Click to read the original article for details Source: China Securities Journal Author: Gao Jiachen Recently, Zong Qinghou, Chairman and General Manager of Wahaha Group, announced the official launch of Wahaha's new marketing platform, "KuaiXiaoWang". The platform aims to further integrate the supply chain and distribution system, deploy a big data marketing network, and achieve digital empowerment of the real economy. From being "not interested in e-commerce" in the early years to now fully embracing e-commerce and even building its own e-commerce platform, Zong Qinghou, a representative of the older generation of Zhejiang merchants, is changing his mindset. When asked whether Wahaha has plans for an IPO in the near future, Zong told a China Securities Journal reporter that an IPO depends on demand, and in a "Versailles" manner, stated that Wahaha is currently not short of money, with 15 billion yuan still in the bank! The Real Economy and Virtual E-commerce Are Not Completely Opposed Zong Qinghou stated that in the early stages of e-commerce, the practice of buying traffic with money, purchasing products at high prices and selling them at low prices to capture market share, not only dealt a significant blow to the traditional real economy but also threw the pricing system into chaos. Once a monopoly was established, it raised traffic and advertising fees, ultimately harming the interests of consumers. Furthermore, as virtual e-commerce moves toward standardized development, issues such as integrity problems, vicious competition, and monopolies have gradually emerged. Zong Qinghou said that the real economy and virtual e-commerce are not completely opposed. For both to achieve sustainable development, they must establish a mutually dependent ecological relationship. Virtual e-commerce depends on the real economy for its existence. Without the real economy to provide products, virtual e-commerce would be like a tree without roots or water without a source. The real economy also needs to use internet technology to improve management, optimize product quality, and expand brand influence, and it needs the power of e-commerce for upgrading and transformation. "Online-offline integration has become the future direction of the industry. Many internet companies are now developing offline, and many physical enterprises are developing online. In my view, the challenge of going from top to bottom is considerable, while the foundation for going from bottom to top is more solid. This is what I call physical e-commerce. For traditional physical enterprises, because they already possess strong offline channels, market resources, spot goods, warehousing, logistics, and service experience, if they can also be equipped with a reasonable set of e-commerce tools and use the digital economy to empower the real economy, they can achieve the integration of online and offline marketing networks. From this perspective, the advantages of physical e-commerce are quite obvious." Deploying a Big Data Marketing Network to Achieve Digital Empowerment of the Real Economy Zong Qinghou introduced that over more than 30 years of development, Wahaha has always been rooted in the food and beverage industry, carefully weaving a network of nearly 10,000 distributors, hundreds of thousands of wholesalers, and millions of sales terminals, reaching deep into counties, towns, and villages across the country like capillaries, allowing Wahaha's new products to be distributed nationwide in the shortest possible time. The KuaiXiaoWang platform launched by Wahaha is a marketing platform developed specifically for the FMCG industry and open to the entire industry. "Relying on Wahaha's strong sales network and distribution capabilities, it can achieve a closed loop of online ordering, nearby delivery, and offline delivery, helping small and medium-sized enterprises solve a series of problems such as channel sinking, centralized procurement, distribution, and delivery, achieving efficient product circulation and delivery," said a relevant person in charge of Wahaha. Zong Qinghou said that in the future, Wahaha's KuaiXiaoWang will further integrate the supply chain and distribution system, deploy a big data marketing network, and achieve digital empowerment of the real economy. "The original intention of Wahaha in creating KuaiXiaoWang is to help the rich assist the poor, promote rural revitalization, and achieve common prosperity; it is to seek higher-quality development for daily necessities, FMCG, food and beverage, and other daily household goods industries," Zong Qinghou said. A relevant person in charge of Wahaha said that driven by this intention, manufacturers that join the KuaiXiaoWang platform will not be charged any entry fees, and for users who need to purchase goods but lack funds, the platform will also introduce bank loans to alleviate financial pressure and support the sustainable development of their businesses. The signing ceremony for Wahaha's Wencheng intelligent beverage project was also held on the same day. Zong Qinghou officially announced an investment of nearly 500 million yuan to build a Wahaha intelligent beverage production base in Juyu Town, Wencheng County, Wenzhou, Zhejiang, to help achieve common prosperity through industrial revitalization. IPO Depends on Demand; Wahaha Is Not Short of Money Speaking of Wahaha, one cannot help but think of another drinking water giant also from Hangzhou, Nongfu Spring, which currently has a market value of HK$449.9 billion. Founder Zhong Shanshan, due to the successive listings of Nongfu Spring and Wantai Biological, saw his wealth surge and once sat on the throne of China's richest person and even Asia's richest person. (East Money) (East Money) Unable to avoid the topic, Zong Qinghou was asked the "soul question" that has been posed many times: Does Wahaha have plans for an IPO in the near future? Zong told a China Securities Journal reporter that an IPO depends on need. If large-scale investment is truly needed, then it can go public. Wahaha is currently not short of money, with 15 billion yuan still in the bank! Zhu Danpeng, an analyst in the food and beverage industry, told a China Securities Journal reporter that China's FMCG must be operated with online and offline integration, and online and offline resources must be mutually integrated. Wahaha's creation of "KuaiXiaoWang" conforms to the development trend of the entire industry. E-commerce is also a key focus for Wahaha's future development and a tool and means for future growth space. "Wahaha's growth points and future focus will definitely be to meet the core needs and demands of the new generation, which is the general direction." Zhu Danpeng said that Wahaha's strategy is to go to third-, fourth-, and fifth-tier cities; Nongfu Spring goes to first- and second-tier cities and then sinks to third-, fourth-, and fifth-tier cities. "Everyone's path is different, and the results are also different. It is easy to go down after doing well in first- and second-tier cities, but if you originally only went to third-, fourth-, and fifth-tier cities and now want to go to first- and second-tier cities, it will be relatively difficult." PS: From August 24 to 26, 2021, the 2021 (4th) China FMCG Conference hosted by "New Distribution" will be held in Shanghai. Focusing on industry trends + practical cases + growth-oriented connections as the core, 3,000 FMCG practitioners will gather at the event. 10 themed forums cover new retail O2O, community group buying, short video live e-commerce, distributor transformation, rise of new consumer brands, interpretation of new alcoholic beverages, distribution B2B supply chain, omnichannel marketing, B2B2C new technology applications, etc. Operators in each segment will bring the latest case studies for interpretation. Some of the confirmed heavyweight guests so far include: **1. Tao Shiquan, founder of Jiangxiaobai; **2. Yao Xuhong, General Manager of Meiyijia Holdings Co., Ltd.; **3. Lu Xiuqiong, Global Expert Partner at Bain & Company and former Vice President of Marketing for Coca-Cola China; **4. Chen Xiaodong, Senior Vice President of Nestlé Greater China; **5. Zhang Fujun, President of Lee Kum Kee Sauce Group China; **6. Bi Chaojiao, General Manager of China Resources Snow Breweries (China) Marketing Center; **7. Yang Hongbin, Vice President of Junlebao Dairy Group; **8. Yang Shun, COO of Lipton Greater China; 9. Zhang Yipeng, General Manager of Kuaishou E-commerce SKA Brand Operations Center; 10. Li De, General Manager of E-commerce at Gold Hongye Paper Group.... A grand gathering for FMCG practitioners, you must be there! Are you "watching" me?