"Huaxia Wine News" reporter Liu Xuexia
Under the guidance of the old liquor strategy, the steady growth trend of Shede liquor industry continued.
On April 25, Shede Liquor disclosed its first quarter report for 2024. According to the report, Shede Liquor achieved operating income of 2.105 billion yuan in the first quarter of 2024, a year-on-year increase of 4.13%, and net profit attributable to shareholders of listed companies of 550 million yuan.
During the industry adjustment cycle, in the face of the continuous intensification of the industry development situation and the pressure of market competition, Shede Liquor has built a solid foundation under the guidance of the old liquor strategy, interpreted the brand potential energy and growth potential with actions and achievements, demonstrated the stability and tenacity of the development path of "Shede characteristics", and laid a solid foundation for it to achieve revenue of 10 billion yuan.
The old wine strategy helps Shede achieve steady revenue growth
Combined with the financial report of the first quarter and the performance of Shede Liquor in recent years, it can be found that the old liquor strategy has become the core engine for the rapid and steady development of Shede Liquor.
In 2019, Shede Liquor proposed the old liquor strategy for the first time in the industry based on multiple leading advantages such as ecological liquor brewing and the scale of old liquor storage, and took it as the company's overall business strategy. The continuous deepening of the old liquor strategy has helped Shede Liquor to establish its industry status as the "market-oriented leader of Tanchu old liquor", and has become the driving force for its continuous growth in performance in recent years.
In 2023, Shede Liquor will achieve revenue of 7.081 billion yuan, an increase of 16.93%, and the revenue scale will gradually increase from 3 billion yuan in 2020 to 7 billion today, becoming a prominent member of the "10 billion reserve team" in the industry.
The main reason for the growth of Shede Liquor's performance in 2023 is the continuous promotion of the old liquor strategy, the further recognition of the old liquor market by consumers, and the increase in sales revenue.
Today, Shede Liquor has realized the quality closed-loop of "ecology + altar storage + science and technology innovation = a bottle of Shede old liquor", empowered by the brand value of "culture + old liquor", and successfully established a differentiated brand awareness in the high-end liquor consumption market through the old liquor category.
In 2024, Shede Liquor will continue to deepen the strategy of promoting old liquor and help upgrade product quality. On the one hand, it continued to increase investment in science and technology, and the R&D expenditure in the first quarter of this year was 28.57 million yuan, a year-on-year increase of 72%;
On the other hand, in order to enhance the production and storage capacity of raw liquor and improve the strategic quality foundation of old liquor, Shede Liquor will start the construction of production and capacity expansion projects in 2022. In March this year, the main project of the Longchi Ecological Brewing Workshop of Shede Liquor was completed, marking the substantial progress of this production and capacity expansion project, and accumulating strength for the development of Shede Liquor in the next ten years.
With the continuous expansion of the old liquor production capacity of Shede Liquor Industry and the continuous improvement of brand potential, it is foreseeable that in the future, the old liquor brand represented by "Shede" of Shede Liquor Industry will continue to gain more revenue in the high-end consumer market.
Tuopai is renewed, locking in the "second growth curve"
In addition to old wine, Shede Liquor's multi-brand matrix strategy is also accumulating more growth energy for it. Among them, it focuses on the growth of the dual brand of "Shede + Tuopai".
At the 2024 annual work conference, Shede Liquor proposed to awaken and renew Tuopai, reshape its brand positioning, and explore the "second growth curve".
During this year's spring sugar period, the two major brands of Shede Liquor and Tuopai Liquor made a joint appearance. The Tuopai Liquor Slogan has also been officially updated to "a classic liquor that sells 5 billion bottles", and at the same time, it is endorsed by the well-known "Long Years Liquor, Didi Tuopai Love".
In the current liquor consumption, the growth potential contained in the mass market has caused many liquor companies to compete for this track. Especially in the current consumption environment, famous wine products with high cost performance will be more favored by consumers. The return of Tuopai's brand value and industry status will undoubtedly help Shede Liquor to complete its position in the mass consumer market, increase revenue and create more possibilities for its "second growth curve" performance.
