Feihe was soldiers

@新 新 新

Author 丨 Bai Yan Editor 丨 Moon See

There are many concepts of "Mao", but there are not many money to make money like Moutai.

As of the second quarter of this year, Moutai's gross profit margin was 92.11%. In the field of milk powder, the gross profit margin of "Milk Powder" Feihe has long maintained more than 70%. It is also a super brand in the consumer industry. Mengniu and Illi, which are the main liquid milk, only have about 35%.

This is due to the product structure mainly based on high -end infant milk powder. According to the 2021 annual report, the gross profit margin of Feihe infant formula milk powder is 72.4%, while the relevant business accounts for 94.4%of revenue. Among them, Xingfei Fan contributed 50%of Feihe's revenue, which is the "half life" of Feihe.

However, as of the second quarter of this year, the gross profit margin of Feihe fell to 67.58%, mainly due to the control of channel inventory and reducing milk powder products to the factory. Correspondingly, Feihe's revenue in the first half of the year decreased by 16.2%year -on -year, and the net profit attributable to the parent company decreased by 39.7%year -on -year. On September 6, Feihe announced that the group repurchased 1 million shares, totaling 5.8808 million Hong Kong dollars, which further showed the pressure of Feihe's market value management.

This is the decisive time of high -end infant milk powder. Some market views believe that the situation of Feihe is similar to Master Kang in 2016 -to achieve "Nirvana Rebirth" after channel reform; but the difficult channel reform also exposes the weakness of Feihe to competitors.

Yili has a trick, Feihe has no tricks

What did Feihe's channel reform change?

According to the profit early warning issued by Feihe on July 22, it provides consumers with a better product experience and the current situation of the decline in the birth rate of the mainland market, and the channels of Feihe implemented a fresh strategy in 2022 to further reduce the channels of products such as Star Flyfli and other products. Inventory, maintain higher freshness of shelf products, and implement stricter control on the overall inventory level of the distribution channel.

According to the official statement, the purpose of fresh strategy is to make the freshness of channel inventory products higher. The specific method is to reduce shipments in the factory, and sales terminals are preferred to clean up inventory. A maternal and infant shop practitioner said that the fresh strategy of Feihe requested the production date of the store milk powder to be controlled within 3 months. At the cost, the income of the Xingfei Fan series milk powder declined significantly in the first half of the year.

But from the perspective of the industry background, channel reforms are the result of the rolling of the industry. To put it plainly, the product can't be sold, the brand will not stop, and there will be more and more channels for mines.

Since 2016, my country ’s birth rate has fallen rapidly; at the same time, the head milk powder brands are fighting for the market share, and they do n’t hesitate to fight price wars and press the channels to the channel. The head milk powder brand faces a two -choice choice -either continues to "vigorously produce miracles" to accelerate shipments and pressures, but end prices are chaotic, high -end brand positioning collapses; , But the performance plummeted.

And Feihe's approach is good. The advantage is that it strengthens the control of the terminal shelf and reduces the pressure of channel sales. The brand's product date is more excellent in the terminal of the terminal, which is conducive to maintaining the image of high -end product. The disadvantage is that the "short pain" of swallowing the sudden drop in performance. At the same time, the channel share is squeezed by other brands. Press.

Take Yili as an example. In the first half of the year, Yili milk powder products revenue of 12.07 billion yuan, an increase of 58.28%year -on -year. If the impact of the Australian excellence in the first half of the year is excluded, this growth rate is as high as 30%. At the same time, the growth rate of Yili's sales cost in the first half of the year was as high as 18.25%, while the growth rate of operating income was only 12.31%at the same time. This also shows that Yili is paving the way for the emerging products represented by milk powder.

Song Liang, an analyst in the dairy industry, believes that Yili milk powder is in a period of market expansion, and most of its growth is derived from channel expansion. That is to say, the goods are put into the hands of the channel, and the specific selling is yet to be observed.

