Source: Official Weibo
Text/ Han Lu Editor/ Li Huilin Chen Xiaoping
As the Dragon Boat Festival approaches, Zongzi enters the hot season as a seasonal food, and the traditional long-established Wufangzhai has also entered the busiest time.
According to the rhythm of Wufangzhai, every year one month before the Dragon Boat Festival, the company will enter a state of preparation. This year, in addition to product marketing, Wufangzhai disclosed the prospectus, officially opened the IPO, and hit the "first share of Zongzi".
In the past 100 years, Wufangzhai has developed from a "small workshop" to a well-known "Zongzi King", almost becoming synonymous with Zongzi. According to the 2020 data, Wufangzhai can sell about 370 million rice dumplings a year, with an income of 2.42 billion yuan.
The listing has been full of twists and turns
In 1921, the predecessor of Wufangzhai "Rongji Wufangzhai" was founded by Lanxi businessman Zhang Jinquan in Jiaxing, Zhejiang Province, and produced and sold rice dumplings in the mode of the former store-back factory.
Wufangzhai during the Republic of China period
In 1992, Jiaxing WufangZhai Zongzi Subsidiary was established, and the following year it was rated as "China Time-honored Brand". After 1998, after two restructurings, the current entity to be listed was formed - Zhejiang Wufangzhai Industrial Co., Ltd.
In 2019, Wufangzhai opened the road to listing. In April 2019, GF Securities and Wufangzhai signed a listing counseling agreement with the securities company, but five months later, GF Securities and Wufangzhai reached a consensus to terminate the listing counseling and CICC took over.
In September 2020, Zheshang Securities replaced CICC and finally completed the listing counseling work of Wufangzhai in March 2021.
Zongzi series is the leading product of Wufangzhai, the sales volume in 2018 and 2019 was basically stable at 400 million, and in 2020, affected by the epidemic, it sold less, and the sales volume dropped to 365 million, contributing 70.77% of the revenue.
In order to alleviate the disadvantages brought about by the off-peak season and product cycle of Zongzi production and sales, Wufangzhai takes "glutinous rice" as the main line, develops salted eggs, mung bean cakes, mooncakes, green dough, tangyuan and other products around various festivals such as dragon boat festival, Mid-Autumn Festival and Spring Festival, and establishes production bases in Heilongjiang, Jiangxi, Jiaxing, Chengdu and other places to expand the upstream and downstream industries of food.
In 2020, Wufangzhai's revenue and profit showed a "double decline", with revenue falling by 3.44% year-on-year to 2.421 billion yuan, net profit of 142 million yuan, down 12.90% year-on-year, and comprehensive gross profit margin of 44.57%.
The decline in net profit was related to the rise in raw material and labor costs. The main raw materials required for the production of Wufangzhai food: pork and rice unit prices have risen last year, and the cost of raw materials accounted for 28.68% of revenue, up 2.91% year-on-year.
As a non-standard product, the production and manufacture of rice dumplings has always been difficult to completely separate from artificial labor. Previously, Wufangzhai brand director Xu Wei told the "21CBR" reporter that in the production process of Wufangzhai factory and central kitchen, the early stage of ingredient cleaning, selection and later packaging can be automated, and the bandaging link of zongzi, because the shape, strapping tightness and method are difficult to unify, still need to be manually completed, an experienced wrapper, up to 3,000 zongzi a day.
Wufangzhai has been improving the level of automation in recent years, in 2020, the company's annual production capacity of rice dumpling series products has reached 450 million, and the capacity utilization rate is 60.57%, and it is expected that the company's future capacity utilization rate will be greatly improved.
At the time of product line expansion, Wufangzhai is also expanding channels.
In 2009, Wufangzhai began to lay out e-commerce, at the beginning, dealers did not understand, with the maturity of the management system, the price of the unified online and offline channels gradually integrated, e-commerce sales from more than 8 million per year revenue, gradually increased to 670 million yuan in 2020 revenue, accounting for 28.89% of revenue, ranking first among all channels.
