A classic snack of kraft Heinz, which is quite common in the Chinese market, has been involved in the rumor of sale. This “scandal” is aimed at Hormel, the owner of sijibao peanut butter.
Today, the Wall Street Journal quoted people familiar with the matter as saying that kafheinz is about to conclude a sale deal to sell its nuts and snacks business of American gentlemen to Hormel Foods Corp. for about $3 billion (about 19.377 billion yuan). If the talks go well, the deal could be announced next week, people familiar with the matter said.
It is one of the largest nut snack brands in the United States, and also has a high reputation in China, especially among consumers in South China. According to xiaoshidai, after Kraft and Heinz merged into “one family” in 2015, the gentleman brand originally owned by Kraft was officially introduced to China through official channels in 2016. For a long time before that, gentlemanly brand was imported and sold by dealers.
Now, is this famous nut snack brand going to “change owners”?
In response to this, in reply to the inquiry made by the snack agent today, kafheinz China said: “the business transactions and overall operation of the group are uniformly responded by the US headquarters. If there is any exact information, the headquarters will release it in time. “
“The American gentleman brand was officially introduced through the official channel of kafheinz (China) in 2016, and has been favored by consumers all the way. Thank you for your trust and support.” Kraft Heinz China told xiaoshidai that China is an important strategic market for Kraft Heinz and the “number one opportunity” for Kraft Heinz to achieve growth in its international business.
“Any action we take is to realize the sustainable development of enterprises through more efficient and more focused strategies, and focus on providing high-quality products and services for Chinese consumers.” Kafheinz China said today.
It is said that the gentleman brand to be sold this time is the “time honored” snack brand in the United States.
According to the public information read by snack agents, gentleman brand was founded in 1906 by two Italian immigrants in the United States. In 1960, it was acquired by standard brands, a food and beverage company in the United States. In 1981, standard brands merged with Nabisco brands, an American snack company, and then it was acquired by Kraft food in 2000. After that, kraft and Heinz merged to form Kraft Heinz in 2015.
At present, gentleman brand mainly deals in a variety of nut products and mixed snacks (such as mixed snacks such as nuts and grape raisins). It is a brand of kafheinz with annual sales of about 1 billion US dollars, and its products are sold in many markets such as China. The famous “image” of the nut brand is a “Mr. peanut” with a top hat and a single lens.
Some products of gentleman nuts sold in China
Today, a person familiar with the industry told xiaoshidai that since around 2019, the official channel of kraft Heinz’s gentleman brand business has withdrawn from the Chinese market in a low profile. In this regard, as of the time of Xiaoshi Dai’s publication, kafheinz China has yet to reply.
According to the search of xiaoshidai today, Jingdong, tmall, HEMA and other channels sell gentleman’s nut products (as shown in the figure below), but the related products do not appear in the official flagship store of kafheinz tmall. In HEMA, the distributor of this product is an enterprise in Zhuhai.
Box horse products on sale
According to the official website of kafheinz China, at present, in addition to the gentleman’s nuts, the company mainly deals in Heinz tomato sauce, salad sauce, barbecue sauce and other Western sauce business in China, Weishida sauce, Guanghe sufu, Meiweiyuan pepper and other Chinese sauce business, as well as Heinz infant rice flour, noodles and puree and other complementary food business.
The official website also mentioned in the introduction of “kafheinz (China) brand and product development process” that on April 20, 2018, “inspired by the performance of gentleman brand”, kafheinz launched the creative snack brand “kaffun family” in China, which is specially designed for Millennials.
Hormel, who is said to be taking over the gentleman brand, is also an American food giant with many businesses in China. Data show that in addition to the chili sauce of the same name, Hormel has a series of other food brands, including Skippy peanut butter and spam lunch meat sold in China.
According to the Wall Street Journal today, the company’s market value is about 25 billion US dollars (about 161.53 billion yuan). In recent years, due to its diversified development, it has been an active buyer in the market. If a deal is made with the gentleman card, it will be the biggest deal for Hormel so far.
