Every time by reporter Xie Zhenyu Every time by intern reporter Xiong Jianan Every time by editor Wen Duo
On April 11, Shuijingfang held the “Shuijingfang · Well Platform New Upgrade Conference”, announcing that the quality, price and packaging of its core product well pad had been upgraded. The “Daily Economic News” reporter learned on the spot that the suggested retail price of the 52-degree new generation well platform will be upgraded from 738 yuan/bottle to 808 yuan/bottle.
Relevant analysts told reporters that the upgrade of Jingtai can further consolidate its high-end brand positioning, enhance the brand value of Shuijingfang, and provide certain market and sales support for Shuijingfang’s future layout in the sub-high-end and high-end markets. On the other hand, after the company raised the price at the end of the third quarter of last year, the net profit attributable to the parent company declined in the fourth quarter, and it may still be difficult to upgrade the price in the off-season this time.
Core product price increase
Zhu Zhenhao, CEO of Shuijingfang, said: “Since the three strategies of ‘high-end brand, product innovation and upgrading, and marketing breakthrough’ were proposed last year, the upgrade of Jingtai is an important milestone.” He also said that Jingtai has been on the market for 22 years and has accumulated a lot of Fans are one of the few liquors in the same price segment in the industry that can exceed 1 billion yuan (annual sales). With the continuous consumption upgrade of the Chinese liquor market, this price band will be the fastest growing segment in the future.
Recently, under the trend of high-end liquor, major liquor companies have made frequent moves. Kweichow Moutai launched a new product “Moutai 1935” at the beginning of the year, targeting the price range of 1,000 yuan; at the end of the year, Luzhou Laojiao raised the suggested retail price of “100-year Luzhou Laojiao 60 years old” wine to 558 yuan per bottle; Wuliangye’s eighth generation Puwu The suggested retail price has been raised from 1399 yuan/bottle to 1499 yuan/bottle. Judging from the prices announced at the press conference, the suggested retail price of the new generation well platform of 52 degrees is 808 yuan/bottle, and the suggested retail price of 38 degrees is 768 yuan/bottle, aiming at the price range of 500 yuan to 800 yuan.
Cai Xuefei, general manager of Zhiqu Consulting and a liquor expert, said: “I personally believe that 500 yuan to 800 yuan has become the main force in the sub-high-end price band, which is one of the core competitive price bands for famous wines. Jingtai is a highly competitive wine. Advantageous products, directly entering this price band, can further consolidate the high-end brand positioning of Shuijingfang, and at the same time enhance the brand value of Shuijingfang, providing certain market and sales support for its future layout in the sub-high-end and high-end markets.”
It is understood that Shuijingfang liquor products mainly include Shuijingfang Yuanming and Qing Dynasty, Shuijingfang Jingcui, Shuijingfang Collection Master Edition, Shuijingfang Jingtai, Shuijingfang Zhenniang No. 8, Shuijingfang Hongyun, Shuijingfang Meilan, Zhuju and so on. Among them, Shuijingfang Jingcui, Shuijingfang Collection Master Edition, Shuijingfang Jingtai, and Shuijingfang Zhenniang No. 8 are the company’s main core products. The suggested retail prices of the products are 1999 yuan/bottle, 1399 yuan/bottle, 708 yuan/bottle and 528 yuan/bottle. .
The annual report shows that from 2017 to 2020, the company’s high-end products achieved revenue of 1.924 billion yuan, 2.726 billion yuan, 3.407 billion yuan and 2.928 billion yuan, respectively, accounting for 93.94%, 96.7%, 96.28% and 97.42% of the revenue. .
The company’s 2021 annual performance forecast shows that it is expected that the net profit attributable to the parent will increase by about 468 million yuan year-on-year, an increase of about 64% year-on-year; operating income will increase by about 1.626 billion yuan, an increase of about 54% year-on-year; sales volume has increased by about 3171,000 compared with the same period last year. rose, an increase of about 40% year-on-year, and all sales growth came from mid-to-high-end wines.
Cai Xuefei believes: “Jingtai is a classic product of Shuijingfang. Under the trend of consumption upgrading, improving its quality and price is an important measure to reactivate the product’s life cycle.”
Will the price upgrade live up to expectations?
It is worth noting that Shuijingfang raised the price of well pads at the end of the third quarter of last year, but the price increase did not seem to have a direct positive impact on the company’s performance. On September 30, 2021, Shuijingfang announced a 30 yuan increase in the suggested retail price of Jingtai.
The “Daily Economic News” reporter calculated based on the company’s 2021 annual performance forecast that the company is expected to achieve revenue of 1.209 billion yuan in a single quarter in the fourth quarter, a year-on-year increase of 14.05%, but the expected net profit attributable to the parent is 199 million yuan, a year-on-year decline of about 100 million yuan. 13%.
In this regard, Kaiyuan Securities Research Report analyzed that in the process of high-end development, the company continued to strengthen brand marketing efforts in the fourth quarter, and the advertising expenses were relatively large, resulting in a year-on-year decline in the net profit rate in the fourth quarter. From the perspective of leveling the whole year, the company’s 2021 annual revenue and performance are still at a relatively fast level compared to 2019.
But there are also industry insiders put forward a different view. Liquor expert Xiao Zhuqing analyzed to the reporter of “Daily Economic News” that generally famous wineries will raise prices before the peak season, and famous wine agents will buy back all the wines to be sold in the peak season at the old price before the price increase. The price of Shuijingfang increased by 30 yuan in the fourth quarter, but the performance still declined, which shows that it has not achieved the purpose of increasing the price, and it also shows that the psychological price expectations in the minds of consumers have not increased. This time, it is more difficult to upgrade product prices in the off-season.
“The successful price increase of liquor requires good brand value, good social inventory, and strong execution and sales and service system.” Xiao Zhuqing said that whether Shuijingfang can stand at a market price of more than 800 yuan in the future, on the one hand, needs extensive On the other hand, it continued to increase the creation of IP culture, and actively improved the psychological price expectations of the Shuijingfang brand in the minds of consumers.
Jiang Wei, General Manager of the Commerce Department of Shuijingfang, also said that in the future, Shuijingfang will comprehensively increase the investment at both ends of the BC, spread the market rhythmically, and then carry out a competitive value chain design to improve terminal profits. At the same time, it will invest more in consumer cultivation. .
Source of cover image: Photo by intern reporter Xiong Jianan
