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prefabricated dishes are flying in the wind, but the future is still bumpy. How to find the deterministic value in the consumption trend of C-end of prefabricated dishes and find a living method for long-term growth is the road that prefabricated dish enterprises must take.
How hot are the prefabricated dishes in the first half of 2022?
During the Spring Festival, according to the data of many e-commerce platforms such as dingdong shopping, HEMA and Jingdong home, the sales volume of prefabricated vegetables increased by three times or even more than three times year-on-year; Shandong, Guangdong, Henan, Hebei and other provinces and cities have successively issued policies for the development of prefabricated vegetable industry, striving to build a “capital of prefabricated vegetables”; In April, under the tide of hoarding vegetables caused by the repeated epidemic, fresh e-commerce platforms that have been struggling in the loss line, such as dingdong shopping, burst into vitality, and stocks rose sharply against the trend
Not to mention the more than 10000 prefabricated dishes newly joined in 2020, as well as cross-border catering and food material enterprises. From track giants to small workshops, prefabricated dishes are on the eve of outbreak and ready to enter a state of fierce battle.
However, compared with the emergence of TOC prefabricated dishes at the industrial end, the consumer market seems to be more controversial. Some people believe that prefabricated dishes are a new dietary solution, but others believe that the current prefabricated dish Market “is lively on the surface and can not hide the deep coldness”.
So, is the prefabricated dish a real demand or a fake demand? Recently, foodaily daily food specially planned a series of activities of # family kitchen revolution # prefabricated dishes 2.0. In the first live broadcast on May 19, foodaily invited Jiang Yicheng, partner of OC & C Greater China, Luo Zilong, vice president of Xingwang investment, Li Yuanfei, founding management partner of Xingwang investment, Pu Wenming, CEO of Zhenwei Xiaomei garden, Dai zhenkai, founder and CEO of Zuo Dashi, Li Chunyan, vice president of Guolian aquatic products group, Wang Bin, chairman of lihewei Wang Biao, CEO of SouFun lion, and many other celebrities conducted a comprehensive discussion and thinking around “the future of TOC for prefabricated dishes”:
1. Hot in the dispute, is the prefabricated dish just a catalyst for the epidemic?
2. The heroes compete for the C-end prefabricated dishes. Who can win?
3. What is the future of prefabricated dishes finally competing for?
Controversy: is the C-end of prefabricated dishes a false demand?
From the current situation, the popularity of prefabricated vegetables is mainly related to the epidemic, especially the C-end. Then “will consumers pay for prefabricated vegetables after the epidemic?” We can’t escape this concern.
Is the impact of the epidemic on prefabricated vegetables phased or long-term?
To answer this question, we must first make it clear that prefabricated dishes are not a new format, but essentially an improvement in the efficiency of the format.
As early as 2010, simple washing or cutting prefabricated dishes have appeared. After 2010, prefabricated dishes have been used to meet the needs of cost reduction and efficiency increase of b-end catering. In recent years, the emergence of takeout has made the most of prefabricated dishes. Although the b-end cooking package has long appeared, consumers’ awareness of prefabricated dishes is more due to the epidemic.
Before the epidemic, some companies entered the field of C-end prefabricated dishes, but the scale was generally very small. Until 2020, the demand for home under the influence of the epidemic increased, resulting in the increasing demand for C-end prefabricated dishes. At the same time, the “throwing money” boost of the end of the capital makes the C-end of the prefabricated dish really come out of the circle.
In particular, the recurrence of the epidemic in 2022 put the prefabricated vegetable market on the eve of the outbreak. CCTV Finance reported that the head of the fresh food business department of a retail group said that the sales of prefabricated vegetables in China increased by more than 100% year-on-year in March, and the most severe situation in Shanghai increased by more than 250% year-on-year in nearly half a month.
Therefore, it is undeniable that the epidemic situation is objectively beneficial to the prefabricated vegetable industry. During the live broadcast, many guests believed that “the epidemic in 2022 has accelerated the penetration of prefabricated vegetables to the C-end to a certain extent. The tide of goods hoarding and the education investment of multiple players in the market have further shortened the education time of consumers, reduced the education cost and improved the acceptance of users.”
If public life gradually returns to normal, will the consumption demand for prefabricated vegetables heated by the epidemic gradually calm down? “No”, the guests gave this answer, “after the epidemic, consumers’ cognition of prefabricated vegetables will still stay. The consumption habits formed by the epidemic are actually difficult to change, and this process is irreversible”. Perhaps the growth rate will slow down, but the consumption of prefabricated vegetables will become a normalized demand.