It is worth noting that the Elijin leading crown has adopted a imitation strategy for Feihexing Feifan. On the product Slogan, Feihe is "more suitable for Chinese babies' constitution", and the golden collar crown is "super formula better understanding Chinese babies"; "Golden Time" before the Spring Festival Gala in 2021, Yilin collar, Feihe Zhenzi and Junle Bao Youcai is the only "gold master" in the infant formula's formula milk powder industry; Focus Media has disclosed that Feihe has been put into high density through high -density of the ladder media for five consecutive years. The Golden Ling Guan is also vigorously putting on elevator advertisements and offline promotion; in addition, some maternal and infant store practitioners revealed that the Elijin collar crown seeks to be next to the shelf display.

In contrast, in the context of a sharp decline in performance, the sales and distribution costs in the first half of the year decreased by only 5.8%year -on -year, and the official interpretation was a reduction in promotional activities. However, in the first half of the year, Feihe organized about 500,000 promotion activities, including the mother's love seminar, carnival and roadshow. Considering the impact of the epidemic on large offline activities, Feihe's "sip" only increased only without decrease Essence

This means that, in the context of slowing down shipments and no longer occupying the funds of dealers and chain maternal and baby stores, Feihe still dare not significantly reduce marketing budgets because the opponents behind them will compete for market share.

Who takes flying cranes?

Lean Youbin, Chairman of Feihe, had a emotional journey of entrepreneurship: "Feihe has made adventure decisions. Once there is no failure, there is no room for resting."

The success of the success of Feihe decided not to succeed in the development and product power, but the marketing gene. In 2001, Leng Youbin independently created Feihe from Wandashan Group to build Feihe. Feihe's milk powder was handed over to foundries to produce. Feihe sent quality inspectors to ensure the quality of the product. In addition, all Feihe people were concentrated in the sales department. Essence Since then, he has stepped on the era of the era many times, allowing Feihe to sit step by step to sit on the position of stabilizing infant milk powder. As an example, after the 2008 melamine crisis in 2008, the infant milk powder market in domestic first and second -tier cities was crowded by imported brands. Feihe chose to focus on the low -line city market. In contrast, foreign brands lack the distribution network in low -line cities, while Feihe's marketing bombing strategy, coupled Middle and high -end positioning lacks cognition, and mainly depends on pricing to judge product quality. This allows Feihe to quickly gain a foothold in the sinking market.

This is the market foundation under Leng Youbin's "famous saying". In an interview with Sina, Leng Youbin once said that consumers think that the good is expensive. Feihe also has less than 200 yuan, but consumers do not buy it.

Similarly, there are channel dividends. Before 2011, the head milk powder brand relied on the traditional channel represented by Shang Chao, and Feihe had realized the transformation of the mother and baby store channels earlier among domestic milk powder brands. Nielsen data shows that the mother and infant shop quickly replaced merchants to become the mainstream channels for infant milk powder. From 2011 to 2020, the proportion of maternal and baby store channels increased from 33%to 69%. At the same time, the proportion of supermarket channels from 44 %Drop to 10%.

Whether it is market dividend or channel dividends, in the final analysis, it is "security dividends".

2008 is an important watershed in China's dairy industry. Prior to this, infant milk powder was just a type of ordinary consumer goods, and high -end products lacked the foundation of consumption. Feihe once promoted the way to buy milk powder to send Northeast rice. After the crisis, in addition to buying milk powder, consumers also spend more amounts and time to buy a sense of security.

Among them, consumers in high -level cities obtain a sense of security by pouring imported milk powder, and consumer consumers in the market have turned to brands that have not been exposed to products that contain melamine, and they are willing to pay more premiums to make up for the sense of security. At this critical point point, Feihe completed the research and development of super high -end product Xing Feifan, laying the foundation for the brand's take -off.

The change of channels is the same. One important reason for the mother and baby store channels to replace the traditional business super. With the upgrading of consumption and product upgrade, consumers tend to solve the consumer and baby consumption needs from professional channels. However, the sense of security plays the role of catalyst. The mother -to -child shop that sinks the market benefits from the trust relationship of acquaintance society. The reason for a large number of Baoma to choose the mother and baby shop is "there is a mother to teach me to buy", "Buy Bao Mom around Bao Mom around me The same milk powder ", which relieves consumers' safety anxiety.

A mother -in -law told "new entropy" that although she can judge the authenticity of milk powder through the scanning traceable source code, she is still used to buying in the mother and baby shop instead of e -commerce channels because e -commerce cannot see the real thing and is worried about buying fakes. goods.

The key moat of Feihe is a sense of security represented by marketing activities, not R & D and product power.

