A few days ago, "the first share of bread" Taoli Bread Co., Ltd. (hereinafter referred to as "Taoli Bread") released its 2021 annual performance report.
The report shows that Taoli Bread’s revenue was 6.335 billion yuan, a year-on-year increase of 6.24%, and the net profit attributable to shareholders of listed companies was 763 million yuan, a year-on-year decrease of 13.54%.
It is worth noting that this is also the first drop in net profit of Taoli Bread in the past 10 years.
■ Increase income but not profit
According to Flush iFinD, the revenue growth rate of Taoli Bread has maintained single digits for the second consecutive year, with growth rates of 5.66% and 6.24% in 2020 and 2021, respectively.
During the period from 2012 to 2019, the company has always maintained a double-digit revenue growth rate.
At the same time, the net profit decline this time is the company's first net profit decline since 2012.
From the perspective of operating costs, Taoli Bread will reach 4.67 billion yuan in 2021, a year-on-year increase of 11.84%, and the gross profit margin will decrease by 3.69% year-on-year.
According to the data, Taoli Bread was listed on the Shanghai Stock Exchange in 2015 and became the "first stock of bread".
The company has been focusing on the production and sales of bakery products centered on bread and pastries. The company's main product is "Tao Li" brand bread. During the four-year period from its listing in 2015 to 2019, the company's bread and pastry sales revenue and gross profit margin The proportion is about 98%, and it is firmly in the top spot in the domestic short-term bakery market.
Regarding the main reasons for the current decline in profits, Taoli Bread said in its financial report that there are three main reasons: first, due to the impact of the national phased social security reduction and exemption policy in the same period last year, the company’s labor costs were lower than this period; second, due to the current period Due to the increase in sales promotion in the period, the discount rate was higher than that of the same period last year; third, the production cost increased due to the increase in the price of raw materials.
However, according to Bao Yuezhong, a new retail expert, the decline in the net profit of Taoli Bread is inseparable from the influence of its channel model.
Relevant information shows that peach and plum bread is mainly sold through direct sales and distribution. Large chain supermarkets (KA customers) and small and medium supermarkets and convenience store terminals in central cities are the main sales channels.
Bao Yuezhong said that due to the impact of the epidemic, the performance of the entire supermarket system declined significantly last year, and the revenue growth rate and net profit of Taoli Bread were naturally affected.
In addition, the Beijing Evening News "Food and Beverage Weekly" noted that in the current bakery industry, especially the short-term bakery market, competition is fierce and the phenomenon of homogeneity is serious.
Old rivals such as Bimbo, Yamazaki Bread, Dali Foods, and Panpan Foods are already standing on the track. For example, Dali Foods Group launched a new brand of short-term bread, Meibechen Bread, in October 2018.
According to Flush iFinD, Meibechen achieved a revenue of 614 million yuan in the first half of 2021, a year-on-year increase of 52.4%, and achieved rapid development. It has grown into a large single product with a revenue of more than 1 billion yuan in three years.
In addition, there is also constant pressure from new opponents such as the three squirrels and Xiaobai's soft heart.
In addition, with the improvement of consumption level, more and more consumers pursue freshness and choose high-end chain bakeries that are made and sold.
In this regard, Bao Yuezhong believes that with the upgrading of consumption, bread products will show an upward trend in the consumer market, so it will attract more new participants and create more new industry models.
For competition in the baking field, the most important thing is that with the further segmentation of the market, companies need to reposition their target customers, redefine consumption scenarios, and then adjust their marketing models.
If companies can make more innovations in the above-mentioned areas, they will be able to take the lead in the market; while traditional companies will face great market pressure in the future if their brand positioning and user positioning are unclear.
■ Uneven development
It is worth noting that the current unbalanced development of peach and plum bread is still prominent.
From the perspective of regional development data, the Northeast market is the most important sales market for peach and plum bread, with operating income reaching 2.88 billion yuan in 2021, ranking first; followed by North China and East China, with 1.46 billion yuan and 1.45 billion yuan respectively. However, the revenue of Central China, Southwest China, Northwest China and South China is not more than 1 billion yuan, the regional development is unbalanced, and the pattern of "strong north and weak south" still cannot be changed.
From the perspective of operating income growth, the Northeast and North China markets, the annual growth rate of operating income is 2.82% and 2.34%, respectively. As the most important revenue battlefield, revenue growth is close to saturation, and it seems to have touched the ceiling.
Regarding regional development issues, Bao Yuezhong believes that the main reason is that on the one hand, it comes from the inside of the enterprise, mainly because the demand for talents in the process of nationalization of the enterprise has further increased. Taoli Bread is a family business, and there may be certain limitations in the design of the talent model; Regarding the market environment, it is mainly due to differences in the market and the impact of external environmental issues. For example, southern sweets and northern salty products, the northern may be more accustomed to traditional varieties, while the southern may prefer some western-style products, etc.
In addition, the differences in the competitive environment of each region, such as the existence of industry first entrants, will also have a certain impact.
In response to the above questions, a reporter from the Beijing Evening News' Food and Beverage Weekly contacted Taoli Bread for the first time, but the other party has not responded as of press time.
It is not difficult to see that although peach and plum bread currently occupies a certain advantage in the entire short-term bread baking market, in the face of the new consumer market and as competition intensifies, if it wants to further expand its market share, it also needs to innovate in products and diversify its layout. In addition, the acceleration of the nationalization process has become more urgent.
Sankei Weekly In-depth Report Team