Is the C-end of the prefabricated dish a real demand or a false demand?
In fact, no matter at the b-end or C-end, when making prefabricated dishes, we must find out what problems the prefabricated dishes are solving, who is the consumer, and understand the underlying logic in order to grasp the future development direction.
“The epidemic situation is not the core factor for the sustainable development of prefabricated vegetables. In fact, it is related to the maturity of the whole supply chain and the change of consumer demand.”
From the supply side, prefabricated dishes are produced when the efficiency of the supply chain is improved to a certain stage. On the one hand, in recent years, China’s compound seasoning track has risen rapidly, and the food processing industrialization has become more mature. It is more qualified to upgrade the compound seasoning and ingredients into prepared food, that is, prefabricated dishes, which is the bottom logic of the whole industrial chain. In addition, the upgrading of cold chain logistics and refrigeration technology, as well as the popularity of emerging electrical appliances such as ovens and air fryers, are promoting the sustainable development of the prefabricated vegetable industry.
From the demand side, prefabricated dishes are not only a sharp tool for b-end businesses to reduce costs and increase efficiency, but also a “lazy Gospel” for C-end consumers to solve efficiency.
You know, prefabricated dishes originated in the United States and Japan. Take Japan as an example. Although the origin of Japanese prefabricated dishes is the development of freezing and fresh-keeping technology, it has benefited from the changes of family structure after 90 years, “one person eating”, being single, family cooking habits and other driving factors. Part of the reason for the rise of China’s Prefabricated dish C-end is also due to the “lazy economy”, “single economy” and other factors driven by the new consumption wave in 2020.
Further analyze the needs of consumers to see whether prefabricated dishes can really enter consumers’ daily life. According to OC & C survey data, most consumers’ interest in prefabricated vegetables has increased significantly, and more than 40% ~ 50% of consumers said they would significantly or to a certain extent increase their consumption of prefabricated vegetables.
At present, the core consumers in China are mainly women, more inclined to married and educated women, white-collar workers, etc., and the consumption of prefabricated dishes is mainly concentrated in the first and second tier cities, and the consumer groups still have limitations.
However, OC & C’s earlier survey showed that “no matter after the epidemic or in the current epidemic, everyone will want to eat more at home.” In other words, after the epidemic, home diet will become one of the trends. This means that in addition to takeout and dining out, prefabricated dishes will also become one of the needs.
From this perspective, although the overall prefabricated vegetable market is in its early stage, its consumption potential is expanding, which is not a pseudo demand, but there is still a long way to go for C-end consumer education.
Zhulu: who will win the C-end prefabricated dish?
Prefabricated dishes are starting the family kitchen revolution. Although the major enterprises in the upstream and downstream of the industrial chain have come to share, the competition pattern is still very scattered. At present, there are more than 70000 enterprises related to prefabricated vegetables, which are mainly divided into five types:
1) Taking spring kitchen as an example, the professional brand enterprise of prefabricated dishes has the advantages of better scale in Hunan cuisine track, while the disadvantages are high regional limitations and low degree of factory automation;
2) Upstream agricultural, animal husbandry and aquatic enterprises, poultry, aquatic products and meat enterprises began to enter the track, focusing on the b-end, but also some expansion towards the C-end. Their advantages lie in the cost of upstream raw materials, supply chain advantages, large-scale automatic production capacity and strong R & D capacity. The disadvantage is that the brand building power is weak and the ability to control the demand of end consumers is not strong;
3) For catering enterprises, taking Jia Guolong Kung Fu cuisine Xibei’s new brand as an example, its advantage lies in the brand advantage of offline stores and good product restoration, while its disadvantage lies in large initial investment and high single product price;
4) Traditional quick-frozen food enterprises, such as Anji, Sanquan and missing, whether they are small class B customers or C-end Ka supermarkets, their advantages mainly lie in brand and channel advantages, while their disadvantages lie in their insufficient understanding and customization ability to consumers;
5) New retail enterprises, such as HEMA and dingdong, have the advantage of data and insight into consumer preferences, while the disadvantage is that it is difficult to control quality and has a single sales platform.
