Skip to content
whether it’s the Internet or traditional genes, the truth is more important than the name.
After five years of explosive development, the vitality forest with an estimated value of more than $15 billion suddenly found that the Internet gene is not enough to solve all problems, and there is an answer it urgently needs on the other side of the “traditional beverage world”.
But few people noticed him.
This is the staff restaurant of Yuanqi forest Chuzhou factory. It’s time for dinner. The restaurant composed of more than 100 tables for four is full. Tang Binsen looked around with his plate and couldn’t find a seat for a long time.
No one got up to give up his seat to the founder of vitality forest. At the small table next to the meal, an executive who had just changed jobs from a traditional beverage enterprise saw the scene with his spare light. He carefully looked at several colleagues next to him, but found that they were used to eating. After a few seconds, Tang Binsen quietly walked to the empty seat in the farthest corner for dinner.
“In traditional beverage companies, this is unimaginable.” The executive of xianyuanqi forest told Hu olfactory that in his past common sense, beverage companies paid great attention to sequence, rank and qualifications. What impressed him was that in the previous owner, whenever executives had a dinner, the central chair would be vacated to the chairman of the board of directors in advance – even if the chairman didn’t come to dinner that night.
“Maybe this is the Internet gene?” the executive asked. He admitted that he had never worked in a large Internet factory. When he reported to the company headquarters of Yuanqi forest in Liangmaqiao, Beijing on the first day, he was shocked by the current situation: nearly one hundred people gathered at more than a dozen tables in Yuanqi forest hall. They were very moving and even debated loudly. “No traditional beverage company is like this.”
“New vitality forest man” with the same experience as this executive Not a few. From the second half of 2020, executives, middle-level and even grass-roots employees from traditional beverage companies such as uni president, nongnongshanquan, Wahaha, Master Kang and Coca Cola joined Yuanqi forest in batches. A middle-level employee of Yuanqi forest with a sense of humor told Hu olfactory that he had worked in two traditional FMCG companies for more than 16 years, and there were three biggest challenges after coming to Yuanqi forest : learn to use “flying book”, adapt to young employees after 95 calling their names directly, and get used to “lighting cigarettes” by hand.
These people from the traditional beverage world are also bringing another gene to Yuanqi forest, and Yuanqi forest is trying to speed up this gene recombination: since December 2020, the total number of employees of Yuanqi forest has been close to 6000, and the enrollment has been expanded by nearly 50% within the year, of which only people from traditional catering enterprises account for more than 70%.
These rapidly recruited talents are concentrated in both production capacity and channels: from July 2020 to now, the “light volume” vitality forest that once completely relied on OEM + heavy injection e-commerce channels has rapidly evolved into a “heavy asset company” with 5 beverage factories and more than 183000 traditional channel terminals , even its annual target has become quite traditional – the offline channel sales target in 2021 is 7.5 billion yuan, more than nine times its online target.
On October 26, Li Bingqian, general manager of Yuanqi forest production center, told huolf, “Internet genes are more reflected in Yuanqi forest’s corporate culture, organizational style and other links, but some laws of the traditional beverage world still play a role in building factories and expanding channels.”
This genetic recombination has also brought challenges to Yuanqi forest. A person who did not want to be named told huolf that enrollment expansion and expansion are making Yuanqi forest enter the “digestion cycle”. “From the rise and fall of business lines to the design of sales wage structure, there are conceptual differences between the two genes. A large number of new people are recruited in an instant, and it is too late to unify business processes and concepts.” The person said frankly that Yuanqi forest wanted to complete the 20-30-year road of the traditional beverage company in three to five years, resulting in temporary pain.
Keen capital did not put the brakes on the restructured vitality forest. On the contrary, capital lightly stepped on the accelerator. It is reported that before and after the Tianjin plant of vitality forest was put into operation in July this year, a new round of financing of vitality forest was quietly opened. The financing valuation has been greatly improved on the basis of April this year. Some people familiar with the matter said that the valuation of vitality forest will exceed US $15 billion after this round of investment.
A party in the late night of 2019 is the key for Yuanqi forest to open the door of “gene recombination”.
