On May 11, Uni-President China Holdings Ltd. (hereinafter "Uni-President China") issued an announcement disclosing its profit data for January-March 2022 in the mainland market. According to the announcement, in Q1 2022, Uni-President China earned RMB 329 million, with earnings per share of RMB 7.63 cents. It is reported that Uni-President China's Q1 2022 revenue grew by a high single-digit percentage year-on-year, mainly driven by beverages, with tea and juice performing notably, while food revenue also grew by a high single-digit percentage, with the premiumization trend unchanged, and "Qiao Huang" revenue grew several times year-on-year. At the same time, Uni-President China specifically mentioned that in terms of net profit performance in Q1, the premium food "Kai Xiao Zao" saw pre-tax profit grow by a mid-double-digit percentage year-on-year, while the beverage business grew by a single-digit percentage year-on-year. ****Steady "For the entire Uni-President Group, stability is the most important policy," said Lo Chih-hsien, Chairman of Uni-President Group. "As long as we have a solid foundation, we can sacrifice and not grow. But when you don't want it, because the foundation is laid, the company will grow automatically." Why does he say this? This stems from the unstable growth of the past few years. The most obvious example is the two former star products in the beverage category, "Hai Zhi Yan" and "Xiao Ming Tong Xue". After reaching product maturity, these super-star products began to gradually decline to a stable state, but due to their initial high-profile launch, the company was still struggling to meet performance targets. So we saw that later, Uni-President proposed the concept of inventory reduction, controlled market expenses, returned to the essence of product affordability, and advanced steadily. This finally paid off in the past year or two. Both the 2021 annual report and Q1 2022 results show that the beverage segment has rebounded overall, with significant growth, driving the company's overall performance to improve steadily. Another major business segment that has seen significant changes is the food segment, which is also worth attention. Remember the uproar five years ago when Lo Chih-hsien proposed that Uni-President would "exit" the instant noodle market? Of course, the word "exit" in quotes means not leaving the instant noodle market, but repositioning. That year, Uni-President launched a noodle innovation plan, redefining traditional mainland instant noodles as "life noodles". Looking back now, this move, which seemed to defy the world at the time, laid a solid foundation for Uni-President's current convenience food segment. It can even be defined as a far-sighted initiative. Afterwards, Uni-President jumped out of the previous competitive entanglement and focused on doing its own thing. It successively launched innovative product lines such as "Tang Da Ren", "Man Han Yan", "Kai Xiao Zao", and "Na Jie Na Xiang", gradually shifting from instant noodles to fresh food, fulfilling its promises. According to the 2021 annual report data, over the past two years, the revenue proportion of products priced above RMB 5 in the food segment has reached 41.4%, with a compound annual growth rate of 24%. The compound growth rates for "Kai Xiao Zao" and "Na Jie Na Xiang" are both in the triple digits. From Q1 this year, "Kai Xiao Zao" continues to maintain double-digit growth, performing impressively. However, just like "Hai Zhi Yan" and "Xiao Ming Tong Xue" in beverages, Uni-President remains cautious about the growth rate of "Kai Xiao Zao". If products grow too fast, the internal organization becomes impetuous, and they hope the market will calm down so they can focus on refining products. We see that whether in the beverage or food segment, Uni-President's pace is steady-first. Because they have experienced too many instances of "haste makes waste," today's Uni-President is not in a hurry to expand, but rather focuses relatively, seeking new development opportunities while maintaining stability. ****Building Now, after breaking old organizational habits such as impatience and impulsiveness, Uni-President China has established new organizational capabilities. With a stable mindset, there are more highlights, and a more flexible and enthusiastic team is taking on their new mission. This is what "no breaking, no building" means. Under extreme circumstances like the pandemic, the advantages of the new organization are highlighting their value. In 2022, the pandemic has shifted from abnormal to normal. The impact of the pandemic has changed from nationwide to regional, and can even be reduced to modular management at the level of a community or a unit. In this context, challenges are posed to the organizational form of FMCG sales and omni-channel operations. The ways products reach consumers have become diversified, and companies need to continuously adjust their sales teams. In the event of a sudden pandemic, practical issues such as how to operate, how to ensure normal product flow, etc., are placed in front of them. Recently, when Shanghai experienced a pandemic outbreak, Uni-President China's headquarters is also in Shanghai, and many managers and sales personnel were trapped at home. But this did not stop their thinking. They launched an anti-epidemic group-buying package in Shanghai, bundling instant noodles, self-heating food, beverages, etc., specifically for home-based meal supply. This transformed single-product purchases into multi-product purchases, providing one-stop supply. Another example is the bC integration initiative that Uni-President China has been working on. Traditional deep distribution only places goods in stores, but bC integration connects manufacturers, stores, and consumer information. These preparations have played a role during the pandemic. During the Shanghai pandemic, as a guaranteed supply enterprise, after solving distribution issues, even with stores closed, thanks to bC integration, consumer orders could be completed entirely online for transactions and delivery. Manufacturers and stores collaborated on online orders, enabling contactless delivery. The new organization is key. Without organizational strength, individuals cannot solve the problems posed by the pandemic. An agile and efficient organizational system can adapt to changing circumstances, thereby facing problems and challenges. During the pandemic, sales may be important, but there are more important things for companies to do. While taking care of its own normal operations, Uni-President China is also actively participating in social events. In the past March and April, subsidiaries of Uni-President China across the country were actively taking action... In Shanghai, Uni-President delivered essential items such as instant noodles, self-heating food, and beverages to frontline medical institutions like the Shanghai Public Health Clinical Center and Hongqiao Hub. In Changchun, Uni-President sent instant noodles and beverage products worth over RMB 100,000 to teachers and students at Jilin University. In Zhengzhou, Uni-President donated anti-epidemic慰问 items to the Zhengzhou Airport Economy Zone Charity Federation, including 5,800 boxes of instant noodles worth over RMB 210,000, to support the fight against the pandemic in the airport zone. In Hangzhou, Uni-President donated 200 boxes of instant noodles and 200 boxes of beverages as love supplies to frontline medical staff, volunteers, and community workers at Xiasha Street in Hangzhou. In Harbin, Uni-President donated over 200 boxes of beverages, instant noodles, mineral water, and other supplies to the Songhuajiang Police Station in Nangang District. In Guangzhou, following last year's donation of Xiaoye Brown Sugar Ginger Tea worth RMB 300,000 to disabled people in Guangzhou, Uni-President donated a batch of beverages to the Guangzhou Disabled Persons' Welfare Foundation, including Xiaoye Brown Sugar Ginger Tea and Xiaoye Sour Plum Drink, totaling 3,559 boxes, with a product value of nearly RMB 214,000. In Wuhan, Uni-President donated anti-epidemic慰问 items worth RMB 1.2 million to support local pandemic prevention and control efforts... "Since this year, COVID-19 has rebounded in some cities. On the basis of strict pandemic control, the company has stepped up production, actively coordinated to solve logistics difficulties, and made every effort to ensure production order and material supply during the anti-epidemic period," said a relevant person in charge of Uni-President China. Final Thoughts: The pandemic is still spreading, and challenges continue for both companies and individuals... But overall, the report card Uni-President China delivered in Q1 2022 is in line with the company's positioning and market expectations. Under the pandemic, Uni-President's organizational strength has been commendable. As Uni-President Chairman Lo Chih-hsien said, "As long as the organization becomes stable, we naturally have more energy to discover new growth opportunities. So in this regard, we are quite reassured about the future." Are you "watching" me?