2018 food and beverage juice industry depth report! High-end changes brought about by health needs

Investment Summary
The overall growth of fruit juice is weak, and structural upgrading has become a new growth point.
From a horizontal comparison, the output of the fruit juice industry in the soft drink industry has the lowest year-on-year growth rate, and the industry experienced negative growth in 2013. The main reason is that great changes have taken place on the demand side, and low-end fruit juice, which occupies a large share, is no longer favored. In 2016, China's fruit juice market experienced a decline in sales and sales. Low-concentration fruit juice sales and sales continued to decline in recent years, the performance of medium fruit juice is close to the overall fruit juice, the increase in price reduction sales growth rate further slowed down, pure fruit because of its high nutritional value, small consumption base, in recent years showed a trend of rising volume and price, become the direction of fruit juice consumption upgrade. As our topic said, the demand for health to bring high-end demand, pure juice growth space is vast.
NFC is at the top of the nutrition level and has great potential for development.
Compared with FC juice, NFC juice has shorter heating time and less nutrient loss during processing, and better maintains the original taste of fresh fruits. NFC has a short shelf life and generally requires cold chain transportation and low temperature storage. With the continuous upgrading of the consumption level of residents in the future, as well as the gradual improvement of cold chain transportation, warehousing, and other supporting services in big cities, NFC juice, as a real "pure natural freshly squeezed juice", better meets the healthy and fresh consumption trend, The future development prospects will be broader. In 2016, China's NFC juice sales were less than 100, 6% of the juice industry's sales scale, and the per capita consumption was less than 0.013L. The market is still in the early stage of development. We believe that a company with a reasonable marketing strategy, high product quality, unique production process, perfect cold chain and effective cost reduction is an ideal investment target.
Tianyi Sammy, the future star of NFC industry
Tianyi Senmei was established in the 1990 s. Its original main business was frozen concentrated juice and related products. Its NFC products were officially listed in 2015, accounting for 2.8 of the total revenue, and soared to 25.5 in 2016. The development of the company is in line with the market trend and has many advantages, such as publicity, packaging in place, product quality assurance, unique production process, perfect cold chain system, cost control in place and so on.
Huiyuan juice, products continue to upgrade to create industry opportunities.
25 years of history to build a strong brand power, the company in China's pure fruit market and fruit market share ranked first. The company's revenue structure has been continuously optimized, the proportion of pure juice has increased by more than 10% in 7 years, and the company's gross margin has continued to rise. Continuous product innovation is the foundation of Huiyuan's survival, upgrading in concentration, taste and packaging to meet the changing needs of different types of consumers and maintain competitive vitality.
Earnings Forecasts and Ratings of Key Industry Companies
1 Low-end juice flooded with industry saturation, 2018 juice industry to open a new chapter
During the ten years from 2001 to 2010, China's beverage market has maintained double-digit growth and has become one of the fastest growing consumer industries. However, in the past five years, the output growth rate of the fruit juice industry in the soft drink industry was the lowest compared with the same period last year, and negative growth began to appear in 2013. In 2016, the sales volume and sales volume of China's fruit juice market declined. Fruit juice market sales fell 3% in 15 years and 5% in 16 years. Benefiting from the increase in average price, the decline in fruit juice sales was later than the decline in production and sales, and the degree of decline was less than the change in volume. Juice sales still grew 3% in '15, but began to reverse by 1% in '16. Until 2017, this situation has not been reversed. The main reason is that the proportion of low-end juice is too large and the ship is difficult to turn around. However, after two years of exploration, we expect the industry to turn around in 2018.
The reasons for this dilemma in the juice market are both macroeconomic factors and the industry's own shortcomings. We conclude that the main reasons are the following five points:
First, in the past two years, the overall growth rate of China's economy has slowed down (GDP growth rate was 6.9 in 2015, lower than 7.0 for the first time), the growth of beverage market sales has slowed down significantly (Nielsen data show that the overall sales volume of the beverage industry increased by 9.1 in 2012, while it was only 6.9 in 2013), and the overall demand of the soft drink industry has been negative for a long time (ranging from 1-3% per year in the past nine years);
Second, with the gradual diversification of consumption, new beverage varieties emerge in endlessly, and the market of new varieties such as vitamin drinks and light drinks is growing rapidly, seizing part of the market, on the other hand, the fruit juice industry itself has the defect of insufficient product innovation, and there are no star products that particularly attract consumers in recent years;
Third, intensified competition in the industry and rising raw material costs have led to a reduction in the gross profit margin of the juice beverage industry and a deterioration in the living environment of enterprises;
Fourth, in recent years, there have been many food safety problems in fruit juice drinks, which have affected consumers' desire to buy;
Fifth, the product structure of juice drinks is unreasonable. Nielsen data shows that health factors have become the second largest consumer concern after taste, and the product structure of the juice industry is mainly low-and medium-concentration juice beverages that do not meet the development trend, and 100 that meet the nutritional and health needs of consumers.% Juice accounts for a serious shortage.
