Dongpeng Beverage's revenue exceeded 10 billion, and the next big item may be "hydration"

Text: Li Zhenxing

"Now it has been out of stock for a long time, and I have more than 2 million in my account, and Dongpeng Beverage just can't send the goods. A dealer told China Net Finance.

Dongpeng Beverage's products are very popular, and its revenue in 2023 will exceed 10 billion yuan.

According to the 2023 financial report released on April 14, Dongpeng Beverage's revenue reached 11.263 billion yuan, a year-on-year increase of 32.42%, and its net profit soared by 41.6% to 2.04 billion yuan.

In the financial report, Dongpeng Beverage analyzed the reasons for the significant increase in sales revenue in 2023 from the aspects of product structure and customer structure, channel market ratio and coverage breadth.

In the eyes of industry insiders, Dongpeng Beverage has exceeded 10 billion, and special drinks are the biggest contributors. Special drinks chose to compete in a dislocation and changed the packaging to larger bottles, which quickly opened up this sinking market. In the future, multi-category is the power point of Dongpeng Beverage, among which there is no absolute head product in the field of electrolyte water, and Dongpeng hydration or the next big item.

Dongpeng's special drink single product exceeded 10 billion yuan

Dongpeng Beverage's revenue has strode into the 10 billion yuan club from 8.5 billion yuan in 2022.

Chen Yingying, co-founder of Fighting Ant New Species Strategy Consulting, believes that the core of Dongpeng Beverage's revenue exceeding 10 billion yuan is brought by energy drinks. Dongpeng Beverage's innovation in energy drinks is different from the strategy of other brands imitating leaders, choosing to compete in a dislocation position, targeting the driver crowd, changing cans to bottles, which is convenient for drinking in the car, and the amount is large and affordable, which quickly opened up this sinking market.

As far as Dongpeng Special Drink, the main business income of Dongpeng Beverage mainly comes from Dongpeng Special Drink, accounting for 91.87% of its revenue. According to the financial report, Dongpeng's special drink revenue exceeded 10 billion yuan, reaching 10.336 billion yuan, an increase of 26.48% year-on-year.

Zhu Danpeng, an analyst of China's food industry, believes that Dongpeng Beverage's adjustment of market strategy is mainly reflected in the channel expansion of the northern market.

On the channel side, the number of distributors cooperated with Dongpeng Beverage increased from 2,779 to 2,981, and the cooperative distributors covered 100% of the prefecture-level cities in the country, and as of the end of the reporting period, Dongpeng Beverage's active terminal outlets in the country increased from more than 300,000 to 3.4 million, an increase of about 13.4% year-on-year.

In addition, Dongpeng Beverage's share in the market outside Guangdong is also gradually increasing.

Guangdong continued to implement the strategy of market segmentation, omni-channel intensive cultivation, and full product coverage, and constantly broke through the strategy of key groups, achieving sales revenue of 3.761 billion yuan, a year-on-year increase of 12.14%, and the proportion of revenue decreased from 39.50% to 33.44%;

By accelerating the expansion of terminal outlets in the country, Dongpeng Beverage continued to improve the construction of the channel system, improved the overall market coverage rate and coverage breadth of products, and achieved sales revenue of 6.024 billion yuan, a year-on-year increase of 41.40%, and the proportion of revenue increased from 50.17% to 53.54%.

Specifically, the sales revenue in Central China was 1.4 billion yuan, a year-on-year increase of 32.84%, the sales revenue in East China was 1.516 billion yuan, a year-on-year increase of 48.41%, the sales revenue in Southwest China was 1.115 billion yuan, a year-on-year increase of 64.71%, the sales revenue in North China was 1.01 billion yuan, a year-on-year increase of 64.83%, and the company's direct sales revenue was 1.465 billion yuan, a year-on-year increase of 67.03%.

In this regard, Dongpeng Beverage said that it continued to promote the national development strategy, strengthened the development of terminal outlets, and always insisted on achieving the ultimate in freezers and terminal high-potential energy displays.

