The founder of Daohuaxiang Group died: from scratch to a net worth of 8 billion yuan, his son has "taken over" in 2018

Reporter: Chen Qing Editor: Yang Xia

According to the official WeChat public account of Daohuaxiang Group, Cai Hongzhu, founder, secretary of the Party committee and lifelong honorary chairman of Daohuaxiang Group, passed away at 19:30 on December 24, 2023 at the age of 73 due to ineffective medical treatment. The reporter noticed that the homepage of the official website of Daohuaxiang Group, the official WeChat and the official Weibo avatar have all become black and white.

Cai Hongzhu's entrepreneurial journey is quite legendary. More than 40 years ago, he started from scratch in a soy sauce factory and founded the "Daohuaxiang" brand in 1992.

Today's "Rice Flower Fragrance" is one of the three famous liquors in Hubei and is well-known in Hubei. With the development and growth of "Rice Flowers", Cai Hongzhu's personal wealth has also increased. In October 2023, Cai Hongzhu and Cai Kaiyun ranked 755th in the "2023 Hurun Report" with a wealth of 8 billion yuan.

The official WeChat public account of Daohuaxiang Group has released an obituary. Image source: Daohuaxiang Group's official WeChat public account

It started as a soy sauce factory

Cai Hongzhu's entrepreneurial journey is legendary.

In the autumn of 1951, Cai Hongzhu was born in a peasant family in Qinglong Village, Longquan Town, Yichang, Hubei Province. When he was young, Cai Hongzhu's family life was very embarrassing. Cai Hongzhu also has three elder sisters, and in order to provide for Cai Hongzhu to study, the whole family saves money.

Due to various reasons, Cai Hongzhu was unable to continue his studies in school when he was young and returned home to farm. But even so, Cai Hongzhu is still full of ambition.

In 1982, 31-year-old Cai Hongzhu founded the first soy sauce factory in Qinglong Village, writing the famous story of "three people, three cylinders, and a loan of 1,500 yuan". He used a board truck to pull soy sauce to sell along the street, and within a few years, Cai Hongzhu became a well-known "10,000 yuan household".

Cai Hongzhu's goal is much more than that. A few years later, through the integration of Yichang's Xiaoxita Distillery, Qinglong Soy Sauce Factory, Shuanglong Beverage Factory and Tumen Distillery, Cai Hongzhu established Yichang Bailin Distillery and began to produce a variety of products such as soy sauce, liquor and soft drinks.

In the early 90s, Cai Hongzhu ushered in an important turning point - in 1992, Cai Hongzhu led the Daohuaxiang people to Sichuan to learn from the experience, and after nearly 1,000 explorations, brewed the "Daohuaxiang" liquor.

It was also in this year that Cai Hongzhu decided to stop the production of soy sauce and focus on the production of baijiu. It is worth mentioning that in 1992, Wuliangye, Moutai and Fenjiu had been triparted, and there were doubts about the future of Daohuaxiang.

"Those who are good at playing seek power, and those who are not good at playing seek their sons. Cai Hongzhu once said that the common people began to have money in their hands, so that they had the pursuit of a higher quality of life, and with the strong motivation of "drinking good wine", the rich Chinese formed a huge increase in the liquor market. Although the stock market is three strong, in the incremental market, everyone is on the same starting line, which is an opportunity for emerging brands.

The story of the fragrance of rice flowers unfolds slowly. In the recently released list of "2023 China's Top 500 Private Enterprises", Daohuaxiang Group ranked 180th in the country with an operating income of 60,521.28 million yuan.

With the development and growth of rice flowers, Cai Hongzhu has also gained the attention of the outside world. According to the official website of Daohuaxiang Group, Cai Hongzhu enjoys special allowances from the State Council and has served as a deputy to the 11th and 12th National People's Congress.

Xiao Zhuqing, a liquor marketing expert, met Mr. Cai at a conference many years ago. On December 25, he told reporters on WeChat that Cai Hongzhu was "very good" to dealers and suppliers.

"After some wineries have done a good job, they change distributors, and replace the distributors who follow them with relatives and friends. But many of Daohuaxiang's dealers have been cooperating for decades. Therefore, Daohuaxiang is very kind and honest. ”

The goal of the second generation of the head of the company is 10 billion

According to the official website of Daohuaxiang Group, Daohuaxiang started in 1982, founded the "Daohuaxiang" brand in 1992, and realized group operation in 1997. After more than 40 years of unremitting struggle, it has now developed into a large-scale enterprise group with liquor as the main business, supplemented by logistics, supporting facilities and cultural tourism. Among them, Hubei Daohuaxiang Liquor Co., Ltd. is the core enterprise of Daohuaxiang Group.

Image source: Daohuaxiang official website

What is the impact of Cai Hongzhu's death on the future development of Daohuaxiang Group? The reporter of "Daily Economic News" noticed that as early as 2018, Daohuaxiang Group has arranged a successor.

In December 2017, Cai Kaiyun, the son of Cai Hongzhu, was elected as the chairman of Daohuaxiang Group, and on January 10, 2018, Cai Kaiyun led the new members of the group's leadership team to officially appear.

Cai Kaiyun was born in 1972 and used to be a civil servant. Until 2006, 34-year-old Cai Kaiyun resigned from public office and joined Daohuaxiang Group.

After Cai Kaiyun took over the chairmanship, Daohuaxiang entered a new journey of entrepreneurship. For the company's future planning, in an interview with the "Three Gorges Daily", Cai Kaiyun once said that during the "14th Five-Year Plan" period, he will make every effort to promote the operating income of the main liquor industry to exceed 10 billion yuan, and other main supporting industries such as the packaging industry to achieve 10 billion yuan, and strive to "100 billion industrial clusters".

It is worth mentioning that although it is a well-known brand in Hubei, Daohuaxiang is still facing competition from many liquor brands nationwide.

On December 25, Zhu Danpeng, an analyst of China's food industry, said in an interview with the reporter of "Daily Economic News" that the nationalization process of Daohuaxiang actually started relatively early, but the overall effect was not particularly ideal at that time, and Daohuaxiang still focused on the Hubei market after that.

Zhu Danpeng believes that in the Hubei market, in addition to the fragrance of rice flowers, there are also brands such as Jinpai and Baiyunbian. At present, after the "second generation" Cai Kaiyun took the helm, the promotion of the market position of Daohuaxiang is not particularly obvious, which may be related to the fact that the "old man" Cai Hongzhu has not completely "delegated power". And after Cai Hongzhu's death this time, Cai Kaiyun may be able to "let go".

Xiao Zhuqing believes that Cai Hongzhu's death will have little impact on the future of Daohuaxiang Company, because Cai Kaiyun has been the chairman of Daohuaxiang for many years and has completely mastered the supply and marketing of Daohuaxiang Company's human resources, property, and property.

National Business Daily