China Food

China’s soy sauce factory built by KFH Heinz has been put into operation! We had a chat with the Asia boss

Kraft Heinz, a multinational food giant with well-known brands such as Weishida, is ready to take an extra share in China’s soy sauce market.

Yesterday afternoon, kraft Heinz announced in an online conference that its Yangxi soy sauce production base in Yangjiang, Guangdong Province was officially put into production. According to reports, the total investment in the project of kraft Heinz Yangxi soy sauce production base is about 700 million yuan, which is one of the largest single investment projects in the world in recent years.

“Yangxi soy sauce production base officially put into production, reiterating Kraft Heinz’s determination to the Chinese market.” Kraft Heinz said it was a modern chemical plant built on the basis of its confidence in China’s business environment and the continued growth of the Chinese sauce and condiment market in the future, and it was also the eighth factory invested and built by itself in China.

In his office in Guangzhou, Mr. xiaoshidai had a further exchange with Rodrigo Wickbold, chairman of kraft Heinz Asia and managing director of China. He talked about the company’s capacity investment, new product planning, competitive strategy and growth goals in the Chinese sauce and condiment market.

Rodrigo Wickbold, chairman of kraft Heinz Asia and managing director of China

Let’s get to know.

New soy sauce factory put into operation

The Yangxi soy sauce production base officially put into production this time is an important investment of kraft Heinz in China. “This is one of the largest monomer plant investments in the world in recent years, and it also proves that we have great confidence in the soy sauce and seasoning market in China.” Rodrigo told the snack generation.

“The launch of the new plant has expanded our production capacity and enabled us to continue to expand our business.” He said.

Kraft Heinz said in a notice released yesterday that the production base is expected to produce 200000 tons of finished soy sauce a year, mainly producing weijixian series soy sauce, a star product of Weishida brand, including 380ml, 760ML and 1.6L. The products are mainly sold to markets in South China and central China.

Kraft Heinz Yangxi soy sauce production base

At present, Weishida’s “home” is in South China. According to Nielsen’s survey in May 2020, Weishida is a delicious soy sauce product with the leading market share in Guangdong and Fujian. Data show that its main selling point is the “one-time extraction” process. It is learned that the traditional soy sauce extraction process needs four times of extraction, and the amino acids and other delicious ingredients in the original sauce will gradually decrease.

“Soy sauce is a $12 billion industry, growing at an annual rate of 8%. Our growth rate is slightly faster than the average growth rate of the industry, so our market share is relatively stable. ” “Right now, we want to speed up significantly, so we need to expand our production capacity, which is why we are building a new factory,” Rodrigo told the company

Rodrigo Wickbold, chairman of kraft Heinz Asia and managing director of China, announced that Yangxi soy sauce production base was officially put into operation

As well as expanding capacity, the company also wants to enhance its ability to innovate.

“We’re not just going to increase production capacity to expand our business regionally, but to further expand our product portfolio and launch new products.” Rodrigo said.

As a company that provides seasoning solutions, kraft Heinz needs more sauce products, and the plant will expand more sauces and condiments in the future, he said. “In terms of Chinese condiments, we will also launch more soy sauce related new products.” He said.

New product “spy”

“Next year, Weishida will have a very important new product launch plan for us, but it is not convenient to disclose it now.” “Next year, we’re going to have a number of new products coming on the market,” Rodrigo told foodies

He said that although it is impossible to reveal what kind of product it is, it can be said that Weishida has seen an obvious trend of high-end. “Chinese consumers are willing to pay more for high-quality sauces and condiments. At the same time, they pay more attention to healthy diet and want to eat better, such as reducing salt, pursuing the origin of ingredients and so on. We have to do something about it and provide innovative products to meet consumer demand. ” He said.

For example, in order to meet consumers’ higher pursuit of food ingredients, Weishida is carrying out research on raw materials. “For example, there are many different kinds of soybeans, not just the traditional ones.” Rodrigo said. In addition, he said, Weishida is still exploring different processing technologies. “Our new factory can also enhance our strength in this area. The equipment of this factory is first-class.”

Kraft Heinz Yangxi soy sauce production base

However, it is not easy for a multinational food giant to innovate Chinese soy sauce.

For example, as more and more Chinese consumers pursue less salt, less sugar and less oil in their diet, kraft Heinz is actively embracing this trend. However, how to help people eat healthier and still enjoy delicious food has always been a research and development challenge.

“If you want to cut down on salt, you may need to have other ingredients to replace salt to provide a delicious flavor, but this supplement is natural and a good alternative.” Rodrigo said.

But Kraft Heinz chose to face the difficulties.

“We are investing heavily in R & D. at the same time, we can also make use of our global R & D strength, because we have seen similar trends (less salt, less sugar, less oil) all over the world. The Chinese market can also learn from our experience and practice in other global markets.” He said.

