China is a major producer and consumer of beverages, with a cumulative output of 174,997,700 tons last year, a year-on-year increase of 4.1%. Beverages can generally be divided into alcoholic beverages and non-alcoholic beverages, non-alcoholic beverages, also known as soft drinks, refer to natural or artificially formulated beverages with an alcohol content of less than 0.5% (mass ratio).
According to the different raw materials, product forms and functions, it can be divided into ten categories, including carbonated drinks, fruit juice (pulp) and fruit juice drinks, vegetable juice drinks, milk-containing drinks, vegetable protein drinks, bottled drinking water, tea drinks, solid drinks, special-purpose drinks, and other beverages.
In the market, well-known enterprises such as Nongfu Spring, China Resources C'estbon, Baisui Mountain, Wahaha, Master Kong, Tongyi, Yangyuan Beverage (six walnuts), Chengde Lulu, Yili, Mengniu and so on have emerged. Dongpeng Beverage is also one of the leaders, with revenue exceeding the 10 billion mark for the first time in 2023, a year-on-year increase of 32.42% to 11.263 billion yuan, and a net profit increase of 41.60% year-on-year to 2.040 billion yuan, also hitting a record high.
It is worth mentioning that its fist product "Dongpeng Special Drink" has become a single product of 10 billion yuan, with a year-on-year increase of 26.48% to 10.336 billion yuan in revenue last year, which is also the only local energy drink brand at the current level of 10 billion yuan, with sales reaching 2,384,550 tons, a year-on-year increase of 28.24%, which is equivalent to selling about 4.8 billion bottles (cans) based on a bottle of 500ml.
According to NielsenIQ data, Dongpeng Special Drink 500ml bottled beverage is the third largest single product in the Chinese beverage market (in terms of sales). In China's energy drink market, Dongpeng special drink sales accounted for 43.02%, an increase of 6.3 percentage points year-on-year, ranking first for three consecutive years, 12.2 percentage points higher than the Red Bull system as a whole, and the proportion of sales increased by 4.32 percentage points year-on-year to 30.94%, ranking second.
According to public information, Dongpeng Beverage has 9,460 employees and has ten production bases in Guangdong, Anhui, Zhejiang, Hunan, Guangxi, Chongqing, Tianjin and other places, and has reached a production base with a design capacity of more than 3.35 million tons/year. As of the end of last year, there were more than 3.4 million terminal sales outlets nationwide, and the number of dealers who maintained stable cooperation increased to 2,981, achieving 100% coverage of prefecture-level cities.
The predecessor of Dongpeng Beverage is Shenzhen Soybean Milk Beverage Factory, which was established in 1987, and its main products are the "old three" of carton beverages in Guangdong: chrysanthemum tea, herbal tea, and winter melon tea. However, due to poor management, it was on the verge of bankruptcy in 03.
The leader who staged a Jedi comeback was Lin Muqin, the current chairman and president. He was born in Shalang Town, Hongwan Town, Shanwei, Guangdong, and worked in a joint venture beverage company for 10 years. Later, he jumped to Shenzhen Soybean Milk Beverage Factory as the general manager of sales, imitating Red Bull to develop "Dongpeng Special Drink", but this product was not taken seriously.
At the critical juncture, Lin Muqin and more than 20 employees pooled 4.6 million yuan to buy the brand and production equipment. He first started from controlling costs, saving a penny in packaging procurement, relying on the strategy of small profits and quick turnover, and the output value increased from 15 million yuan at the time of taking over to 250 million yuan in 2010.
While "throttling", it is also necessary to actively "open source", Lin Muqin turned out the Dongpeng special drink. He was well aware that the key was to challenge Red Bull to differentiate himself: the first PET bottle with a dust cap to distinguish it from metal cans, and the price was half that of Red Bull. At that time, most enterprises regarded first-tier cities as important markets, but Lin Muqin took the initiative to "sink" and took Dongguan as a model market for Dongpeng Special Drink. To this end, Kang Qizu and Miss Tang in "Foreign Daughter-in-law Local Lang" were specially invited to endorse, and quickly opened the market, with sales exceeding 100 million.
In 2013, Dongpeng Special Drink began to enter the national market and spent a lot of money to sign Nicholas Tse as a spokesperson. In the same year, Red Bull abandoned the advertising slogan "Drink Red Bull when you are thirsty, and drink Red Bull even more when you are sleepy and tired", Lin Muqin took the opportunity to "pick up the leak" and changed his advertising slogan to "Tired and sleepy, drink Dongpeng Special Drink", and later added the slogan of "Young must be awake and fight", aiming at the young group.
Since 2016, China Red Bull (Reignwood Group) and Thailand Tencel have been engaged in a multi-year tug-of-war over the trademark authorization period, which has prevented effective advertising and affected distribution channels. Dongpeng Special Drink seized the strategic window period and quickly grabbed a large market share. In May 2021, Dongpeng Beverage landed in the capital market and became the first listed functional beverage company in China. On the "2024 Hurun Global Rich List", Lin Muqin, Lin Yupeng and his son ranked 595th with a net worth of 38 billion yuan.
Dongpeng Beverage, which has entered the "10 billion club", is not at ease. In the functional drink market, Red Bull is still the big brother, and behind Dongpeng Special Drink, there are many brands such as Lehu, Physical Energy, War Horse, XS, Enough Burn, Awakening Source, Devil's Claw, Qili and so on. In the past two years, Jianlibao (Chaodeeng), Yuanqi Forest (Big Devil), Budweiser, etc. have also laid out the energy drink track, and the competition in the industry has become increasingly fierce.
Dongpeng Beverage is also aware of the problem of "only one big single product", and is trying to find the second growth curve, and has successively launched a number of new products such as electrolyte water (hydration), ready-to-drink coffee (Dongpeng coffee), sugar-free tea (Pengyou Shang Tea), cocktail (VIVI cocktail), and drinking natural water (Dongpeng water).
Last year, the company's other beverage revenue increased by 186.65% year-on-year to 914 million yuan, accounting for 8.13%, an increase of 4.37 percentage points, of which the total revenue of "hydration" and "Dongpeng coffee" accounted for 5.11%. However, it is worth noting that the competition between these two markets is equally fierce, and in the electrolyte beverage market, there are already strong competitors such as Pocari Shuite and Yuanqi Forest (alien), and in the field of sugar-free tea, Nongfu Spring and Suntory are the "two mountains" that latecomers need to climb.