Based on the above reasons, we believe that the current juice industry needs a new product with nutrition and health as the entry point, conforms to the general trend of market development, meets the growing demand of consumers for the health and safety of drinking products, injects fresh blood into the industry, improves the competitiveness of the industry, and drives the overall growth of the juice industry.
2 Compared with the three major categories of juice, 100% pure juice drive is the core driving factor of the future industry.
Juice can be divided into three levels according to concentration. Low-concentration fruit juice beverage refers to fruit juice with a concentration of no more than 25%, which is mainly competitive with taste and price, but has low nutritional value. Fruit juice with a content of 26%-99% is medium-concentration fruit juice, many of which better retain pulp, fruit fiber and pectin, etc. Fruit juice with low nutritional value is improved. 100% fruit juice is high concentration fruit juice, or pure fruit juice, with the highest nutritional value. Pure fruit juice can be further divided into low temperature pure fruit and normal temperature pure fruit, or FC (concentrated reduced juice) and NFC (non concentrated reduction). Combined with the reasons for the overall weak development of the juice industry pointed out earlier, we believe that high-concentration juice may become a new growth point driving the industry.
2.1 low fruit: the largest volume, sales and sales double decline is the inevitable trend of development
Low-concentration fruit juice is the largest sector in China's fruit juice industry, accounting for more than 70%, and this proportion is actually completely contrary to developed countries, in developed countries such as Europe and the United States pure fruit juice constitutes more than 60% of the fruit juice industry. The situation in China is caused by the economic constraints of developing countries themselves. It can be seen that with the increase in China's per capita consumption and the increase in per capita income in recent years, the trend of consumption upgrading is clearly reflected in the juice industry, with low fruit sales and sales. The volume continues to decline, and the share of shares decreases accordingly.
On the one hand, the shrinkage of low fruit comes from the impact of the awakening of consumer health awareness on the market. In the past, many people thought that drinking orange was drinking juice, but now if you look at the label and ingredient list, you will find that the nutritional value is very low. In addition, the impact comes from the non-fruit juice market. Drinking low fruit is more for the sake of refreshing taste. This demand can be replaced by carbonated drinks, subdivided light drinks and herbal tea, so the competition in the low fruit market will become more and more cruel.
The consumption of low fruit is basically reflected in summer, mainly in store channels and convenience store channels. From a city-by-city perspective, low-fruit is also a shrinking situation across the board. Low-fruit market sales and sales share are declining, especially in key cities with high consumption levels. In 2016, there were not many really favorable new products in the low-fruit market. Generally speaking, the low-fruit market has been relatively bleak in the past three years.
2.2 Mid-Fruit: Growth in markdowns slows further
The trend is largely similar to that of the overall juice market, which has been slowing for the past three years. Zhongguo sales continued to decline, but the average price has been rising, which is finally reflected in a certain increase in sales, but the growth rate has slowed down. Growth was 3.8 percent in 2015 and 1.8 percent in 2016.
At present, the proportion of medium fruits is relatively large, at 15%-20%, for two reasons. First, there are some categories of Chinese fruit that cannot be made into pure fruit juice, such as hawthorn and strawberry. Second, the medium fruit is a transitional market from low fruit to pure fruit. The consumption upgrade cannot expect people who did not drink fruit juice or low fruit to directly consume pure fruit in one step. The transition of the medium fruit market is needed.
In terms of market distribution at all levels, the distribution of medium-term fruits is more even, with key cities accounting for the smallest proportion, but with the fastest growth, reaching 13.2 per cent in 2016. From the taste point of view, Chinese people prefer mixed tastes. Zhongguo has a natural advantage in this respect. It can add some sugar and essence flavoring agents, which is more suitable to mix fruits with bad taste alone to make a product. Medium fruit consumption is more inclined to medium and large packages (low fruit small, medium and large relative balance), because the medium fruit consumer group is relatively sensitive to price, so medium and large packages have an advantage. Generally speaking, Zhongguo is a transitional market, and the future development direction of China's fruit juice market is pure fruit juice with higher nutritional value, or high concentration fruit juice.
