Chinanews client, Beijing, August 26 (Zuo Yukun) China is a delicious country. It is reasonable to pronounce the word "good" as three tones or four tones.

  Even during the epidemic, everyone was able to transfer the consumption scene of "eating" to home, and successfully led to a substantial increase in the demand for condiment household channels. However, in the post-epidemic era, the condiment industry is also experiencing growing pains.

Condiments sold in the supermarket.

Photo by Zuo Yukun, China News Service

"The biggest vinegar jar" reported a thunderstorm

  Hengshun Vinegar Industry was the first to be recognized by the industry as the "exploding performance".

Hengshun balsamic vinegar, which was founded in 1840, is currently the only vinegar listed company. However, the "century-old brand" has encountered big troubles this year.

  On August 23, Hengshun Vinegar Industry’s 2021 semi-annual report showed that during the reporting period, revenue was 1.035 billion, an increase of 8.59% year-on-year; the net profit attributable to shareholders of listed companies fell 14.62% year-on-year to only 127 million. The profit level also pulled Hengshun back to 2018.

  Hengshun Vinegar Industry explained that the decline in gross profit margin was mainly due to fluctuations in raw material prices.

The main raw material of the company’s commercial vinegar is glutinous rice, which accounts for more than 30% of the company’s production costs.

  For Hengshun's "increasing revenue but not profit", some insiders believe that it is also affected by the sudden emergence of community group buying.

Companies have fought price wars in order to compete for the market and business, which impacted the price system of traditional consumer goods and affected their profitability.

  However, the Minsheng Securities Research Report predicts that the price impact of community group buying on some products of Hengshun Vinegar Industry will not last for a long time. As the disposal of other business assets of Hengshun Vinegar Industry is nearing completion, the disturbance of non-recurring gains and losses on the profit side will gradually weaken.

The picture shows the vinegar craftsman looking at the dried vinegar in the vinegar jar.

Photo by Li Yang

The "Three Brothers of Soy Sauce" Group Tumbled

  The vinegar business is bleak, and the life of soy sauce is not easy.

  On August 18, Qianhe Flavour Industry released its semi-annual report, after which the stock ushered in a one-word limit, and it plummeted by 25% in three trading days.

Starting from the highest point of 42.67 yuan in early February, Qianhe Weiye, which was once regarded as the star of hope in the soy sauce industry, had its share price dropped to 18.85 yuan as of the close of the market on August 25, which had been cut in half a year.

  In this financial report that caused the stock price to plummet, Qianhe Flavor's revenue in the first half of the year was 886 million yuan, a year-on-year increase of 10.82%; net profit was 65,812,800 yuan, a year-on-year decrease of 58.09%; gross profit margin also fell from 49.73% in the same period last year to 42.2 %.

  Qianhe Weiye attributed the reason to the substantial increase in promotion and advertising expenses, and at the same time the impact of the increase in raw material prices: due to the increase in raw material prices, operating costs increased by 27.39% year-on-year, and the increase in promotional and advertising costs led to a year-on-year increase of 38.35 in sales expenses. %, R&D costs also increased by 31.91% year-on-year.

  Some investors believe that it is an indisputable fact that the price of soybeans and other raw materials for soy sauce products has risen, and the increase in research and development costs is justified. However, Qianhe Weiye's heavy investment in TV advertising has become the main reason for this performance explosion.

In the first half of the year, Qianhe Flavour Industry spent 98 million yuan in advertising on Jiangsu Satellite TV.

The picture shows workers canning the prepared soy sauce.

Photo by Wang Dongming

  Haitian Weiye and Zhongju High-tech, both of which are the "three brothers of soy sauce", have not yet disclosed their semi-annual reports, but they have also suffered severe setbacks since the beginning of this year.

Since the beginning of this year, Zhongju High-tech's stock price has plummeted by more than 50%.

  In addition, as of the close on August 25, the total market value of Haitian Flavor Industry was 460.4 billion yuan.

In the same period last year, the market value of Haitian Flavour Industry was 534.8 billion yuan, and it "killed the Quartet" in A-shares-surpassing the home appliance leader Midea Group, the pharmaceutical leader Hengrui Pharmaceuticals, and even the oil giant Sinopec.

Subdivision and upgrade, the track is still optimistic

  According to statistics from the China Condiment Association, most of the top 100 condiment companies last year had sales revenue of less than 2 billion yuan, 75% of the companies had sales growth in the range of -20% to 20%, and 32 companies showed negative growth.

  But it is precisely this seasoning industry that seems to be entering the cold winter, and new trends have been frequently reported recently.

  The most eye-catching thing is the crossover between the two big meat giants.

Shuanghui said on the interactive platform that the company is currently strengthening the development and promotion of condiments, and has successfully launched hot pot ingredients series, noodle ingredients series, bone soup series, spicy beef sauce and other meat sauce series, barbecue special seasonings, cold sauces, etc. A series of compound condiments.

  Longda Meat announced the signing of a strategic cooperation agreement with the Sichuan Hot Pot Association, which will focus on the research and development of Sichuan-style seasonings and Sichuan-style prepared dishes.

Compound condiments sold in supermarkets.

Photo by Zuo Yukun, China News Service

  At the same time, the baby food brand "Little Deer Lantern" under Three Squirrels has launched a children's soy sauce. In the product introduction, "organic salt reduction" is regarded as a selling point, which is considered to enrich its product line and is expected to bring new profit points. Initiative.

  The official announcement of several major brands to enter the condiment industry also implies the trend of the condiment industry. Although a single condiment is already a market with a high degree of brand concentration and a more mature pattern, it is more suitable for product upgrades and shelf innovations based on consumer demand. The "composite condiments" cooked by young people and the subdivision "upgraded condiments" in line with health trends still have room for development.

  According to iiMedia Consulting's data, my country's condiment market has reached 395 billion yuan in 2020, which is more than 1.5 times larger than in 2019. The market size is expected to exceed 400 billion yuan in 2021.

Condiments that capture subtle taste changes on the tip of the tongue, and want to capture consumers in the 400 billion large market, must have enough "strong strength" and "strong heart."

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