China Food

Say milk powder is not good dry? Listen to the flying crane executives talk about where this growth comes from

In order to win 30% of the infant milk powder market share in 2023, we will accelerate the gallop. Yes, the flying crane.


昨天,在上半年业绩出炉后,飞鹤董事长冷友斌等高管于出席了分析师电话会议,并谈到了超高端新品计划、外资奶粉竞争、渠道库存情况、下半年增长预期等。下面,请看小食代发回的现场消息。

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Super high end “war”

Looking through Feihe’s interim report, we can see that the Northeast dairy enterprise with more than 5600 employees achieved 8.707 billion yuan of business revenue in the first half of the year, up 47.8% year-on-year, and realized a net profit of 763 million yuan, up 105.3% year-on-year. At present, the market value of flying crane is HK $142 billion.


对于飞鹤的增长,冷友斌在分析时提到了两个原因,他认为首先,在国内庞大的人口数量和二孩政策支撑下,婴配粉市场仍保持巨大活力。其次,飞鹤对国内疫情形势做出快速反应,降低疫情影响。例如,该公司在疫情期间将消费者教育活动从线下转移到线上,如微信社群互动、线上直播等,“疫情期间,线上活动量超过了线下重启的活动”。

However, the overall situation of the milk powder industry is hard to say. According to Euromonitor, a market research company, the growth rate of China’s milk powder industry (including baby food) has declined to about 10% and gradually stabilized, compared with 20% in 2013. In such a stable market, to win the stock competition of milk powder industry, we must “eat” a higher market share.


蔡方良表示,飞鹤针对线上电商渠道开展了精准的用户运营及运营绩效管理的工作。在上半年,电商渠道收入为11亿元,在该公司收入的占比由去年同期的7.1%提高至12.6%。

(Financial Summary of the first half of 2017-2019, Feihe official website)

Offline, when the epidemic situation stabilized, Feihe said that from the end of March to the beginning of April, offline face-to-face activities would gradually resume. Cai Fangliang said at the meeting that in the first half of this year, there were more than 330000 online and offline activities, and it is expected that the number of activities in the whole year will exceed 700000. After a simple calculation, it means up to 1900 activities a day on average. Of course, we have to return to the products eventually: positioning the super high-end star flying sail and Zhenzhi organic as the main growth engine. According to CAI Fangliang, President of Feihe, super high-end products accounted for more than 60% of Feihe’s revenue in the first half of the year, compared with 51.4% in the same period last year.


Subsequently, Cai Fangliang introduced the specific growth of the main product, xingfeifan, in the reply.

According to reports, the growth rates of the first, second and third stages of xingfeifan were 45%, 63% and 55% respectively in the first half of the year, while the growth rate of the fourth stage products was as high as 666%. The flying crane executives who attended the meeting disclosed that in the sales of xingfeifan, the proportion of products from the first stage to the fourth stage was 22%, 21%, 45% and 12% respectively.

Thanks to the help of super high-end products, Feihe has won many “No.1” markets. According to the company in the first half of the year, Feihe ranked first in the market participants of China’s infant formula milk powder with 13.9% market share, and became the first market participant of China’s super high end infant formula milk powder with a market share of 25.5%

It is worth noting that in order to keep high-end “ammunition reserves”, flying crane will also launch “more high-end” milk powder than star flying sail. According to CAI Fangliang, the company plans to launch a new infant milk powder product in the second quarter of next year, and describes the new product as “the most advanced infant formula milk powder of Feihe” after its launch, which is a “beneficial supplement” to the high-end products of Feihe.


据介绍,飞鹤明年还将推出完成配方升级的臻稚有机、超高端婴幼儿羊奶粉新品、以及由加拿大工厂生产的高端成人奶粉。该工厂目前处于试生产的阶段。

Whose cheese has moved?

At the meeting, flying crane senior management disclosed that the company has achieved growth in many provincial markets. In addition to harvesting the share of some small brand milk powder, it even covets the “territory” of some powerful peers.