According to the financial report, Dongpeng Beverage's publicity and promotion expenses increased by 35.69%, mainly due to the increase in freezer investment.

From the perspective of the industry, the growth of Dongpeng Beverage's performance is due to the fact that "the rising tide lifts all boats". The data shows that the total output of China's beverage industry in 2023 will be 175 million tons, with a growth rate of 4.06%, and in 2023, the industry's statistical sales revenue will be 520.2 billion yuan, with a growth rate of 7.26%, and the profit will reach 50.3 billion yuan, compared with 47 billion yuan in 2022, with a growth rate of 7.01%.

The next big item, hydration?

With a revenue of 10 billion yuan, Dongpeng Beverage's development has entered another stage of development.

For the future, Zhu Danpeng believes that Dongpeng Beverage will continue to develop in the five-way strategic planning of multi-brand, multi-category, multi-channel, multi-scene and multi-consumer groups.

A distributor told China.com Finance: "Dongpeng Beverage is now developing in diversification and multi-category. ”

Dongpeng Beverage said in its financial report that in 2023, the company has initially built a strategic framework with energy drinks as the first development curve and new fields such as electrolyte drinks, tea drinks, pre-prepared wines, and ready-to-drink coffee as the second development curve, focusing on building a multi-category matrix, and gradually developing steadily from a single category to a multi-category comprehensive beverage group.

It is understood that in January 2023, Dongpeng Beverage began to launch 555mL and 1L specifications of "Dongpeng Hydration" electrolyte drink (grapefruit flavor), and in July 2023, it launched diversified new products such as lemon flavor, lychee, white peach flavor, and 0 sugar.

In the field of tea drinks, Dongpeng Beverage has launched the first sugar-free tea drink - "Pengyou Shangcha" series "Oolong Shangcha". Dongpeng Beverage also launched the "Dongpeng Big Coffee Raw Coconut Latte".

Although the growth of Dongpeng Beverage mainly comes from Dongpeng Special Drink, Dongpeng Beverage said in its financial report that the proportion of revenue from other beverages will increase from 3.76% in 2022 to 8.13%, and the total revenue of Dongpeng Hydration and Dongpeng Big Coffee will account for 5.11%.

According to the data, the revenue of non-Dongpeng special drinks was 914 million yuan, an increase of 186.01% year-on-year. The gross profit margin was 17.25%, an increase of 0.18 percentage points year-on-year.

So, which will be the next big item of Dongpeng Beverage?

The above-mentioned distributor told China.com Finance: "The electrolyte drink 'Dongpeng Hydration' is good. ”

Dongpeng Hydration still adopts a similar strategy as Dongpeng Special Drink: large quantity and low price, that is, cost-effective.

In the eyes of distributors, there is no real head brand in the electrolyte beverage market, and the unit price of other brands is often five or six yuan in the fourth and fifth tier and county and township markets.

On the Jingdong platform, the active price of Dongpeng Hydrating La 24 bottles of 555ml is only 69.9 yuan, and the unit price is about 2.91 yuan, and the product price of 15 bottles of 500ml of traditional electrolyte water brand Pocari Water is 63.63 yuan, and the unit price is about 4.24 yuan. The price difference between the two products is quite large, but the content of nutrients energy, carbohydrates and sodium is similar.

The lack of production capacity may inhibit the performance growth of Dongpeng Beverage in the short term.

"Now 'Dongpeng Hydration' is not enough to sell," the dealer told China.com Finance.

However, the situation may soon bring a turnaround. Wind shows that Kou Xing, a food and beverage analyst at Huaxi Securities, believes that the current capacity utilization rate of Dongpeng Beverage has reached 86.3%, and the company's annual design capacity has increased from 2.8 million tons to 3.35 million tons. The timeliness of distribution has been effectively improved, providing strong support for the full implementation of the multi-category strategy.