Tang Binsen and Li Bingqian went to visit a beverage factory owner with high grade baijiu. Shortly after, some partners of Yuan forest temporarily broke up, resulting in a shortage of energy forest.
The detail that impressed Li Bingqian was that according to the sales plan, a batch of goods should be introduced to all major channels in early March, but the factory delayed to start construction after repeatedly asking future generations. After several “hard requests”, the factory finally arranged some production capacity on March 21, but temporarily reneged on that day.
It was a series of “capacity breach” events that led to the late night party in 2019. Li Bingqian frankly said that it was a “very humble” visit. After an unsuccessful exchange, Tang Binsen and Li Bingqian flew back to Beijing that night. On the way to the airport, it rained slightly. Tang Binsen looked at the raindrops on the window for a long time and said to Li Bingqian: “Lao Li, we still have to build our own factory.”
But building a factory is by no means an easy task.
In 2018, the sales of Yuanqi forest was less than 200 million yuan. There are few brands of self built factories in the beverage circle with sales of just over 100 million, which is related to production loss and operation and maintenance efficiency. In the past two decades, there have been two mainstream factory building modes in China’s beverage industry: one is the OEM branding. These companies are often the OEM of international brands or local top brands. With the increase of orders, they continue to expand production capacity and finally complete the expansion from the upstream of the supply chain to the downstream of the C-end; The other is the expansion capacity model supported by strong sales. These brands first established strong sales channels and reverse improved the upstream capacity based on this.
Li Bingqian suggested to Tang Binsen that when the annual sales of Yuanqi forest exceeded 1 billion yuan, the plant construction plan should be started, which is a more stable model: on the premise of guaranteed sales, the capacity after the expansion of the plant can be fully digested through Yuanqi forest channels, so as not to lead to inventory backlog, but also to maintain a benign production sales ratio.
A relevant person from a traditional beverage company told huolf that Tang Binsen and other Yuanqi forest executives had discussed self built production capacity with many people in the traditional beverage industry from 2018 to 2019, but the suggestions given by most people from traditional beverage companies were “stabilize first”, “seek stability” and “ensure survival first”.
This is a game of two kinds of thinking. The industry insider told Hu olfactory that the traditional beverage world is a very cruel jungle: in the past 20 years, many companies have dreamed of becoming Chinese Coca Cola, but most of them have not even solved the problem of survival in the end. “Most people who have been immersed in this circle for more than ten years will regard seeking stability as the first priority. You won’t and don’t want to take risks. Everyone praises stability.”
The person even cited an example. In Internet companies, a program error called “bug” can be modified. However, in a beverage factory, a mistake may lead to production accidents and drinks with potential life hazards; In the traditional beverage sales channel, a mistake may lead to the backwater of dealers in the whole “province”, or your brand can’t enter a certain area for more than ten years. “If you have a problem with playing games, you can at most be scolded by players; if you have a problem with making drinks, you may lose your life,” the person whispered.
According to people familiar with Tang Binsen, Tang is no stranger to these situations. After continuous visits and numerous centralized exchanges from 2018 to 2019, he once lamented to his friends that making drinks is not exactly what he thought.
At that time, there were two options for Yuanqi forest. One was to be steady like other traditional beverage companies. At least from the performance in 2019, this model was also feasible. The annual sales of Yuanqi forest in 2019 exceeded 800 million yuan, an increase of nearly five times compared with 2018. If the status quo was maintained (OEM production + reliance on e-commerce and convenience store channels) Yuanqi forest may maintain a considerable growth rate and continue to develop. The other option is to “seek wealth insurance” and build its own factory in the case of less than 1 billion sales.
The key question behind this game is, what did the uncertainty of the capacity of the OEM affect the vitality forest at that time?
On the surface, the uncertainty of production capacity has brought “chaos” at the sales end of Yuanqi forest. From 2019 to the first half of 2020, the sales plan of Yuanqi forest was seriously affected by production capacity.
Once a line of sales to Li Bingqian and other production capacity director Tucao: “make complaints about the sales of Yuan forest.” the normal sales process is that sales can be completed according to the sales plan and clear inventory list. At that time, the sales of Yuanqi forest could only be “watched and sold” — what the foundry could produce, it would sell first.