2.3 pure fruit: volume and price rise, driving the healthy development of the industry
At present, pure fruit accounts for the smallest proportion of the juice market, but its nutritional value is the highest, gross profit margin is the highest, and average price is the highest. Benefiting from the upgrading of consumption and the awakening of public health awareness, the pure fruit market shows a trend of rising volume and price. In 2016, the average price of pure fruit rose 4.1 per cent, sales rose 9.8 per cent and total sales rose 14.3 per cent. According to Nielsen, comparing the changes in the drivers of low, medium and pure fruit sales, it is clear that pure fruit is the direction of the juice market.
After distinguishing low temperature from normal temperature, the growth rate of low temperature is faster than that of normal temperature, but the proportion is relatively low, about 40%. The low temperature is mainly expanded by milk. Only after milk can juice spread out cold chain juice through the same channel. Now, the low temperature is limited by channels. In 1., the development of second-tier cities is relatively fast. In 3., fourth-tier cities and villages and towns, it is difficult to achieve it because there is no full low-temperature supply chain. With the improvement of the overall supply chain, the restrictions on low-temperature juice will be less and less. For normal temperature juice, it does not have any restrictions, whether in the township or in the first-tier cities can be carried out.
From the taste point of view, orange juice is the largest category (the same is true for the sub-market in the north and south), and the overall taste is relatively concentrated. There are some differences in taste between the north and the south. The consumption of apples, peaches and pears in the north market is very large, of which peaches account for a higher proportion. The sales volume of peach juice in Henan and Hebei regions is second only to orange juice, and the growth rate of coconut juice in the south is very fast. Although pure fruit also has some mixed flavors, such as pomegranate, passion fruit, pineapple, etc., but the proportion is relatively low.
From the packaging point of view, the normal temperature pure fruit is mainly in large bags (accounting for 67.4), because the consumption scene of normal temperature pure fruit juice is mainly restaurants, families and aviation. Low-temperature pure juice is mainly in small packages (75.8 percent), emphasizing portability, and is mainly sold in convenience stores and vending machines. From the perspective of consumption areas, pure fruit is mainly concentrated in key cities and provincial capitals, which are 1. second-tier markets. Among them, low-temperature pure fruit juice is more obvious, which is basically consumed in first-tier cities. Normal-temperature pure fruit juice is more uniform, because it is less restricted by channels. From the perspective of consumption channels, among the major channels, hypermarkets are the development direction of juice, and convenience stores are the fastest growing channel. Its growth rate is mainly related to the younger consumer population. Low-temperature prices and logistics factors make it easy to sell low-temperature juices. The hypermarket used to be the largest and faster, but it has shrunk. Now the shrinkage has slowed down, and the overall volume is still the largest plate.
Pure fruit is the growth point of the juice industry in the future, and the market share has a broad space for improvement. Specifically, there are three reasons. First, considering the improvement of consumption ability and the popularity of healthy consumption concept, from the perspective of demand, 100 pure fruit juice will further meet the requirements of consumers for nutrition, health and pure natural food and beverage. In this respect, low concentration fruit juice will not catch up. According to the analysis of the Economic Intelligence Group, by 2030, the proportion of low-income people (disposable income <13000 yuan) in China will drop to 11%, and the people's spending power will be greatly improved. Nielsen surveys show that the middle class is growing in most emerging and developing countries. 72% of Chinese respondents said their financial situation is better now than it was five years ago.
Second, from the perspective of market share, at present, the main businesses of major domestic juice production and sales companies are low-concentration juice, and the industry concentration is relatively saturated. The market share of leading enterprises in the industry, led by Coca-Cola (China), Weiquan and Beijing Huiyuan, is more than 10%: Coca-Cola (China) is 14.6, Weiquan is 11.6, and Beijing Huiyuan is 11.0. The "industry ceiling" or has been reached. However, the 100 per cent pure juice market, especially the NFC market, has relatively moderate competition and great potential for future growth.
Third, this judgment can also be confirmed by comparing the fruit juice market structure with other developed countries. We select Japan, a developed country with similar eating habits and consumption concepts in China, to compare the proportion of various concentrations of fruit juice consumption in the Japanese market as a predictor of the proportion of consumption after China's future entry into developed countries. According to Euromonitor, Japan consumed 59.13 per cent of 100 per cent of fruit juice last year, compared with 5.2 per cent in China, which means that under this assumption, China's 100 per cent fruit juice market will have more than 10 times the growth space in the future. However, low-concentration juice drinks (78.6 per cent), which account for the vast majority of the Chinese market, are only 28.13 per cent in Japan, supporting the possible impact of economic growth on the market share of low-concentration juice drinks.