Cai Fangliang said that the 14 provinces of Feihe, Yunnan, Guizhou, Guangxi, Hubei, Hainan, Fujian, Jiangxi, Sichuan, Guangdong, Chongqing, Anhui, Zhejiang, Shaanxi and Hunan achieved high growth offline. Among the high-speed growth provinces and regions mentioned above, Yunnan (up 150% in the first half of the year), Hunan (50%) and Guangdong (70%) will continue to make efforts.

Liu Hua, chief financial officer of Feihe, pointed out that in the Hunan market, Feihe should be very close to Aoyou in the local market. In the first half of the year, Aoyou, a dairy giant headquartered in Hunan Province, achieved an income of 3.859 billion yuan, a year-on-year increase of 22.6%.

He predicted that based on the current growth momentum, Feihe is expected to surpass other brands in Hunan in the fourth quarter of this year, and to surpass other brands in Guangdong next year. In response to how Feihe achieved growth far higher than the average level of the industry, Cai Fangliang said that on the one hand, some small brands could not provide consumer services after the outbreak of the epidemic, “so we have seized the market share of some small brands.”. On the other hand, in the online cities greatly affected by the epidemic situation, due to its “strong service ability and rapid response to the impact of the epidemic”, it has also seized a lot of foreign investment shares.

Check the performance of foreign leading milk powder, it seems that they have encountered some problems of their own. Nestle said the decline in Wyeth’s milk powder sales slowed in the second quarter, while CEO Schneider said he was still committed to improving its milk powder business in China to achieve its goal. As for Danone, its CFO said that sales of mother and baby stores in China rose by about 50% in the second quarter, but milk powder sales were affected by factors such as the closure of ports in Hong Kong and travel restrictions on the epidemic.

Xiaoshidai has introduced that Feihe said in the annual report of 2019 that it will accelerate its penetration into first tier cities, and its strategy is “point to area”, that is, concentrate resources into key terminals, so as to expand the volume and consumer groups. At the meeting, Liu said that flying crane will continue to implement this “steady” strategy.

So what is the current inventory turnover of Feihe after the first quarter of “milk powder hoarding” by dealers and consumers? It is reported that in the first half of the year, the inventory turnover days of Feihe were 58 days, down 6 days.

“In fact, the problem of high channel inventory level should be in March and April. At present, there is no problem. ” Cai Fangliang said frankly that after Feihe took the lead in finding problems in the industry, it has carried out strict control since late March, and held additional market activities since April, and strictly controlled the purchase of dealers. “By June and July, this problem has been completely alleviated. Because our own performance has far exceeded expectations, there is no need to do this kind of channel bulk cargo action. ” He said. It is reported that the channel inventory in the second quarter has returned to the level within two months.

Cai Fangliang also said that due to the great pressure on terminal business after the epidemic, xingfeifan was also facing “unprecedented” price pressure. However, since the special management of flying crane began in April, the overall situation is controllable, and only a few areas have pressure. “In the future, with the increasing size of starsail, we will have major actions in the fourth quarter of this year and the first quarter of next year for how to ensure the health (Development) of starsail.” Cai Fangliang said.

Add new capacity

At the meeting, he also learned about the latest development of the flying crane Canada factory. According to CAI Fangliang, the above-mentioned factories are currently in trial production stage, and will be mainly responsible for the production of super high-end infant milk powder, with an annual production capacity of 40000 tons. He also revealed that according to the plan, Feihe will launch three super high-end infant milk powder series produced by Canadian factories in 2022, including two milk powder series and one sheep milk powder series.

The company is expected to achieve double digit growth with Huanhe in half a year. “Last year, we mentioned to investors in the roadshow that our expectation is that the market share of infant milk powder in China will not be less than 30% by 2023. Now we are very confident.” Cai Fangliang said.

In order to support the realization of the above goals, Feihe has made a large investment in the upstream and downstream industrial clusters. In terms of the upstream pasture, xiaoshidai introduced that this year, Feihe invested 1.2 billion yuan in Longjiang County and Tailai County to build two 10000 head dairy farms, and the construction has started at present. In terms of downstream factories, Feihe said in the financial report that it was building a new Harbin plant and expanding the Longjiang plant. According to the Qiqihar daily news, after the delivery, the Feihe dairy (Longjiang) infant milk processing project with a total investment of 550 million yuan will become the largest single infant formula milk powder production line in China.

A kind of

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