the highest proportion, reaching 65.5%, and the number of stores was about 378,000. According to Red Meal data, the number of financing events and the amount of financing disclosed in the new tea drink in 2021 reached the peak of nearly 10 years.

In June 2020, There were nearly 10,000 stores in Michelle Ice City. By October 2021, Michelle Ice City's stores had doubled to more than 20,000, almost a year to complete the total number of stores opened in the previous two decades.

It's not just Honey Snow Ice City that's expanding vigorously. In 2021, the number of new stores in Chabaidao and Guming will exceed 2,000, and Aunt Shanghai will maintain the annual increase rate of 1,000 stores for three consecutive years.

To what extent is the tea drink rolled up? It can be said that whether it is a first- or second-tier city or a sinking market, wherever there are users, there are new tea drinks. What's more exaggerated is that many brands have begun to roll themselves. In the streets and alleys of the downtown area, it is not a new thing to walk one or two hundred meters to meet a Honey Snow Ice City.

In fact, in the past two years, the bottleneck of the development of tea brands has emerged. Xicha fell into the "salary cut and layoff" storm, NaiXue's tea lost money for four consecutive years, with a net loss of up to 145 million yuan, and Cha Yan Yuese concentrated on closing 87 stores, during which internal disputes were also triggered by salary adjustments.

By this year, several major brands positioning high-end tea drinks in Naixue Xi Tea Lele Tea have successively reduced prices, looking for more users in the tea drinking area below 30 yuan. In the context of the increasingly saturated domestic tea market, overseas has also become a new point of strength for brands.

Official data shows that from the end of 2018 to 2021, but in just 3 years, Michelle Ice City has opened more than 200 stores in Vietnam, with an average of 5 Michelle Ice City opening every month.

The bottled beverage market has also become a major choice for tea brands looking for increments. This is not unrelated to the opportunities in the bottled beverage market.

According to the data of the Prospective Industry Research Institute, the domestic soft drink market size is about 600 billion yuan, of which bottled tea accounts for 19.64%. That is to say, the bottled tea market targeted by tea brands has exceeded 100 billion. According to the data, the revenue of the tea beverage business in 2021 reached 6.272 billion yuan, an increase of 15.2% year-on-year.

The relevant person in charge of Xicha has said that for Xicha, entering the bottled retail field can not only expand the business boundary with the help of product and brand advantages, but also reach more people through offline convenience stores, supermarkets and e-commerce channels, bottled beverages can cover more scenes compared with the convenient and easy-to-obtain characteristics of cup-made drinks, thereby improving the frequency of consumption and user stickiness, and complementing the ready-made tea business.

It is not difficult to understand that bottled drinks will be one of the power points of tea brands.

03 Growth curve of bottled beverages, tea drinks?

In fact, entering the bottled beverage market, new tea drinks have advantages.

New tea brands often already have their own fan user groups, and they can quickly reach potential users through stores after the product is launched. Under normal circumstances, if the product is really good, and there is brand endorsement, coupled with the corresponding marketing promotion, the possibility of going out of the circle on the social platform is relatively large.

It is reported that the heytea mini program heytea go has more than 35 million members, heytea with its own large number of member fans, each launch of bottled drinks can get a lot of attention.

In addition, with the continuous taste research and development of freshly made teas, this understanding of consumer taste preferences can also be applied to bottled beverages, so as to launch products that are more suitable for consumer tastes.

It is worth noting that what tea brands are vying for entry into is actually a highly competitive Red Sea market. At present, the main players are traditional beverage brands, new beverage brands and cross-border tea brands. Traditional brands such as Master Kong, Unity, Nongfu Spring, etc., all have strong channel strength.

Taking Nongfu Spring as an example, after a month of launching its sparkling aquatic products, it laid 1 million offline terminals, almost the total number of terminal sales points accumulated by Yuanqi Forest in the past few years, and the "30,000" channel layout of Heytea is more than 30 times different.

Compared with freshly made tea drinks, bottled drinks pay more attention to the offline channel layout. In the future, whether tea can break through in it, the opening of channels will be crucial. Zhu Danpeng, an analyst in the Chinese food industry, believes that in the bottled beverage track of the giant melee, only enterprises that truly have a sound industrial chain and supply chain and brand influence can succeed.

As of the first half of 2021, Master Kong's bottled tea market share is 42.1%, ranking first in the market.

Obviously, the bottled beverages of tea brands also play the role of catch-ups. It's bound to be a tough race, but it's not without a win.

References:

Pencil said: Nai Xue's tea took out 1 billion: to do something new

FMCG: 5-1 billion acquisition of ready-to-drink production lines? Nai Xue's tea is going to rob the farmers' market this time

Operation Research Agency: Chinese tea drink "harvest" overseas: 30,000 cups sold in 1 day, 2 years of wild profit of 300 million

China Beverage Express: Tea Drinks Enter Bottled Beverages What are the odds of winning?

Red Food Network: Xicha, Naixue, etc. have stepped into, bottled drinks into new tea to drink the next battlefield?

Three degrees official: the bottled beverage market is the next battleground for new tea drinks?