Although it is not clear whether the gentleman brand will be stripped, one thing is for sure that kafheinz is simplifying its business and plans to focus on the “most promising brands”.
Xiaoshidai introduced that in September 2020, the multinational food giant announced a major strategic adjustment at the annual investor conference. In order to release its growth potential, a major change in the business model of the food giant is that when managing its numerous products, it is no longer divided into the previous 55 categories, but is newly divided into “six platforms” to manage its product portfolio.
Kafheinz’s new “six platforms”
“More resources will be invested in our core brands to achieve greater results.” “We decided to win big victories, not just to play small games and play safety cards,” Miguel Patricio, Global CEO of kafheinz, said at the meeting
Some businesses are “abandoned” directly. Last September, for example, kafheinz announced that it would sell some cheese brands to French dairy giant randlis group for us $3.2 billion (about RMB 21.6 billion). The annual sales of the brands sold are about 1.8 billion US dollars (about 12.16 billion yuan), accounting for about 7% of the company’s annual revenue.
Brand of cheese sold by kafheinz last year
Xiaoshidai introduced that at last year’s investor conference,
“We have applied the new business model to other markets (outside North America), such as China.” Rafa Oliveira, President of kafheinz’s international business, described China as “the best and most exciting example” at the meeting.
Right now, kafheinz is really adding to the Chinese sauce and condiment market. Last August,. The total investment of the project is about 700 million yuan, which is one of the largest single investment projects of kraft Heinz in the world in recent years.
In fact, healthy snacks such as nuts are being sought after by more and more consumers in the Chinese market. In a report released in January 2020, inmant pointed out that nut snacks are still the largest segment of snacks with the largest market share, and have shown a strong growth trend in the past five years.
But for gentlemanly, it is also facing strong competition from local brands in this snack market segment, such as three squirrels, baicaowei and liangpin shops. It is not easy to “stand out”.
In recent years, the performance of gentleman brand is not outstanding. The Wall Street Journal pointed out today that like the cheese business, kraft Heinz’s nut business is in a highly commercialized industry, struggling to compete with the store’s own brand.
“In recent years, kraft Heinz has found business opportunities for the brand because it is in line with the trend of low-carbon water and high protein snacks, but its efforts to expand it have not been so successful. Last summer, due to the decline of the performance expectations of six brands, including it, kraft Heinz wrote down 290 million US dollars (about 1.873 billion yuan) The report said.
According to reports, when the epidemic broke out, the sales of groceries surged, which made the classic products that had gradually faded out of the sight of consumers suddenly become popular again. But as demand weakens and the industry trades more, companies are re adjusting their product mix to meet changing tastes.
If Kraft Heinz intends to spin off the business, including the gentleman card, then now may be a good time to sell “good price”.
Because consumers will buy more snacks at home during the epidemic period, many snack giants achieved good sales growth last year, such as Yizi. Dirk Van de put, the company’s chief executive, said in a recent performance call that the Yizi brand has won many new consumers. The company is increasing its advertising budget and will focus more on digital channels.
Recently, in the Chinese market, due to the impact of the epidemic, various places have advocated the “stay in place” of this year’s Spring Festival, with a large-scale flow of people, which has also led to the rise of snack stocks and other related concept stocks. Yesterday, the limit of Chacha food rose, Yanjin shop rose by 4.91%, three squirrels rose by 4.31%, and peach and plum bread rose by 3.63%.
According to the survey data of the Spring Festival of the year of the ox recently released by Kaidu, the snack agent has noticed that due to the decrease of offline activities during the Spring Festival (such as travel, movies, dinner, etc.), the Spring Festival is expected to give birth to another wave of small upsurge of e-commerce shopping. According to the data of respondents who are going to shop during the Spring Festival, the categories mentioned more frequently are: food (77%), snacks and nuts (76%), clothing (63%), wine (50%) and shoes (49%).