But the deeper crisis is that this disorder of production capacity is making the “Internet gene” of Yuanqi forest impossible.
In Tang Binsen’s early public sharing, he clearly pointed out that “Yuanqi forest should be a product closer to users” and have a faster “market response speed”. Li Bingqian and others told Hu olfactory that in an ideal state, the sales data of the C-end market will be reflected in the production capacity of Yuanqi forest in time, and Yuanqi forest will dynamically adjust the production capacity accordingly and launch products more liked by the market in reverse. In the case of heavy reliance on OEM, this method of play is impossible.
While Yuanqi forest was worried about the beverage OEM capacity, the supply of “bottle capacity” was cut off in May 2020. It is reported that at that time, the bottle body of Yuanqi forest was also completed through OEM. Due to the special bottle body design concept, the OEM production process was more complex. After the contemporary workers broke the appointment, Yuanqi forest could not find a fast and replaceable bottle body OEM capacity for a while. “Don’t mention selling drinks. Even selling empty bottles that users like doesn’t have the ability.”
Even, this production capacity shortage makes the marketing idea of Yuanqi forest impossible to implement. A relevant person who once participated in the Yuanqi forest marketing plan at that time disclosed that from 2019 to 2020, some products were supposed to match the marketing activities, but in the end, there were no matching promotion resources because the production capacity could not keep up and the goods could not appear in the market as planned.
According to relevant sources, in 2018, Tang Binsen carefully considered the feasibility of building his own factory. By the second half of 2019, this idea had evolved into a concrete scheme. A series of “supply interruption” and “contract breaking” events this year accelerated the pace of Yuanqi forest’s “embracing the traditional world”. By the third quarter of 2019, the self built capacity was a certainty.
In June 2020, Yuanqi forest Chuzhou plant was officially put into operation. In the same year, Guangdong Zhaoqing, Chuzhou phase II and Tianjin Xiqing plants started rapidly. From the change of self built capacity, we can see the urgency of Yuanqi forest: after the completion of Chuzhou plant in June, the annual output of Yuanqi forest’s self built capacity is 900 million bottles. Only six months later, this capacity has been expanded to 2.3 billion bottles. By June 2021, the annual output of Yuanqi forest’s self built capacity has reached 2.9 billion bottles.
At the national dealer conference at the end of October 2020, Tang Binsen told hundreds of dealers that 2021 would be the product year of Yuanqi forest. With the emergence of self built capacity, Tang Binsen plans to bring more products to the market. However, the challenge from the channel is also becoming the “Achilles heel” looming in the vitality forest.
Go to the “old world” to find channels
For the vitality forest under the OEM mode in 2019, the channel problem is not prominent. At this time, the channels of Yuanqi forest are mainly divided into e-commerce platforms dominated by tmall Jingdong and offline channels dominated by 711, convenience bee, Wal Mart, Yonghui and other convenience stores and supermarkets.
A relevant person told huolf that from 2016 to 2019, Yuanqi forest’s offline channel expansion was mainly based on brand convenience stores and chain hypermarkets. By the beginning of 2020, Yuanqi forest had entered almost all mainstream middle-end convenience stores and hypermarkets in first and second tier cities.
Yuanqi forest skillfully selected the “new world” in offline channels, which is regarded as the key to the rise of Yuanqi forest. From 2016 to 2018, the upsurge of venture capital of new convenience stores appeared. These convenience stores often accurately cover white-collar and young people gathering places such as office buildings and schools. They change the game rules of small supermarkets and small shops and rarely deeply bind with a beverage brand.
Taking convenience bee as an example, the shelf rules of convenience bee are even full of Internet genes: the person in charge of product selection needs to be responsible for product sales, and the brands that rank top in store sales are often matched with better shelf positions, and stores will dynamically adjust shelf positions through traffic data. At that time, Wal Mart, Yonghui and other supermarkets had a “new trend”. In order to cope with the impact of e-commerce platforms on hypermarkets, these supermarkets would deliberately choose some new products for young consumers.