Feihe's channel layout reflects this. Compared with foreign brands and other domestic brands, Feihe has a strict and highly flat channel network. The brand has established a single -level channel relationship with a large number of maternal and baby store brands, which guarantees the strong negotiation position of the Feihe brand and maintains the deployment Brand. When the milk powder is difficult to sell, and when Junlebao falls into the sharp fluctuation of the terminal price chaos, the Feihe is relatively small. The stable terminal price can effectively maintain the sense of security of consumers.

Feihe's corporate cost structure also reflects this. In the first half of this year, Feihe's sales cost was 3.142 billion yuan, and the sales fee rate was 32.48%. The 2021 annual report showed that its R & D expenses were 426 million yuan, and the research and development cost rate was 1.87.87 %.

To some extent, Feihe is a security brand with milk powder as a carrier.

Can Feihe win the next ten years?

In the announcement, Feihe made a clear plan for this year's annual performance -the first half of the year's performance fell slightly under the fresh strategy, and the second half of the year returned to the right track, and the performance greatly recovered. Judging from the top brand of Feihe in the infant formula milk powder market, the group is basically capable of recovering after pain.

The bigger question is how Feihe faces competitors. As Junlebao, Yili and other brands have formed a competitive pattern similar to Feihe in products, channels, and marketing strategies, and Feihe faces the pressure of the end of the market dividend period.

For example, in 2015, Feihe determined the brand positioning of "more suitable for Chinese babies" by introducing the brand cooperation of Junzhi Consultation, and thus opened a period of high -speed growth in the brand. However, this position is more suitable for competition with foreign brands. In the past, the success of Feihe originated from its products, channels, and marketing strategies to bring a sense of security to consumers. As domestic brands poured into the high -end infant formula milk powder market, everyone "understands Chinese babies", where is the differentiated characteristics of Feihe? Feihe's executive team has not given the answer yet.

At the same time, the market environment faced by Feihe has undergone fundamental changes, and the industry is accelerating entering the knockout stage. Previously, the revenue growth rate of head milk powder brands was generally faster than the overall growth rate of the market, indicating that small and medium -sized brands were being eliminated. In recent years, head brands have generally fallen into price melee and slowing in revenue, which means that the "buffer zone" between giants has disappeared, and big brands have begun to fight each other, leaving fewer and fewer market gaps in Feihe. If it is observed from a longer time dimension, the rise of domestic high -end infant milk powder is a deformed result and exceeds the law of the normal consumption upgrade of the market. For example, adult milk powder consumed by students and the elderly, its high -end construction is far less mature as infant milk powder. Although Feihe has achieved a high market success in high -priced+fierce marketing, with the increasingly fierce competition in the price of head brands, the price of infant milk powder will be an inevitable trend.

In addition, Feihe's second curve is unclear.

At present, Feihe's clearer second curve is a full age milk powder. Specifically, the four -stage milk powder consumed by children aged 3 to 6, as well as adult milk powder mainly facing the elderly, and goat milk powder and other products.

But in the new battlefield, Feihe no longer enjoys brand dividends. As mentioned earlier, Feihe can rise rapidly and become a super brand of the milk powder industry. The core is to insight into the security appeal of the domestic milk powder market. Attributes, consumers are willing to pay a higher premium to buy a sense of security, which provides a market foundation for Feihe's ultra -high profit margins. After being separated from the basic market, what support brand premiums did Feihe take?

In addition, although the overall growth rate of the new track is higher, the inner volume is also serious.

Taking goat milk powder as an example, in March of this year, Yili acquired 18.38%of Australian Youyou's shares. The total shareholding accounted for 52.7%of Australian Youyou's issued shares, becoming the largest shareholder of Australia. Australian Young's high -end goat milk powder products will be merged into the Yili system. At the end of last year, Junlebao Baby Milk Milk Powder Zhenwei passed the approval of the General Administration of Market Supervision and Administration, and used the original milk powder channel to fully expand. The giant's entry means that the competition of the new track will intensify.

In Leng Youbin's view, Feihe's goal is not only the domestic milk powder leader, but also hopes to enter the international market and become an international brand that compares Nestlé. But before going to sea, Feihe needs to throw away the "shadow" of the domestic market.

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