Looking at China's consumer market in recent years, there has never been a shortage of stories about beverage companies crossing into dairy or mutual crossovers, but the results have mostly been unsatisfactory. In July this year, the joint venture 'Keniu Le', once highly anticipated by the industry, was dissolved after five years, marking its end. The cross-industry pair of Coca-Cola, known as the 'father of beverages', and Mengniu, a leading dairy giant, also met a parting of ways. Half a year later, the same fate befell Genki Forest and its dairy business unit, Beihai Ranch. On November 17, at Genki Forest's 2025 distributor conference, founder Tang Binsen announced a major strategic adjustment: the dairy brand Beihai Ranch would be split from the group and operate independently. After the split, Beihai Ranch will focus on the low-temperature yogurt segment and will later introduce an experienced management team to drive the brand's full independent operation. Beihai Ranch's departure from Genki Forest, and the dissolution of 'Keniu Le' after five years, raise the question: although beverage companies have never stopped coveting the dairy sector, why do these seemingly perfect cross-industry combinations always end up going their separate ways? Blind Spots in Beverage-to-Dairy Crossovers 1. Differences in Category Attributes Dairy products have inherent rigid nutritional and functional attributes. Taking the low-temperature yogurt segment that Beihai Ranch focuses on as an example, it appears more in fixed consumption scenarios, such as breakfast, after meals, or before bedtime. Beverages, on the other hand, are meant to satisfy consumers' need to drink anytime, anywhere. Compared to dairy, which is primarily based on 'nutrition and function', the core of beverages is still 'great taste' and emotional value, with health and nutrition coming second. On the basis of great taste, beverages are played with unexpected twists, each more novel than the last, maximizing consumers' emotional value, sometimes incorporating a sense of unpredictability—this is the intrinsic trait of the beverage category. Differences in category attributes often reflect in brand positioning and operational pace. As a dairy brand independently launched by Genki Forest, Beihai Ranch, backed by the group, did not benefit from the group's brand halo and resources in a 'greatest common divisor' way. The 'resources of a big company' and the 'agile soul of a startup' seem to have been in a state of disconnect. 2. Operational Differences and Ineffective Resource Synergy Coca-Cola and Mengniu's joint venture launching 'fairlife' can be seen as a landmark event of a beverage giant entering the dairy industry. But its failure is not an isolated case—for companies accustomed to selling sparkling water, various teas, or functional drinks, 'leading a cow' seems not so easy. Fundamentally, the R&D genes, channel types, and core selling points of the two sides may not be directly grafted or leveraged. Take low-temperature yogurt, which Beihai Ranch excels in, as an example: Dairy companies' R&D and supply chains have long revolved around 'milk sources and fermentation strains', while the beverage industry innovates rapidly; from various waters to functional drinks to teas, formulas and processes change with each passing day, and trends are unpredictable. 'Speed' is the survival rule engraved in the beverage track. The R&D directions and paces of the two sides are not entirely the same. Looking at channels, low-temperature yogurt is mainly sold through supermarkets, community stores, periodic subscriptions, or 'planned home delivery', with a high proportion of cold-chain distribution; many beverages rely on convenience stores, e-commerce channels, and ambient logistics. These differences mean that even in the same terminal, low-temperature yogurt and beverages may be just a step apart, but the organizational structure, operational systems, mindsets, and the focus of sales personnel behind them are vastly different. In terms of selling focus, low-temperature yogurt with a specific shelf life, once past half of its safe period, may not be easy to clear even at half price. Therefore, for the dairy industry, whether it's low-temperature fresh milk, yogurt, or ambient milk with a longer shelf life, when time reaches the safety line, quick clearance is the core of selling; otherwise, losses outweigh gains. This may be why dairy manufacturers still need sales personnel at terminal distribution, unlike beverages that naturally sell at ambient temperatures. Genki Forest's advantage lies in ambient channels and terminal freezer placement, but Beihai Ranch's main low-temperature yogurt requires refrigerated counter resources at terminals, where Genki Forest's