3 NFC is at a higher nutritional level in pure fruit and is the highest manifestation of fruit standardization.
3.1 100% pure fruit juice is divided into FC fruit juice and FG fruit juice. The essential difference between the two lies in the concept of "concentrated reduction"
NFC juice refers to the fresh original fruit directly squeezed out of juice after washing, directly canned after instant sterilization (without concentration and recovery), processed in a low temperature environment, without concentration and water reduction, completely retaining the original fresh flavor of the fruit. The FC fruit juice is in the fruit is squeezed into the original juice and then the use of low-temperature vacuum concentration method, evaporates a part of the water, and then in the concentrated fruit juice raw materials with the same amount of natural water lost in the concentration process, made with the original fruit pulp color, flavor and soluble solids content of the products. This difference in production process determines the differences in raw material selection, transportation and storage methods, price and taste, nutrition level and audience.
Compared with FC juice, NFC juice has shorter heating time during processing, less nutrient loss, and better maintains the original taste of fresh fruit. Therefore, NFC juice has a short shelf life (generally about 20-40 days, while FC juice is usually more than one year), which has the need of cold chain transportation and low temperature storage, and also has higher requirements for vegetable and fruit raw materials to ensure better taste. This makes the cost of NFC juice among the highest in the juice category, and the main audience is also a higher consumption level group that focuses on taste and nutritional health. With the continuous upgrading of the consumption level of residents in the future, as well as the gradual improvement of cold chain transportation, warehousing, and other supporting services in big cities, NFC juice, as a real "pure natural freshly squeezed juice", better meets the healthy and fresh consumption trend, The future development prospects will be broader.
At the same time, China's NFC juice market is in the early stage of the industry outbreak and has strong growth potential. In 2016, China's NFC juice sales were less than 100, 6% of the juice industry's sales scale, and the per capita consumption was less than 0.013L. The market is still in the early stage of development. However, neighboring Japan's NFC juice consumption accounts for more than 70% of the 100 fruit juice industry sales, and the per capita consumption exceeds 2.5L. In addition, the per capita consumption of NFC juice in the United States has reached 10L, far exceeding the level of our country. Visible China NFC market growth space is huge.
The 3.2 NFC juice industry has stricter requirements on the marketing strategy of enterprises, and enterprises with reasonable marketing strategy have stronger competitive advantages.
From 2011 to 2015, the sales volume of FC juice in China is in line with an average annual growth rate of 9.6, while that of NFC juice is 6.4, because NFC is only a minority, and the total sales volume of 100 pure juice is 9.5, which is close to that of FC juice. On the one hand, because FC juice has a more people-friendly price, it has a certain competitive relationship with NFC juice; on the other hand, it is also a manifestation of consumers' lack of consumption habits and brand awareness of NFC juice. Therefore, enterprises that can have reasonable marketing strategies in advertising, consumer terminal construction and packaging, and can fully educate consumers in the market, can better adapt to the requirements of future NFC market competition.
3.2.1 Internationalization of industry quality management standards, and enterprises whose quality meets or leads industry standards have more competitive advantages.
In 2015, the national standard for freshly squeezed juice was promulgated, stipulating that "fruits are raw materials, unfermented, unconcentrated juice products directly made by mechanical methods, and raw juice made by non-heat treatment processing or pasteurization can be called Freshly squeezed juice". Therefore, of the 100 per cent of fruit juice products, only NFC fruit juice meets the "fresh juice" industry standard, so this provision is a positive factor for NFC fruit juice manufacturers that meet industry quality standards. At the same time, the industry quality management standards are gradually connected with the international community, which is conducive to standardizing the order of market competition and resisting shoddy fraud. Therefore, NFC juice enterprises whose quality meets or leads the industry standards will have more competitive advantages in the future.
3.2.2 The industry has high requirements for product taste, and enterprises with unique production processes and perfect cold chain systems have more competitive advantages.
NFC juice is mainly delicious without adding original ecology, so its core competitive advantage is high quality. The raw material of NFC juice comes from the world's high-quality fruit and vegetable producing areas, and special processing technology is needed to reduce nutrient loss in the processing process. At the same time, because it is low temperature sterilization, NFC from production to sales to the whole process of refrigeration. This requires an experienced cold chain system management team to manage the production process. But now China's NFC industry is in the early stage of development, many enterprises are difficult to meet the relevant requirements. Therefore, enterprises with stable supply of high-quality raw materials, unique production technology, perfect cold chain system and an experienced cold chain system management team will have great competitive advantages in the future.
