Yang Menghan, chief reporter of "Huaxia Wine News".
According to the 2023 annual report, Shanxi Fenjiu achieved operating income of 31.928 billion yuan, a year-on-year increase of 21.8%, and net profit attributable to listed companies of 10.438 billion yuan, a year-on-year increase of 28.93%.
According to the revenue changes in the past three years, the scale of Fenjiu has doubled, which is like reengineering. So, where does this "reinvention work" come from? and how does Fenjiu maintain long-term competitive potential?
Fenjiu speed, 3 years up to 128%
Fenjiu has become the fourth listed liquor company in the industry with an annual revenue of more than 30 billion yuan, which not only represents its own growth, but also represents a change in the ranking and growth logic of the industry!
On the list of listed liquor companies, the gap between Fenjiu and the top three is narrowing, which means that its current state is infinitely close to the goal of "entering the first camp of the industry" previously formulated.
At present, among the listed liquor companies, only Kweichow Moutai, Wuliangye, Yanghe, Shanxi Fenjiu, and Luzhou Laojiao have annual revenues exceeding the 30 billion mark.
If you go back to the past, it only took one year for Fenjiu to develop from an annual revenue of 20 billion yuan to an annual revenue of 30 billion yuan.
In 2021, Shanxi Fenjiu achieved operating income of 19.971 billion yuan, a year-on-year increase of 42.75%, and net profit of 7.029 billion yuan, a year-on-year increase of 65.99%. This year, there is only a thin line between Fenjiu and 20 billion.
In 2022, Shanxi Fenjiu achieved an operating income of 26.214 billion yuan, a year-on-year increase of 31.26%, and a net profit of 8.096 billion yuan, a year-on-year increase of 52.36%. In other words, Fenjiu will only exceed 20 billion in 2022, and it will only take 1 year to break through 30 billion from 20 billion.
From 10 billion to more than 20 billion, it took only 3 years - its revenue was as high as 11.8 billion yuan in 2019, and it will exceed 20 billion yuan in 2022, only 3 years.
Even after 2020, when the industry was greatly affected by the epidemic, Fenjiu still responded strongly and continued to develop rapidly.
In April 2021, at the "Fenjiu Distributors Conference", Fenjiu clearly put forward the development goal of becoming the first camp of the industry by the end of the "14th Five-Year Plan", and in January 2022, Yuan Qingmao, the new chairman of Fenjiu, clarified the strategic development goal of entering the first camp at the end of the "14th Five-Year Plan", and defined the next three years as "Fenjiu's major strategic development period".
In the three years from 2020 to 2023, Fenjiu's revenue has increased by about 17.9 billion yuan, which is equivalent to rebuilding a first-line famous liquor company, with an increase of about 128%. Based on the compound growth rate of total operating income in the past three years, it is 31.66%, which is also far ahead in the industry.
You must know that during the same period, there has been a major differentiation in the liquor industry, and many local liquor companies have been unable to grow, struggling under the situation of great changes in consumption and reduced demand. Even some famous wine companies are facing great pressure from high inventories on the road to high growth.
So, why can Fenjiu maintain a very high growth rate in such a differentiated situation, and what has created the rapid development potential of Fenjiu?
Three potential energies create an unparalleled "Fenjiu phenomenon"
In the industry, the rapid growth of Fenjiu is crowned with the term "Fenjiu phenomenon", which shows that its growth rate is high and unique.
"Only by seeing the 'three potential energies' of famous liquor, fragrance potential energy, and Fenjiu potential energy can we grasp the basic principle of the sustainable growth of Fenjiu. Yuan Qingmao, Secretary of the Party Committee and Chairman of Fenjiu Group, clearly pointed out the key to the rapid growth of Fenjiu.
In response to Yuan Qingmao's point, experts in the industry also made a clear interpretation.
"The potential energy of famous wine represents a round of general growth of famous wine enterprises, and after 2016, famous wine companies have passed the last round of industry cycle and entered the stage of recovery growth. Ma Fei, an expert in the wine industry and chairman of Jiudu Consulting, believes that represented by Moutai, famous wine companies have generally shown a high-growth development trend after 2016, which shows that consumers have begun to shift from local brands to first-line brands in terms of alcohol choice.
In the general growth of famous wine enterprises, there is also a diversion - the growth rate of individual enterprises is much higher than the overall growth rate of famous wine enterprises.
"This lies in the company's own motivation and brand power. Ma Fei believes that this is also the origin of the potential energy of Fenjiu. During the epidemic, there was a certain degree of differentiation among famous wine companies, and Fenjiu seized this opportunity to face the difficulties and show a stronger adaptability.