existing distribution system cannot help much. The synergy initially imagined between the two has not been evident in actual execution. However, for beverage companies to cross into dairy, besides capital and professional talent, they must also overcome the threshold of 'milk sources' and mature experience in dairy processing. Back then, to support Beihai Ranch's development, Genki Forest continuously increased resource investment. In 2021, Beihai Ranch invested 130 million yuan to build a professional yogurt production line in Chuzhou, Anhui; the same year, Genki Forest strategically invested in dairy farm operator AustAsia Group to build a stable milk source guarantee system for Beihai Ranch. In 2024, Beihai Ranch's second self-built factory, located in Xianning, Hubei, began production, with a total investment exceeding 1 billion yuan, featuring 12 dairy production lines and an annual capacity of over 150,000 tons. However, Beihai Ranch's existing and controllable milk source resources, compared to large dairy companies with vast milk source territories (such as the recent Guangming's full acquisition of Xiaoxiniu, which is essentially a battle for yak milk sources), still appear insufficient. Moreover, they have not truly supported Genki Forest's explosive product matrix. Therefore, beverage companies may also experience 'acclimatization issues' in the dairy field: from category awareness, R&D technology, to channel models, they need to relearn. It is evident that there are many more realistic gaps in the process of crossing from beverages to dairy: compared to sparkling water, low-temperature yogurt and other dairy products have more complex technology, production, and quality control processes, and more stringent requirements for milk sources; for Genki Forest, its fast-paced approach in the beverage industry may not be fully applicable to the dairy industry. Of course, there are successful precedents of beverage companies entering the dairy industry. International food giants like Nestlé and Danone started with dairy and later successfully expanded into water, coffee, baby food, and other fields, becoming food empires. But their crossovers were mostly achieved through mature acquisitions or long-term deep cultivation. So, besides the objective factors of industry essence and category differences, the deeper reason shaking Genki Forest's decision to abandon its yogurt layout should be related to the increasingly fierce competition in the low-temperature yogurt industry and Beihai Ranch's own declining state in recent years. The Declining Beihai Ranch If the category differences and operational misalignments discussed above explain more about 'why beverages find it hard to do dairy well', then the real problems Beihai Ranch faces are: on one hand, the high-end low-temperature yogurt track has undergone fundamental changes; on the other hand, its own development has fallen behind Genki Forest's growth pace. 1. High-End Yogurt Falls from Grace China's yogurt consumption wave took off in 2015, and by 2019, its market retail scale grew from 104.6 billion yuan to 149.18 billion yuan (data source: CIC's Blue Book on the Yogurt Industry). At that time, the rapidly growing yogurt track attracted startups represented by Classy Kiss, Beihai Ranch, Lechun, Jianai, and Wudao. These emerging brands, which rose on 'zero-additive', 'good complexion', 'beauty and skincare', 'low GI', 'sleep aid' and other 'fancy marketing concepts', under the banner of 'redefining yogurt', with visual design impact and unique styles, catered to Generation Z's preferences. Of course, they also came with higher prices. Beihai Ranch, born in 2018, firmly caught this wave. According to a previous report by The Times Weekly, brand COO Wang Yuelin revealed that in 2022, Beihai Ranch's revenue grew 30% year-on-year, securing a place in the competitive dairy market. However, the three-year pandemic quietly swept through, greatly reducing foot traffic and consumption frequency in supermarkets, gatherings, nightclubs, outdoor leisure, and shopping, significantly reducing consumption scenarios for low-temperature yogurt. The increasingly prominent snack attribute, which is non-essential, reduced budget allocation from household necessities, bringing a clear impact on the market growth of low-temperature yogurt. By the end of 2023, it entered a full decline cycle at -11.4%. At that time, data from NielsenIQ showed that from January to September 2023, offline sales of low-temperature yogurt nationwide fell 8.7% year-on-year, and sales volume fell 10.2%. Industry growth 'weakness' and sales 'decline' have become indisputable facts. During the heyday of low-temperature yogurt, most emerging brands, from the moment they entered the track, completely