3.2.3 At present, the price of industrial products is relatively high, and enterprises that can effectively reduce costs and have accurate positioning for consumers have more competitive advantages.
NFC juice due to the high quality of fruit, production, preservation requirements are high, so the price is higher. From the survey of market prices, the price of NFC juice is about 2 times that of FC juice. On the one hand, although the price of NFC products is high, the cost is also high, so the gross profit margin is lower than that of FC juice. Judging from the gross profit margin of Huiyuan Juice and Tianyi Senmei Group, the two major enterprises in China's high-concentration fruit juice market, before 2014, the gross profit of Tianyi Senmei Company, which mainly produces high-concentration fruit pulp, was higher than Huiyuan, which mainly sells medium-and low-concentration fruit juice, indicating that the profit of FC fruit juice was higher than that of medium-and low-concentration fruit juice. In 2015, Sammy's gross profit was lower than Huiyuan's, because Sammy introduced NFC juice and the production cost increased. In mid -2017, Sammy's gross profit was lower than Huiyuan's again, mainly because the market price of fresh orange, the main raw material of NFC, increased. Although Huiyuan also introduced a series of fresh fruit presses, it still sold mainly FC and low concentration, indicating that the cost of NFC is much higher than FC.
The source of high cost is mainly the input of high-quality raw materials. Therefore, NFC companies need to seek different ways to control raw material costs, such as by establishing their own orchards to reduce the impact of market prices on raw material costs. On the other hand, because the overall purchasing power of our people is not high enough, the high price of products is doomed to the enterprise in the distribution process can not flood, but need to have a precise positioning of high-end customers. To sum up, it can not only effectively reduce costs under the premise of ensuring product quality, but also accurately locate customers in first-tier cities with high overall consumption levels and high-income crowds, and enterprises with complete distribution systems in first-tier cities will have greater competitive advantages in the future.
4 days overflow Sammy: focus on NFC,2C end product exposure continues to improve
4.1 product structure transformation and upgrading, new product market potential is huge
Tianyi Senmei was established in the 1990 s. Its original main business was frozen concentrated juice and related products. The company made the decision to enter the NFC juice market in 2014, and its NFC products were officially launched in 2015. According to Tianyi Senmei's 2016 annual report, NFC sales rose from 13.29 million yuan in 2015 to 0.148 billion yuan in 2016, and NFC juice accounted for 25.5 percent of the company's total revenue from 2.8 percent in 2015. In 2017, NFC sales were 0.134 billion yuan, accounting for 22.3 of the company's total revenue, down from 2016. The company's overall sales in 2017 also showed a slight decline, mainly due to the rectification of existing sales channels, sales promotion and sales strategies this year. In the last quarter of 2017, Sammy launched smart vending machine sales for NFC target consumer groups. Sammy NFC further deepened market penetration and laid a solid foundation for stable sales in the future.
2016 is the second year of the listing of Tianyi Sammy NFC. With the increase of marketing and promotion of Tianyi Sammy and the expansion of China's NFC market, the sales volume of Tianyi Sammy NFC products has great growth potential and can bring continuous growth revenue to Tianyi Sammy.
The 4.2 market is well-founded, and the NFC industry needs all parties to expand together.
Total revenue rose 23.5 percent in 2016 compared to 2015, corporate gross margin rose to 41.3 percent from 36.1 percent in 2015, and total revenue rose 3.78 percent in 2017 compared to 2016, with total revenue growing steadily for three consecutive years. In 2017, the company continued to upgrade and transform its strategy, and used NFC as a new driving force for the group's business growth. The gross profit margin decreased by 15% in 2017, due to the large increase in the market price of fresh oranges used for processing and fresh sales in 2017. The cost input brought by the high-end product structure is temporary, and the increase in scale effect in the future will bring huge marginal increment.
The company's profit in 2016 dropped from 0.106 billion yuan to 0.085 billion yuan compared with 2015. On the one hand, there was a one-time income of about 23.34 million yuan in 2015 due to early redemption of convertible bonds, resulting in a high income in 2015. On the other hand, Tianyi Senmei actively carried out marketing and promotion in 2016, and sales and distribution expenses (including trial drinking, activity expenses and transportation expenses) rose to 98.54 million yuan from 20.73 million yuan in 2015. The operating profit in 2017 increased from 0.084 billion yuan to 0.109 billion yuan compared with 2016. The main reason is that Sammy adjusted its marketing strategy and tried its best to control the market expenses. Sales and distribution expenses decreased significantly, from 98.54 million yuan in 2016 to 84.05 million yuan.