From the perspective of the general program of rejuvenation formulated by Fenjiu itself, the period from 2022 to 2024 is the period of development transformation and management upgrading of Fenjiu's revival, that is, the first stage, which shows a trend of rapid growth, and the second stage, from 2025 to 2030, is the period of consolidation of achievements and factor adjustment of Fenjiu's revival.
The fragrance potential energy is the third potential energy that Fenjiu can utilize.
"In the era of consumers' pursuit of differentiation and personalization, consumer demand has pushed the industry into a period of category and personalized development. "Industry experts believe that from the hot sauce to the hot fragrance, it is an obvious performance.
As the pioneer and leader of the fragrance category, Fenjiu can naturally borrow the potential energy of this category to the greatest extent.
The superposition of triple potential energy has created an unparalleled growth rate of Fenjiu.
Compared with it, other companies may only have "famous liquor potential energy" to borrow, or can only superimpose brand potential energy, and can integrate the three into one, at present, only Fenjiu, which is an important reason why Fenjiu can maintain a high growth rate in the past three years and be rebuilt.
Comprehensively upgrade and maintain long-term development momentum
In the past 6 years, Fenjiu has not only achieved a breakthrough of 10 billion, but also made persistent efforts, breaking through the ladder of 20 billion and 30 billion in a short period of time, and realizing the qualitative change of enterprise scale and competitive potential energy with a very high compound growth rate.
So, will this high growth of Fenjiu continue, and how to maintain long-term development in the future? This has become an important issue that the industry is extremely concerned about.
In this regard, it is clear that the enterprise side also has a clear understanding. According to the official statement of Fenjiu, the development in 2024 will be guided by the business policy of "gathering potential energy, marketing breakthroughs to increase efficiency, cultural guidance, brand upgrading to promote development, production capacity improvement, strengthening roots and building quality, management upgrading, digital intelligence empowerment and cohesion", scientifically and reasonably determine the main indicators in 2024, and strive to increase operating income by about 20% compared with the previous year.
"Gathering potential energy", which shows that the company will continue to leverage the potential energy of famous wines, fragrance potential energy, and Fenjiu potential energy to form a development trend of rolling forward and making breakthroughs.
Industry insiders believe that the potential energy of famous liquor has become a long-term potential energy for the development of the industry, and under the condition that it is more difficult to build a new brand and it is difficult to surpass the new category in the short term, the potential energy of fragrance and Fenjiu will continue to continue, which is the development potential energy that Fenjiu can borrow for a long time.
In terms of marketing, the nationalization of Fenjiu will be further improved.
In 2023, the revenue of Fenjiu in the provincial market will be 12.084 billion yuan, a year-on-year increase of 20.41%, and the revenue in the market outside the province will be 19.659 billion yuan, a year-on-year increase of 22.84%. The proportion of the market outside the province has reached 66.11%, the 1 billion market continues to increase, and the core market south of the Yangtze River has increased by more than 30% year-on-year.
In contrast, six years ago, the market outside the province accounted for only 40%, which undoubtedly means that its degree of nationalization is increasing year by year.
In 2023, through the improvement of the linkage mechanism of the three major brands of Fenjiu, Zhuyeqing and Xinghuacun, a complementary and mutually promoting development trend has been formed.
In terms of production capacity, Fenjiu will promote the "Fenjiu 2030 Technical Transformation Original Liquor Production Energy Storage Expansion Project (Phase I)" in 2022, with an investment of up to 9.1 billion yuan, the project covers an area of 1,932 acres, and the construction period is planned to be three years. After the completion of the project, the company is expected to add an annual output of 51,000 tons of raw liquor and 134,400 tons of raw liquor energy storage.
In 2020, Fenjiu invested in a "health wine expansion project" with a project amount of 2.4 billion yuan. This means that not only for liquor, but also for the "Zhuyeqing" brand, Fenjiu has also expanded its production capacity.
By 2025, these capacity expansion projects are expected to be fully implemented, and at that time, Fenjiu will obtain great capacity guarantee and lay an extremely strong material foundation for subsequent sales growth.
Coupled with the upgrading of production and management based on digital intelligence, this means that Fenjiu will continue to maintain innovation and momentum, with an average annual growth rate of more than 20%, to become the first camp at the end of the "14th Five-Year Plan" and achieve the strategic goal of "one in three parts of the world", providing inexhaustible growth potential.