It can be seen that there are many types of participants in prefabricated dishes, including upstream supply chain, midstream production enterprises, downstream catering and new retail enterprises, and enterprises in almost the whole catering industry chain are trying to tap this treasure.
And different types of players have different competitive advantages and disadvantages. For example, Guolian aquatic has been deeply cultivated in the aquatic industry in the past 20 years and established an integrated supply chain system of “research, production and marketing”. In this system, it has its own advantages in terms of production standardization, R & D and innovation.
In the past 12 years, Lihe flavor has mainly built a relatively complete industrial chain around flavor, including not only the processing and extraction of flavor plants that provide core flavor such as pepper, cumin, Angelica sinensis and fennel, but also composite seasonings and prefabricated dishes. Among them, the most core is R & D ability, which is the difference of brands.
However, for the taste lion, which has been established for a short time, the core advantage at this stage is also mainly reflected in consumer insight and product design ability. In the long run, it will gradually cut from the downstream to the upstream. However, at present, it is to establish the advantage on the consumer side, provide consumers with products with more differentiated, scarce value and high reduction taste, and give consumers a good product experience.
At present, although there are hundreds of flowers in the prefabricated vegetable industry, Wang Biao, CEO of the taste lion, believes that “each enterprise may still test in the market with its own cognition or based on some experience and resources”, and it is also more early accumulation in its own advantageous fields.
It may be too early to talk about the outcome. However, referring to the US Japan model, the US model has a high degree of standardization and strong channel bargaining power, and Japan pays attention to taste formula. From the perspective of China, Luo Zilong, vice president of Xingwang investment, believes that due to the market characteristics such as diversified tastes, rich cuisines and difficulty in improving the degree of standardization, “At the end of the development of the prefabricated vegetable industry, the efficiency and model effect brought by industrial chain coordination can support enterprises with greater market value, and some enterprises with industrial pricing power (formula resource type) can win. In short, it is the same as the essence of prefabricated vegetables and is determined by the combination of efficiency and profitability.”
Future: what is the final contest of prefabricated dishes?
Although the growth space of prefabricated vegetables is large and the upward trend is obvious, it is in the early stage of development, but the pain points of the industry are clearly visible.
1. Serious homogenization
OC & C data show that the star products in the current prefabricated dishes have obvious characteristics: most of them are heavy flavor, which should be very delicious; Mainly meat dishes and hard dishes; In addition, more attention is paid to non routine and supplementary prefabricated dishes. At present, the prefabricated vegetable industry has a certain degree of homogeneity, so the competition is fierce and lack of differentiation.
2. The taste is not satisfactory
Like other food and beverage categories, the quality of ingredients, the taste of dishes and the diversity of products are the primary considerations for consumers to choose prefabricated dishes. When a new outlet looks up, most consumers will have expectations for it. However, the reality is that many prefabricated dishes do not meet the expectations of consumers, especially in the transformation of taste and technology.
If the consumer does not buy prefabricated vegetables, what is the reason? From a large number of consumer feedback, “the ingredients are not fresh”, “the degree of reduction is not high, not delicious”, “a lot of condiments have been added in advance, which is unhealthy”, or the product quality is poor, which is pulling down the consumers’ sense of experience and deepening the gap between consumers’ expectations and reality.
3. Lack of standardization
If any industry or track wants to continue to move forward and go longer, it must use standardization to restrict the development of the industry. Otherwise, no matter how good the market outlet is, it may be due to inconsistent standards, which may eventually lead to poor product experience at the market and consumer ends, including consumers’ different opinions on the taste of prefabricated dishes.
At present, there is no unified standard in the industry for the freshness of raw materials, technology in the production process and freezing and preservation technology of prefabricated vegetables. In the future, more efforts need to be made in the standardization and standardization of each link of the industrial chain.
In addition, Wang Bin, chairman of Lihe flavor, also pointed out that “the infrastructure construction of the direct distribution system of cold chain logistics has not been fully completed. At present, express delivery is a very high cost link in the delivery of frozen products. The talent density on the supply side is also a pain point. Prefabricated vegetable enterprises will basically feel the pressure of talent shortage, especially in product development and innovation and brand marketing.”
Based on this, the more brands entering the market, the more serious the homogenization phenomenon, and the consumer cognition and market education are still in the primary stage. What the prefabricated food brands need to think about is how to seize the tuyere and solve the pain points in the future competition? From the perspective of lengthening the time line, what is the core of prefabricated dishes?