In 2016, Tianyi Sammy established 1885 sales outlets and plans to establish another 4000 sales outlets by the end of 2016. Considering that Tianyi Sammy is in the initial stage of market expansion, the expenditure for this part is reasonable. In 2017, although NFC is in a period of consolidation, Sammy is actively adjusting its sales and promotion strategy. In addition to the previous promotion method of trial drinking, Sammy has also invested resources in mass media publicity to further deepen public recognition of Sammy NFC, but sales and distribution expenses have gradually begun to decrease.
4.3 the company's procurement costs can be controlled, channel sales structure is constantly refined.
The main sales and purchases of Tianyi Senmei are mainly denominated in RMB, and most transactions are settled in the functional currency of the Group's business (Hong Kong dollars or RMB), and there is no significant risk due to changes in foreign currency exchange rates. Half of Tianyi Senmei's oranges come from her own orchard and half from farms around her own orchard.
NFC is highly dependent on raw materials. Once natural disasters or bad weather occur, the production of NFC will be seriously affected. In addition, Tianyi Senmei is now enjoying national and local preferential policies (such as tax breaks), and changes in local policies may also have a certain impact on its finances. In response, Senmei has established orchards in multiple provinces to decentralize and weaken the impact of climate and policy changes on business.
The price of NFC juice is high, and companies need to find reasonable ways to control, stabilize costs and accurately position high-end consumers. In terms of cost, the sky overflows Sammy to master the upstream orange garden. The company owns 146000 mu of orchards and operates 76000 mu of orange orchards and 70000 mu of orange orchards under construction in Chongqing. It is one of the few juice enterprises that own orange orchards. Owned orchards can control the price of raw materials, from the market orange price fluctuations. On the other hand, the quality assurance of the original orange is also in line with the consumer demand for "nutrition and health.
At present, NFC juice is still in the initial stage of development, the competitive environment is relatively relaxed, and the development potential is huge. Compared with other market participants (importers, small brands, new entrants, other big brands), the company has a greater competitive advantage.
Compared with importers, Tianyi Senmei has the advantages of taxation, cost and distribution brought about by localization. In terms of tax revenue, imported brands are subject to 37% of the tariff. In contrast, Tianyi Senmei is supported by the government and 25% of the income tax is exempted because it is in line with the three rural policies. In terms of cost, it takes more than a month for imported brands to enter the domestic market, which not only reduces the freshness of orange juice, but also involves more logistics costs. In terms of distribution, the relationship between overseas brands and distributors is weak, resulting in weak promotion momentum on the retail side.
At the same time, Tianyi Senmei NFC Juice has pre-emptively established upstream supply, unique production process, cold chain logistics system, international food safety standards and other competitive advantages, forming competitive barriers, ahead of the domestic industry. Compared with small brands, Tianyi Senmei has absolute advantages in taste, food safety, cold chain transportation system, upstream expansion and sales channels. Compared with new entrants, Tianyi Senmei has formed a higher competitive barrier. As far as upstream supply is concerned, the orange tree fruiting cycle takes 5 to 7 years, which is difficult to develop in a short time; as far as the cold chain logistics system is concerned, the self-built system requires a large amount of capital investment; as far as food safety is concerned, the juice plant of Tianyi Senmei has passed SGF certification, which is more secure. It can be seen that the entry threshold of NFC juice is high, and it is difficult for new entrants to develop a large scale in a short time. Compared with other big brands, many big brand juice is currently focused on FC juice. If you want to enter the NFC juice industry, there will be strategic conflicts and you need to re-layout.
5 Huiyuan Juice: pure fruit market leader, constantly power NFC
5.1 revenue structure upgrade, gross margin continues to improve
Huiyuan Juice was established in 1992 and listed in Hong Kong in February 2007. It is one of the few juice manufacturers in China that has formed a complete industrial chain layout of upstream and downstream. The company's revenue is divided into four segments, 100 per cent fruit juice, medium-strength fruit juice, fruit juice beverages (I. e., low-strength fruit juice) and others. The company's 100 per cent juice share of revenue continued to increase, from 22.56 per cent in 2009 to 35.15 per cent in 2016, making it the company's largest source of revenue. At the same time, the proportion of medium and low fruits continued to decline, by 20% and 10%, respectively. The proportion of other products has increased, mainly including water and other beverage products.
