Chapter 1213 – The Current Situation of the Beverage alliance
Feng Yu returned to Shanghai. The Beverage Alliance’s product sales had hit a bottleneck again.
Feng Yu had put in lots of effort to gather all the Chinese beverage manufacturers to form this alliance for exportation of their products and enter the big supermarket chains.
The sales had risen sharply initially, but these companies are not making money. Firstly, their products are produced in China and shipped overseas. Secondly, the marketing cost is too high. The companies had spent a lot on promotions and lucky draws.
As the West’s bottling factories are set up, the transportation cost is lowered, and they also slowed down their advertising. The sales continued to increase slowly, and they started getting profits.
Lehaha, Jianlibao, Huiyuan, Le Bashi, Coconut water, etc., are doing the best. These few companies’ brands are also the most popular.
In Asia, Lehaha, Jianlibao and Coconut Water are the most popular, and in the West, Lehaha, Jianlibao, and Huiyuan, are more accepted by the westerners, and Le Bashi’s sales are the lowest.
Le Bashi had created problems and keep wanting to introduce new products.
When Le Bashi saw Lehaha introduced a soft-drink and suppressed the two Cola giants, they felt they should also produce carbonated drinks.
Le Bashi started to produce their soft-drinks, and it is sweeter than Lehaha’s Refresh drinks. But they made the same mistake as Jianlibao in Feng Yu’s previous life. They started advertising, but their production cannot meet the demand.
The distributors want to order, but Le Bashi cannot fulfill their orders!
The distributors are furious. Why are you all advertising when you all don’t have the goods? Your company has too much money and doesn’t know where to spend?!
So, the distributors in China are angry with Le Bashi. If it wasn’t for Le Bashi to have its own distribution channels in the South, they would have been in the red last year.
When Le Bashi saw Lehaha and Jianlibao introduced tea beverages, they felt it’s just adding tea leaves and water and introducing their own tea beverage.
The last time, Le Bashi had made their drinks too sweet, and this time, they made it too bland. It tastes just like ordinary tea people drink at home.
Your beverage taste like the tea people drink at home. Why would people buy it? Taste is most important for a beverage. People are willing to accept tea beverages, but it must taste like a beverage first!
Le Bashi saw their beverages are not selling well, they started to introduce new dairy product favors.
Le Bashi starts to invent new yogurts. Lehaha had introduced fruit yogurts, so can we. We will introduce high-end yogurt products and sell them higher than Lehaha.
This time, Le Bashi did not make any mistake. But there are several dairy companies in China now. These companies have their own farms, and their dairy products are selling better.
Even Lehaha don’t dare to sell milk, but Le Bashi went ahead and priced it higher than other companies in the market. Without a doubt, they failed again.
After that, Le Bashi decides to go into energy drinks. They worked with Thailand’s Red bull to produce their own sports drink, Mai Dong. Red bull is in cans, and Mai Dong is in a bottle.
Red Bull is very similar to Qi Li Energy drinks, and Mai Dong is selling on its vitamin contents.
In Feng Yu’s previous life, Red Bull had entered the Chinese market much earlier. They did not go into any joint venture with a Chinese company, and Lehaha did not introduce Qi Li. That’s why Red Bull quickly gains a foothold in China.
In this life, Qi Li appeared in the market earlier, and its packaging is blue. Although Red Bull’s can is gold in color and has a blue bull logo, the name makes people feel it is imitating Qi Li.
But Red Bull had a longer history, but the Chinese do not know.
Although the concept of including vitamins in sports drinks is good, the taste is ordinary, and many people cannot feel the effects after drinking it. People felt it is not as refreshing as Qi Li.
That’s right. Qi Li contains caffeine, and how can a drink with vitamins make someone alert?
Le Bashi started moving further away in the wrong direction. They were formerly one of the core companies in the Beverage Alliance. Still, they are on the verge of becoming an outsider now.
Le Bashi cannot win against their compet.i.tors in China, and their overseas sales are not doing well. They even went into joint ventures with other companies, but it did not yield any result.
Xurisheng Group, Zhenzhen, and a few companies also withdrawn from the overseas market to focus on the domestic market. They realized their cost did not lower much if they get the Alliance’s bottling plants to produce their drinks, and they cannot keep up with the marketing. The Westerners also don’t like the taste of their drinks, and it’s better to give up.
These companies’ products are also not doing well in China and should forget about the overseas market. But these companies did something different from Le Bashi. They went to discuss with Zhong Qingxian first. We will not partic.i.p.ate in overseas sales. Still, we will continue to supply some of our products because of the contract. If there’s no problem with the contract, please let us withdraw.
What can Zhong Qingxian say? The other party had approached him with sincerity, and he had been unwilling to let them join in the first place. These products are packaged with Lehaha, Jianlibao, and other companies’ products to enter the overseas supermarket chains. Without them, Lehaha and Jianlibao can display more products.
Zhong Qingxian is not worried about these companies giving up the overseas market to focus on the domestic market. The only beverage company that can compete with Lehaha is Jianlibao. But they are one of their own, and Coconut water is different. This product was served in the State Banquet, and it tastes very good. Le Bashi had also introduced coconut beverage but failed.
Huiyuan is only producing fruit juice, pure fruit juice. Their positioning is different from Lehaha and Jianlibao, and the compet.i.tion is not big. Also, Lehaha had bought a stake in Huiyuan. Although it’s only a minor stake, they are also considered one big family. More importantly, Huiyuan needs a good sales channel, and Lehaha has the most comprehensive sales distribution channel in China.
Xurisheng’s tea beverage sale is only average and is only good in their province. Out of their province, they are nothing.
Jiaduobao, which Feng Yu felt has high potential, is slowly opening up new markets along the coast. They had also given up on the overseas market as the Westerners don’t have the concept of ‘heatiness,’ which is one of their selling points.
Jianlibao is also in talks with Jiaduobao to invest in them. It will be terrific if they can be successful. But it’s a pity that they are not successful in getting a stake in the Coconut Water company.
The two Cola giants, Tong Yi, Kang Shifu, and other beverage companies are still limited to the villages. Their plan of taking over the villages to surrounding the cities is only half successful.
These companies might have high brand awareness in the village markets, but no one likes them as they are not advertising on TV once they enter the city.
These companies rely only on putting up posters on walls around the cities, and it looks low-cla.s.s!
Lehaha and Jianlibao also started to open up the village markets. The two Cola giants failed to penetrate the City markets, and their markets were shrunk further. They regretted choosing Tong Yi and Kang Shifu as partners now.
The two Cola giants still had some brand awareness in the Provincial cities then. But after cooperating with Tong Yi and Kang Shifu, their brand awareness got lowered. In another two years, they might be forced to withdraw from the Chinese market!
Feng Yu had come to Shanghai to discuss with Zhong Qingxian how to further open up the overseas market!
Translator’s notes:
Chinese food therapy