Judging from the growth rate of Tuopai market and the effectiveness of brand building, the results are also quite good. During this year's Spring Festival peak season, Tuopai's corkage rate soared by 163% compared to last year. In the first quarter, the sales revenue of ordinary liquor, mainly Tuopai, was 238 million yuan, a year-on-year increase of 0.85%. The large volume of Tuopai products in the mass consumer market will continue to inject new strength into the subsequent steady growth of Shede Liquor.
On the whole, the dual-brand strategy of "Shede + Tuopai" of Shede Liquor has obvious results. In both the high-end market and the mass market, the pace of market expansion has been more stable, showing strong resilience and vigorous vitality.
How will Shede Liquor Industry "stabilize and improve" in 2024?
In 2024, Chinese liquor will enter a new environment where "uncertainty, instability, and unpredictability" coexist. In such an environment, the development strategy and direction of the liquor industry are particularly important.
For Shede Liquor, in this crucial year, how to "stabilize and move forward" and achieve the goal leap?
At the 2023 Annual General Meeting of Shareholders held on April 23, Shede Liquor sent a positive signal to the outside world. Pu Jizhou, chairman of Shede Liquor, said that in 2023, the company will adhere to the strategy of "old liquor, multi-brand matrix, rejuvenation and internationalization", adhere to long-termism and altruistic customer thinking, take the road of high-quality and sustainable development, and achieve good results. In 2024, the company will adhere to the four major strategies, unswervingly build large single products, unswervingly increase high-end share, unswervingly promote the simultaneous development of national layout and regional deep cultivation, unswervingly promote the internationalization of the brand, and strive to achieve rapid growth.
To this end, Shede Liquor takes "ultimate productism" as the goal, further strengthens the advantages of products, brands, production and research, channels, markets, etc., and at the same time implements the "old liquor strategy", takes the brand as the center, integrates and links the channels and markets, and effectively activates the development momentum of the enterprise.
From the perspective of product structure, Shede Liquor continues to focus on tasting Shede's large single products, and building a long-term collection at a price of 1,000 yuan in 10 years. In the first quarter, the sales revenue of medium and high-end liquor was 1.725 billion yuan, a year-on-year increase of 3.31%. At the same time, the Tuopai brand has been renewed and upgraded, and Tuopai special T68 and other tuyere products continue to increase in volume. The two ends of the product structure have made efforts to promote the development of Shede Liquor Industry to improve quality and efficiency.
From the perspective of production and research, with the goal of "producing the ultimate product", we will continue to deepen the leadership of scientific and technological innovation, and promote the integration of production and research of the industry-university-research platform by employing chief scientists, cultivating scientific research talents in a stepwise manner, and continuing to build a high-level scientific research team, so as to provide solid technical support for product quality improvement.
From the perspective of channel structure, Shede Liquor adheres to the "3+6+4" strategy of old liquor, through continuous investment in the construction of channels, and adheres to the principle of "stabilizing prices, controlling inventory, and strengthening sales", and in the first quarter, Shede Liquor continued to make breakthroughs in the provincial base market, with sales revenue of 542 million yuan, a year-on-year increase of 12.22%. In addition, 140 new distributors were added in the first quarter compared with the end of 2023, showing that the value recognition of Shede old liquor by distributors has increased year by year.
From the perspective of the market situation, Shede Liquor has increased the expansion of markets outside the province in the strategy of "focusing on Sichuan, Hebei, Shandong, Henan, upgrading the northeast and northwest, and breaking through East and South China", further consolidating the national layout, and actively promoting the expansion of overseas markets.
In addition, Shede Liquor is committed to the dissemination of old liquor, realizes mutual promotion of quality and sales with cultural empowerment, and strengthens the first brand image of Chinese cultural old liquor through high-highlight cultural events and in-depth cultural IP content. In the first quarter of this year, Shede Liquor joined hands with CCTV's New Year's drama "The Years of the Great River", with the ratings breaking 3 for 8 times; A series of high-potential energy communication not only vigorously enhances the brand value, but also achieves the good effect of mutual promotion and mutual growth of product sales.
Under the right direction of the old liquor strategy, Shede Liquor Industry has deeply cultivated quality and channels, created a brand path of "old liquor + culture", and achieved "stability" through "progress" in product structure and development quality, and believed that its high-quality development path will be more stable and far-reaching in the future.