Segmented products, 100 percent juice has the highest nutritional value, the highest price, and the highest gross margin, and the increase in the proportion of pure juice revenue means the optimization and upgrading of Huiyuan juice revenue structure. Benefiting from the optimization of income structure, the success of de-production capacity (remediation of idle capacity, opportunistic sale of redundant capacity) and the implementation of lean production (minimizing production time, eliminating all waste and reducing inventory), Huiyuan Juice's overall operating efficiency and profit level continue to improve, which is reflected in the statement that gross profit margin continues to rise.
5.2 vertical integration of industrial chain, strategic layout of production base
Huiyuan is a fruit juice brand integrating upstream processing and downstream production and sales, ensuring the quality and stable supply of raw materials, flexibility in the development of new products, and the ability to resist risks to fruit price fluctuations, as well as reducing the impact of price fluctuations of fruit pulp and concentrated fruit juice on profitability. Upstream fruit processing plants are located in various fruit producing areas, from the surrounding fruit farmers, cooperatives to buy fruit, reduce the need for transportation and logistics, upstream and downstream merger of the vertical industrial chain can ensure the stability of raw materials, price fluctuations are easy to control. This makes Huiyuan occupy a certain geographical advantage and operating advantage, to a certain extent, the formation of industry entry barriers.
Huiyuan has 40 production bases, including 12 upstream fruit processing and packaging bases and 28 downstream filling bases. Huiyuan's strategic production base layout comprehensively guarantees product quality and food safety. The upstream fruit processing plant is located in the surrounding area of the orchard, occupying a geographical advantage to ensure good product quality. Downstream packaging equipment throughout China, effectively reducing logistics costs and raising the industry threshold.
In addition, Huiyuan also has advanced production facilities to ensure food safety. Sound, the implementation of the ISO9001, HACCP, ISO22000, OHSAS18000, ISO14001 and other quality, safety, environmental management system, and the implementation of system certification. Production control is strict, and food safety problems have never occurred since its establishment.
5.3 products continue to innovate and maintain competitive vitality
Huiyuan has more than 100 kinds of products, rich product portfolio to provide different price positioning, taste, concentration and packaging design of products for different consumer groups to choose to meet the changing needs of different types of consumers. Huiyuan has upgraded and innovated the old products at three levels. First, in terms of concentration, it has upgraded to high quality, high concentration and high nutrition. Secondly, in terms of taste, it has upgraded to a richer taste level. Finally, in terms of packaging, the design is more fashionable and more suitable for the aesthetics of young people.
Specific examples, such as the U-Mix series, belong to the high-end 100% mixed juice, mixed taste, rich taste, distinct levels; The appearance design is young and fashionable, and the main target group is female consumers aged 18-35. Fresh fruit juice is the first room temperature NFC in China. The most advanced "aseptic cold filling" is adopted in the production process and equipment. The target customers are white-collar workers and other high-end consumer groups, mainly sold in Shandong, Jiangsu and Zhejiang regions.
Huiyuan fruit 100 series belongs to FC products, accounting for 85% of Huiyuan's overall low-temperature product mix, with an annual growth rate of 382 and an average gross profit of more than 45%. The sales channels are hypermarkets, supermarkets, convenience stores, traditional channels, etc. In addition to fresh fruit juice, Huiyuan NFC also has Huiyuan fresh squeezing workshop series, accounting for 15% of Huiyuan's overall low-temperature product mix, with an annual growth rate of 283, an average gross profit of more than 55%, positioning more high-end than fruit 100, and sales channels are high-end supermarkets, hypermarkets, special canals, etc. In addition to pure fruit juice, Huiyuan also provides low-sugar fruit juice drinks, such as new oranges, which are healthier than ordinary fruit juice drinks. The product packaging is eye-catching and bright, in line with the aesthetics of young people, and is mainly sold in supermarkets and campuses.
5.4 channel sales network guanjue juice industry, 2C end is its core competitive advantage
Huiyuan's distribution network is dominated by dealers and direct channels, covering the whole country, with direct channels mainly covering first-tier cities and dealers mainly covering third-tier cities in the 2. Huiyuan has 2000 distributors and 2 million retail stores. It classifies the national integration into different sales regions, manages the distribution strategies of different regions flexibly, and promotes the depth and breadth of product coverage to the greatest extent. Huiyuan is mainly sold in China, with the largest market being Shandong, accounting for 23% of revenue.