“That’s why Yuanqi forest expanded its online and offline channels rapidly before 2019, but did not encounter problems after 2020.” an unnamed beverage industry practitioner told huolf that with the self built Capacity Upgrading of Yuanqi forest in 2020, the existing convenience stores and supermarkets are not enough to digest so many products, Some beverage brands also began to launch bubble water competitive products, which led Yuanqi forest to look for opportunities in the “old world” from 2020.
The old world described by this person is the key stage for the fight of the beverage track in the past two decades: a capillary sales network composed of small supermarkets, small shops, restaurants, parks, wholesale markets and even small shops at the entrance of the village.
This is a Jianghu full of human game. No one will pay simply because of the five words “Internet gene”.
A local promoter from the second tier coastal city in the east of Yuanqi forest told huolf about a detail. He once took his products to a local small supermarket chain to sell them. Because Yuanqi forest did not provide the policy of “giving gifts”, the person in charge of the supermarket refused to cooperate. In the process of communication, the person in charge of the supermarket once said to him with a joking look: “Coca Cola can give me several boxes of things. Your family is better than coke?”
There are many stories of gene conflict in this old world. For example, the vigorous forest promotion personnel in a southern city once declared to the superior leaders that “it is necessary to invite the person in charge of a local supermarket to the bath center”, but they were directly rejected by the leaders of Internet companies. The promoter was even questioned by the leaders about “principles” and methods. But he felt wronged: “this Jianghu has operated like this in the past few decades.”
As Yuanqi forest pays more attention to offline channels, it has more in-depth and frequent contact with the old world. At the dealer conference at the end of October 2020, Tang Binsen stood on the stage and made an ambition to hundreds of dealers from all over the country. “Yuanqi forest will still provide you with products with the largest profit margin in 2021.” at that time, the dealers on the stage shouted like a carnival.
But then, some dealers realized that greater challenges were coming. Because they gradually understand a key point: Yuanqi forest not only wants them to bring their products to the “old world”, but also wants them to bring “the rules of the game of Yuanqi forest”.
It was at this conference that Yuanqi forest released a new “dealer evaluation system”. Two key indicators are worth pondering: the scale of dealers’ working capital and whether it can help Yuanqi forest expand its territory within the existing channel system.
Under the supply mode of Yuanqi forest, the dealer should first place an order with Yuanqi forest, and according to the rules of Yuanqi forest, the dealer should settle the cash. The purchase volume is directly related to the level of dealers, which means that high-level dealers should spend money to buy the products of Yuanqi forest and put them in their own warehouse first.
Huge incentives make dealers dare to bear this inventory risk.
Since 2016, Yuanqi forest has created more “gross profit space” for dealers through products with higher customer unit price. It is understood that the gross profit space of bubble water in Yuanqi forest is significantly higher than that of “similar products in most markets”, and under the strict “national anti collusion” policy of Yuanqi forest, regional dealers are almost the only official source of goods in the location.
Behind the first mock exam, the two key is that dealers must get enough goods to sell, and distributors should be able to cover more channels. Under the influence of these two factors, the sales network of Yuanqi forest can roll like a wheel.
But this is by no means an easy thing.
Not all products of vitality forest are explosive. In the process of dealers taking goods, Yuanqi forest’s products are not purchased at will. If you want to buy only pop bubble water, you can’t do it. You must buy it in combination. More than one dealer told huolf that selling new products of Yuanqi forest is a challenge.
A phenomenon arising from this is that many dealers have sold out of the hot bubble water early, while there is still a stock of new products. At this time, if you continue to purchase, it means that you will get more new categories while getting more bubble water. “That’s why there are dealers who cross provincial goods and commit crimes against the wind with bubble water.” a dealer who did not want to be named told huolf that some people even increased the price to buy bubble water in the hands of other dealers, but rarely saw someone increase the price to sell new categories.
Another key challenge is that it is by no means easy to expand more terminal channels in the short term, because international and local head beverage companies have worked for 20 or 30 years in small shops, small supermarkets and other channels. If you want to expand more channel terminals, Yuanqi forest needs to match specialists in the region as soon as possible to infiltrate and contact.