Catering channels have also become the focus of Wufangzhai layout. WuFangzhai had run a state-run restaurant since 1956 and only after 1994 did it focus on retail. In 2008, Wufangzhai decided to return to the old business and open a catering business, and now there are 169 directly operated stores and 43 cooperative stores.
Although offline stores are mostly loss-making, Wufangzhai is still investing and plans to set up 51 new direct-operated stores in the next three years.
Xu Wei introduced that all food in Wufangzhai restaurants is uniformly distributed by the central kitchen, and the store is only responsible for simple processing. While these restaurants provide fast food, they also help Zongzi become a food for three meals a day, no longer limited to festive foods.
The old brand is also a national tide
In the consumption of Zongzi, traditional brands have always been quite popular, and every Dragon Boat Festival, Zongzi started with Wufangzhai and the popularity is even higher.
Wufangzhai does not stick to the traditional baggage, product manager, national tide IP and other gameplay, so that it is revitalized.
Since 2016, Wufangzhai has carried out organizational changes to improve the operational efficiency, team combat capabilities and innovation capabilities of enterprises.
Wufangzhai is originally a division system, divided into three major blocks: food, e-commerce and chain, all equipped with corresponding products, marketing, warehousing, logistics, administration, finance and other personnel. Sales managers are responsible for pushing products to the channel, and innovation and R&D are usually initiated by the channel side.
This round of reform cancels the division system, the establishment of product managers, when the sales of a product reaches 100 million yuan, it will be set up separately for its product manager, the whole process of products from research and development, listing to sales of unified management, production, brand, channels and other parties of resources unified coordination, back-end functional departments are unified support.
Wufangzhai also transformed the branch into a dealer, adjusted the general agent or general dealer into a strategic partner, and opened up channels with social resources to transform the enterprise into light assets and light manpower.
In this way, the personnel and communication process has been greatly streamlined, the original 300 departments have been reduced by nearly 100, and the original eight or nine levels of approval decision-making, no more than three levels. The average time spent on the normal process has been reduced from 10 days to 3 days, and the company's staff has been reduced by nearly 100 people.
Product decisions and marketing decisions are lighter, more efficient, and more fashionable.
Inside Wufangzhai, there is a slogan that "only innovation rooted in tradition can lead the revival of the industry".
The old brand should be young, Xu Wei frankly said, if you just ask for celebrity endorsements, the cost is high, and the traditional cultural characteristics are difficult to reflect, so Wufangzhai not only innovates in taste, but also looks for suitable national tide IP, with the help of the Internet, the century-old brand will be trendy, interesting and creative.
Especially in recent years, a series of innovative advertising short films have reacquainted the outside world with this young "old brand".
In 2018, Wufangzhai launched the retro style advertisement of "Meet 1989" in chongyang Festival; in 2019, Zhou Xuan sang the Republic of China-style advertising film "Wufangzhai", the Dragon Boat Festival of the same year, the short film of "Guest House", with the science fiction style to give Zongzi the connotation of the universe, and in the mid-autumn of that year, in the form of animation and silhouette, launched the national comic advertising film "Bridge Crossing".
In 2020, Wufangzhai produced the healing Department Spring Festival short film "Careful Heart", echoing the epidemic situation, and the Dragon Boat Festival also prevaricated the humorous short film "Friends Dipped Up".
Wufangzhai also has the reputation of "Wufang Pictures".
Brand rejuvenation and continuous value-added are still the goals of Wufangzhai . Wufangzhai is expected to raise 1.056 billion yuan, mainly for investment in hardware projects such as Wufangzhai smart food workshop and digital industry smart park, and is preparing to upgrade and expand the zongzi production line to increase the market share of the product series.
The core element that hinders Wufangzhai is soft.
The company's main products zongzi, moon cakes and other traditional seasonal foods, there are obvious seasonal characteristics, especially zongzi, sales are concentrated before the Dragon Boat Festival, and a large number of gift scenes, this category characteristics limit its development space, sales for three consecutive years hovering around 2.5 billion.
Only by changing the seasonal attributes of the rice dumpling category and increasing the frequency of consumption can the brand value of Wufangzhai be truly released, which is also innovative and wise.
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