He said that Chinese cuisine is one of the most complex cuisines in the world, and simply copying the company’s global sauce and seasoning solutions undoubtedly underestimates this complexity. So what Kraft Heinz is doing is developing products with “Chinese flavor” for Chinese consumers in China.

“For a foreign food giant, it is really a great challenge to develop Chinese style sauces and condiments. This is one of the reasons why we have to invest so much in the Chinese market and move our Asian headquarters to China. We hope to have local capabilities and insight while having global scale. ” Rodrigo said.

Although it’s not convenient to disclose it now, he told the snack generation that Kraft Heinz has already reserved some new product solutions for new consumption trends. “In this process, we also use our global R & D resources. For Chinese sauce, experts are here, but in other markets around the world, we can also apply the achievements and practices of salt reduction and other technologies in the research and development of Chinese soy sauce. ” He said.

The secret recipe of competition

At present, China’s sauce and condiment market competition is very fierce, the market concentration is not high.

As of November 2019, the top four companies with market share in China’s sauce and condiment market were Haitian and Zhongju hi tech (its soy sauce brands include “Meiweixian” and “Chubang”), Li Jinji and kafhenshi (its soy sauce brands include “weijixian” and “chunweixian”), accounting for 7% respectively 5%, 5.4%, 3.2% and 2.7%.

When asked about its competitive advantages, Rodrigo said that on the whole, kraft Heinz’s “secret recipe” for winning in China is: first, it is one of the largest sauce and condiment companies in the world, and also one of the largest food companies in the world; second, it has strong brands, including Weishida, Heinz and Guanghe; third, it has strong production capacity to ensure production High quality and food safety.

“We have been in the Chinese market for 36 years and we have the iconic brands in the industry. Weishida is a leading brand of soy sauce in South China, especially in Guangdong and Fujian. Then we also have a great Guanghe brand, I think it has great development potential. In addition, we also have Heinz, which is the world’s leading brand of Western sauce. ” He mentioned.

Rodrigo told the caterers that in terms of sauces and condiments, kraft Heinz’s growth priority in China in the next three to five years is to drive the growth of these three brands.

He said that on the one hand, it is necessary to realize the “significant growth” of Heinz ketchup in the Western sauce market, and on the other hand, it is necessary to realize the significant growth of Weishida in the Chinese soy sauce market through product portfolio expansion, including sauce category expansion. At the same time, we will give full play to Guanghe’s growth potential. “Now we only sell Sufu products. I think there are more possibilities for this brand.”

More SKUs

As mentioned above, in order to better accelerate growth, kraft Heinz is planning to significantly expand its sauce and seasoning portfolio.

As for the category of Chinese sauces, Rodrigo told the food agency that the ideal product mix has not yet been achieved. “Our existing products allow us to grow slightly ahead of the market, but to accelerate growth, we need to significantly increase our portfolio. We’re doing it. ” He said.

“Now, Weishida has 38 SKUs, among which delicious is the largest product series. In the future, we need about 100 SKUs to win the market. ” Rodrigo told the snack generation.

Official data show that in 1983, Weishida launched a delicious soy sauce. At present, Weishida soy sauce core product line includes: weijixian series soy sauce, pure delicious soy sauce, Maoxiang fresh soy sauce, super grade soy sauce and so on.

In addition, he mentioned that in terms of regional expansion, Weishida has developed very well in Guangdong and Fujian, and can further expand its advantages. With the expansion of its product portfolio, Weishida can also start to expand its business in other provinces and cities.

“For Weishida, our goal is definitely to achieve double-digit growth (about 15% – 19%) He said.

Rodrigo also sees opportunities to further expand its product portfolio in China in terms of Western sauces and condiments.

“For example, Heinz has more than 8000 different ketchup products in the world, but in China we have only three ketchup products. So, you can imagine our opportunity to expand our portfolio here. Of course, I’m not saying that we will introduce thousands of tomato sauces into the Chinese market overnight, but we can gradually increase our product selection diversity. ” He said.

From the ambitious plan to the present time, the snack generation understands that this year’s epidemic has also had a great impact on the business of kraft Heinz sauce and condiment. However, as you can expect, the two major businesses of catering service and retail channel can be said to be “hot and cold”.

“Our catering business has been hit by the closure of restaurants during the outbreak, but now the catering channels are gradually recovering. But on the other hand, because consumers are cooking and eating more at home, our retail business is growing very well. ” Rodrigo told the snack generation.

As a result, the company now faces two challenges, he said. First, how to get its catering service business back on track in the post epidemic period. Second, how to maintain the growth of retail channels.

“In the catering channel, we need to do a lot of work on our product mix and deepen our relationship with our customers. We expect the business to return to last year’s level around the fourth quarter of this year. ” Rodrigo said.

As for the retail channel, he said, it is mainly relying on innovative products. “From the second half of the year, we will launch one after another to let consumers enjoy cooking at home, so as to continue the good growth momentum of the business we are seeing now.”

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