“Don’t only focus on high-end convenience stores and chain stores, but focus on a more grounded market, which is the main stage of the beverage world.” a market analyst told Hu olfactory that all domestic beverage brands will match a large number of “local push” personnel in the terminal channel. Their real mission is to influence the mind + maintain contacts. “You need to use employees to reach the real world, which may also be a traditional problem that Internet thinking can not completely solve. You see, the number of BD in meituan is astronomical, and so is Ali.”
Who can represent the vitality forest to reach the larger real world? In the second half of 2020, Yuanqi forest’s recruitment of “children soldiers” may be one of the answers. At that time, Yuanqi forest recruited newly graduated college students on a large scale and sent them to the front-line sales post after training.
There were some old guns in the beverage circle who didn’t think so. They believe that in the traditional beverage world, sales is the most special type of work. In the traditional common sense, these need to help the brand open up the city and expand the land. They don’t need any bright academic qualifications, but they need contacts, circles and understanding the Jianghu survival philosophy. Of course, it’s best to know some “black words”: for example “When a small channel dealer holding 12 supermarkets suggests that you want to exercise at night, don’t ask others to play badminton.”
Most of these old guns were surprised when they heard that Yuanqi forest gave some college students a base salary of more than 10000 yuan. In the survival philosophy of the traditional beverage world, giving too high a base salary for sales is easy to lead to lazy people. “Newly graduated college students rarely get a base salary of 10000 yuan for sales positions.” an old salesperson in the beverage industry said, “In the beverage industry, we earn commissions and bonuses, and the basic salary of newly graduated children is three or four thousand.”
The logic behind the high base salary is that Yuanqi forest is eager to have a group of “sales corps” with its own genes. When a sales director of Yuanqi forest inspected the local market, he found that some grass-roots sales from “friends” used the words and methods learned from friends to promote Yuanqi forest’s products.
“Vitality forest needs children’s soldiers, either from graduates, or to rewrite the minds of the backbone dug.” an unnamed person in charge of traditional beverage corporate culture and brand development told huolf that in the beverage sales circle, it is often said that it is “linked” from which factory, “For example, the one who looks like Wahaha, the one who looks like a farmer, and the one who looks like a Japanese enterprise… Now Yuanqi forest needs to answer what kind of people they send to sell thousands of terminals all over the country?” the industry insider paused and said: “What kind of people will eventually attract what kind of channels. People and channels are inseparable. People are channels.”
A person in charge of a medium-sized chain convenience store in East China told Hu olfactory that in the spring of 2021, he saw the employees visiting Yuanqi forest for the first time. He was less Jianghu and more bookish. “It’s not so much from the beverage company… It’s more like the Internet company?”
Internet genes can no longer solve all the troubles of the vigorous forest.
By the end of October, the bubble water imitation of a “Yuanqi Senlin” company in Shaanxi had appeared in a small shop outside the Fifth Ring Road in Beijing. The word “Qi” in the bottle and the word “Yuanqi Senlin” written on it are very confusing. You can’t tell the true from the price of 5.5 yuan. But this is not the only case that Yuanqi forest encountered in the fake goods.
Li mumbling, head of Yuanqi forest’s anti-counterfeiting and rights protection team, told huolf that in 2021, more than 2000 “imitation information” appeared in Yuanqi forest’s store inspection system in a single month. These imitations and authentic products are placed in the channels of Yuanqi forest at the same time. When the salespeople of Yuanqi forest regularly patrol the store, some shopkeepers are not even afraid and unmoved.
It is worth pondering that this time the Internet world is even helping. In a sinking e-commerce head platform, Li mumbling’s team found a variety of Shanzhai products and imitations, but up to now, Yuanqi forest is unable to communicate effectively with the platform.
The platform disclosed to huolf that, according to relevant Internet regulations, as long as the store has legal qualification and the product itself has qualification, the platform has no obligation to verify whether it belongs to imitation or cottage products. Yuanqi forest needs to find relevant evidence and appeal through background communication one by one.
The trouble brought by the Internet to Yuanqi forest is more than that. On October 28, Yuanqi forest apologized to users for the “Taobao store operation accident”. It is reported that a total of 145000 users placed orders to buy “ultra-low price products”. According to Yuanqi forest, if the transaction is completed according to the existing order, the loss of Yuanqi forest will exceed tens of millions of yuan.