First, the online and offline integration mode of C-terminal line is the direction.
At the present stage of “category but no brand” of prefabricated dishes, the barrier of commodities may not be strong. Unless the factory and formula have core technical barriers, it is obvious that most factories and products have no barriers, and explosive products will always be copied in large quantities. Moreover, except that the upstream agricultural, animal husbandry and aquatic products enterprises can get the price advantage at the source, most of the other prefabricated vegetable enterprises can not monopolize the raw material end.
“On the whole, we believe that at this stage, the more important barrier to the C-end of prefabricated dishes is the channel,” said Pu Wenming, CEO of Zhenwei xiaomeiyuan, “So Zhenwei Xiaomei garden has been continuously laying channels in the past two years. Since the prefabricated dishes belong to the cooking solution, people should shop where they buy vegetables, such as HEMA, dingdong, community stores, hypermarkets, Tiktok, tmall, etc. only in this way can you quickly penetrate the market share and take the lead.”
Dai zhenkai, founder and CEO of Satoshi, also agreed with this view. “I think prefabricated dishes are ultimately a channel business and to C, so the most key in the channel business is their own channel. In fact, weizhixiang has proved this. The unique channel from scale to market layout has helped it occupy a certain market position.”
Secondly, it has the advantages of efficiency and scale effect brought by industrial chain coordination.
Whether it is the b-end or the C-end, the most important thing is to do a good job in the products, provide consumers with products and services with the highest cost performance, maintain the ability of continuous product innovation and ensure the safety of food in the whole chain. In the end, it must be a combination of strong product R & D ability, strong supply chain management and control ability and strong production efficiency system to realize the lasting service to consumers, This requires enterprises to continuously optimize and iterate in the supply chain. Without the stability and support of the supply chain, it is difficult to go far.
In addition, in order to achieve the ultimate cost performance, the scale should be adopted. Whether it is deep or wide, that is, whether it is category logic or single product logic, it is necessary to form scale in the end. For example, Zuo Dashi Dai zhenkai pointed out that “it is very critical to form a large-scale single product trade at the b-end. In particular, the Chinese cuisine is complex. If you choose a category with a certain consumer cognitive basis, you can quickly expand the single product without further education.”
Moreover, it has comparative advantages in specific links of the industrial chain, and forms a model and company of substantive pricing power.
For example, it has advantages in upstream raw materials, and Guolian aquatic products has advantages such as cost advantage and strong price control ability; Another example is the differentiated products in the midstream. The positioning of Lihe flavor is high-grade prefabricated dishes. It hardly makes home dishes, such as roast lamb leg and Wellington steak, which are troublesome from raw material purchase, equipment purchase to final cooking. After being made into prefabricated dishes, it can not only solve the time cost and craft gap, but also solve the sense of ceremony in the family scene.
In the downstream, in addition to channels, brand marketing occupies the mind of consumers. Why should consumers choose you for the same product? What is the feeling of brand in the mind of consumers? Why buy your products over and over again? This is the mental asset of consumers that a brand company needs to manage. It is the brand impression that an enterprise finally leaves in the eyes of consumers through long-term communication and long-term publicity with consumers.
Finally, enterprises need strong organizational ability to cooperate.
Continuous product innovation, omni-channel Department layout and brand publicity all need sufficient talent density and strong organizational strength. Whether the brand can develop to the whole country may be affected by the products, but more importantly, the organizational ability. Especially in regional expansion and national expansion, it must be whether the organizational ability can keep up and establish an efficient organization, which requires the joint efforts of the founder and the whole team.
Generally speaking, at present, prefabricated vegetables can become the darling of the market and capital, and are expected to have a trillion market valuation. More of them are “Heroes created by the times”. For those who want to join the game, the road of C-end consumers is not easy to go, and the way forward is not smooth. There are certain problems in product quality, supply chain, differentiation, cold chain and other all-round problems, which still need to be solved.
Whether the prefabricated food is hot air or long-term demand and which enterprise model can succeed depends on the competition of all factors of the enterprise, and the ultimate competition is the internal strength of the enterprise.
On May 19, we invited several celebrities to chat about the business opportunities of C-end prefabricated dishes. In the second live broadcast from 14:00 to 17:10 today (May 24), we will share the brand practical experience and industrial innovation trend of prefabricated dishes to C from the perspective of category opportunities and industrial innovation, and scan the code to make an appointment for the live broadcast.
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