Huiyuan has a layout online and offline sales, and offline retail channels cooperate with many well-known supermarkets, including Wal-Mart, RT Mart, Metro and so on. Online penetration of e-commerce channels, e-commerce channels grew rapidly in 2016, with sales increasing by more than 30% year-on-year. The products sold by the company through e-commerce channels are limited to online sales and are specially customized. The selling price will be adjusted according to the platform to attract online shopping consumers. E-commerce channels are expected to maintain a 30% growth rate in the future.
In addition, the company actively explore the international market. In 2014, 1L100% apple juice and orange juice will be sold in Hong Kong to enter Huikang and China Resources convenience stores. Entered in Jizushima in 2015; In 2016, it started strategic cooperation with Yang Xiecheng and established a joint venture in Malaysia. It will officially enter the Southeast Asian market in 2017.
5.5 brand power is an effective moat, NFC power continues to lead the industry.
Huiyuan has 25 years of development experience and has a high brand recognition. Huiyuan takes "younger, high quality, more fashionable" as its core, faces different consumer groups, closely follows the market trend and the needs of consumers, makes the brand image deeply rooted in the hearts of the people, and stabilizes the position of the first brand of fruit and vegetable juice in China.
With its own competitive advantages, Huiyuan has long occupied a leading position in China's fruit juice market and occupied a large market share, especially in the market segment of 100 pure fruit juice and medium concentration fruit juice. the market share calculated by sales volume and sales volume is firmly in the first place. According to Nielsen market research data, in 2016, China's 100 juice market, calculated by sales volume, Huiyuan accounted for 53.4, second place 29.5; in terms of sales, Huiyuan also led in share (44.2). In the medium concentration juice market, Huiyuan's leading advantage is not as good as pure juice, but it is still the first market share.
Huiyuan has been in the NFC market, the new dealers are basically the exclusive agent NFC category, in the original channel penetration of new products, but also in the convenience store channel encryption NFC products distribution efforts, improve product matrix, to undertake the future sales growth point.
Source: Beverage Industry Network, Dongxing Research Institute
[Exhibition Information Recommendation Details]]
Show keywords:
Health products, nutrition products, special medical formula food, Guangzhou health products exhibition, Guangzhou food exhibition, probiotic products, organic food, children's nutrition, maternal and child health food
Exhibition introduction:
The "China Health and Nutrition Expo" (NHNE), sponsored by Sinopharm Reed Exhibition, is the largest professional exhibition of health nutrition and health products in China. Through two exhibitions a year (spring Shanghai, autumn tour), it has gathered tens of thousands of state-approved honest suppliers of blue hat health food and many new products and international health products, providing excellent brand promotion and product channel expansion services for domestic and foreign enterprises.
The 8th China Health and Nutrition Expo will be held on December 4-6, 2018 at the China Import and Export Fair Exhibition Hall (Guangzhou). The exhibition area is expected to exceed 40,000 square meters, bringing together 1000 product suppliers and professional service providers in the field of health and nutrition, as well as 100000 honest distributors, agents and terminal purchasers. It has become the best platform for merchants to find new products, exchange and learn, and master market information.
On December 4-6, 2018, multi brands gathered, Guangzhou held the 18th China International Health Expo and 2018 China (Guangzhou) Health Festival, the 8th China Health and Nutrition Expo, 2018 China Health and Nutrition raw materials/packaging/equipment Exhibition, International Natural Food and Beverage Expo.
Key words: medicine and Health Products Exhibition Health Nutrition Exhibition Health Products Exhibition Pazhou Health Products Exhibition Guangzhou Food Exhibition Guangzhou Health Products Exhibition Guangzhou Food and Health Products Exhibition Health Products Exhibition Health Products Investment Agency Investment Agency Investment Agency Investment Agency Investment Agency Investment Agency Health Products Nutrition and Health Products Exhibition China Health and Nutrition Exhibition Guangzhou Health Products Exhibition Health Products Exhibition Health Products Exhibition Health Products Exhibition Health Products Exhibition Health Products Agency Investment Agency Guangzhou Health Products Exhibition Health Products Exhibition Health Products Exhibition Health Products Exhibition Health Products Exhibition Health Products Exhibition Investment Agency Investment Agency Guangzhou health Exhibition Guangzhou Pazhou Exhibition Guangzhou Health Products Agency Drug and Health Products Exhibition December Guangzhou Health Products Exhibition Guangzhou Health Products Exhibition Health Products Exhibition Health Products Exhibition December Guangzhou Health Products Exhibition Health Products Exhibition Health Products Exhibition Drug Fair Health Products Agency Exhibition NHNE China Health Industry Expo Drug Fair China Health Products Exhibition Guangzhou Drug Fair Drug Fair Health Products Exhibition China Health Products Exhibition