But is traditional gene really the master key?
Just in May this year, when Yuanqi forest team was developing a new product, it debated the cost of raw materials. Under the traditional beverage product R & D mode, the project team will first provide a cost scheme according to the sales forecast and select raw materials in the price space. However, the mode of Yuanqi forest is not the same. Yuanqi forest will directly open the cost evaluation link, give priority to product R & D, and then ask the production side for optimization suggestions. Some employees who have just arrived at Yuanqi forest from the traditional beverage circle do not adapt to this model. “If we follow the R & D model of traditional beverage companies, many products of Yuanqi forest cannot be approved, because the cost exceeds the standard.” an insider told huolf that the genetic characteristics of many traditional beverage industries may need to be changed in today’s era.
For example, are the more complex interpersonal and sequential relationships of traditional beverage companies really suitable for today’s beverage track?
An unnamed person related to Yuanqi forest said that any product in Yuanqi forest will be launched at least two project teams at the same time. (groups A and B, some major categories and even groups C and D) some post-90s or even post-95s product managers will lead the team respectively with post-80s and post-85s product managers. In traditional head beverage companies, the group led by young people is only the “atmosphere group” – from personnel matching, resources to leadership attitude, they tend to the group with deeper qualifications. But in the vitality forest, these are floating clouds. There were product managers who had worked in the beverage industry for more than 12 years and lost to the post-95 product manager in the blind test link. Finally, after 95, the project participated by the product manager entered the commercialization stage.
But coins have two sides.
A. Group B competition mode is a common means of many Internet companies. When Yuanqi forest adopts this strategy, it does bring some vitality on the surface, but is this mode really perfect? The above-mentioned person euphemistically said that people are complex animals. Now more “old qualifications” from the traditional beverage circle join the vitality forest, but not everyone can adapt to this flat company style. “But are the people who are eliminated or take the initiative to leave really worthless? Not necessarily.”
In the Chuzhou factory of Yuanqi forest. There are many “old workers” who have worked for nearly 20 years. Here, you will even clearly smell the familiar flavor of the traditional world: when young workers ask for advice on some problems, they will skillfully make a cup of tea or light a cigarette for the old workers. There are no Internet Games competing between groups A and B here, because only the old trade union can accurately tell you what key adjustments “feed liquid” should make when the outdoor temperature exceeds 2 ℃.
Perhaps Yuanqi forest needs to find a more balanced gene recombination point.
In the face of deeper human nature, neither the Internet gene nor the traditional gene is the only good policy.
Outside every Yuanqi forest factory, there will be thermostatic trucks. When Yuanqi forest bubble water comes down from the production line, it will be put into the container with “compartment temperature” maintained at 4 ℃ for the first time. In the next 24 hours, the driver needs to send it to the receiving place as soon as possible.
Previously, there were drivers who deliberately detoured the path in order to save high-speed fees.
In 2021, Yuanqi forest installed 24-hour detection sensors connected to satellites for all trucks. Every truck can be detected on time wherever it is every second.
But some drivers have found other tricks.
Until Yuanqi forest increased subsidies for drivers, so that they can drive through the toll stations calmly and happily. Since then, every car in Yuanqi forest has only walked on the highway.
Foodaily每日食品携手全球顶级商业与产业合作伙伴，打造第八届Foodaily FBIC2022全球食品饮料创新大会&首届Foodaily EXPO每日食品创新博览会，并以“新食品时代——品牌生态化”为主题，通过为期3天的新消费创新试验场 ✕ 全球创新产品的舞台 ✕ 食品开发者大会 ✕ 顶级产品社交圈，贯穿食品产业链上下游，链接新消费商业全场景，向新食品时代的终局再迈进一步，一次讲透中国食品新消费的未来，360°呈现品牌生态化。2022年5月31日-6月2日在上海，我们邀您共同见证。（点击图片查看详细介绍）。
- Yum China appointed a new chief supply chain officer. Haidilao’s share price rose today, the prices of some products of Zuming shares increased, Starbucks opened its first “intangible cultural heritage experience store” in China, and Lai Yifen signed a 200 million purchase order
- Guangxi’s three major powders, why can snail powder fly alone?