abandoned the mature competitive trajectory and instead elevated competition to another level with a mindset of high quality, high price, and high value. They focused on mothers, children, and the middle class, concentrating on value. They believed that as long as they created value without lowering prices, consumers would still choose them. The hidden truth behind this is that China's yogurt industry chain had become very mature, and emerging startup brands did not need to own farms or processing plants. With mature supply chain and industry chain support, it was easy to enter this track. Thus, another equally important truth: for startups, the only way was to take the high-end yogurt route, as high unit prices were needed to cover costs. To maintain the high-value persona, massive marketing costs not only burned through rounds of external financing but also ate into the profit margins formed by 'high-end' product pricing. This market operation model was the correct and only choice for startups without sufficient milk source support at the time. However, in the present, it is gradually failing. Because the times have changed! Facing consumers who are increasingly unwilling to pay, and the reality that fewer people buy high-priced yogurt, these emerging brands have begun to re-examine the environment, reorganize product lines, and try to cater to the market with more affordable products, shifting from a focus on profit to a goal of market scale. 2. Low-Temperature Yogurt Shifts to an Era of Scale Economy After a period of adjustment, low-temperature yogurt has begun to rebound. Data shows that since the end of 2024, prices have continued to fluctuate at low levels; according to data from Mashangying, in Q1 2025, the dairy industry's category structure adjustment accelerated, with low-temperature pure milk and low-temperature yogurt not only increasing market share but also maintaining positive sales growth of 2.51% and 2.58%, becoming the core drivers of category growth. This phenomenon reflects the trend of price wars and promotional wars among brands, pulling the category toward a new quality-price ratio. The return of yogurt to the mainstream, normal price band is the main reason for further expanding the market penetration of low-temperature yogurt. For example, Blueglass, known as the 'Hermès of yogurt', is undergoing an unprecedented price shock. On food delivery platforms, some product prices have quietly dropped from the previous high unit price of 49 yuan to 19.9 yuan, a decline of up to 60%. It can be said that price wars are a necessary path for many industries to mature, and low-temperature yogurt is no exception. The scale effect generated by the low-price return of yogurt has further increased industry concentration. According to public industry data, the CR5 group (top five companies by share) in the domestic low-temperature yogurt market consists of Junlebao, Yili, Mengniu, Guangming Dairy, and New Hope Dairy, with a combined market share exceeding 70%. Beihai Ranch, targeting the low-temperature yogurt track, still needs to compete for market share with these five major brands. However, high-end yogurt brands represented by Beihai Ranch are constrained by limitations in milk source capacity, control of core strains, and self-sufficiency. Currently, the selling price of core SKUs is still higher than the industry average unit price. For example, for 0-sugar yogurt, 1000g, Beihai Ranch's normal selling price is around 25.8 yuan, while Jianchun, a leading brand in domestic low-temperature yogurt with annual revenue exceeding 4 billion yuan, has dropped to around 16.3 yuan. This also means that on the road to pursuing scale economy effects, the gap between Beihai Ranch and large dairy companies will continue to widen, and it will face huge challenges in the fiercely competitive dairy red ocean. 3. Falling Behind Genki Forest's High-Speed Development Pace At a recent Genki Forest distributor conference, founder Tang Binsen disclosed that overall performance in 2025 achieved a 26% year-on-year growth, maintaining double-digit growth for three consecutive years, far higher than the FMCG industry average of 4.8%. Among them, sparkling water, electrolyte water, vitamin water, Chinese-style health water, and reduced-sugar tea became explosive categories. Although Beihai Ranch, with its 'small but beautiful' brand strategy and market positioning, has captured a small number of high-end users at the top of the pyramid, it also limits its product line coverage to a few channel forms such as JD.com self-operated, some high-end convenience stores, and Ole' premium supermarkets. This is in stark contrast to its previous deep terminal coverage in 144 prefecture-level and above cities, with over 10,000 convenience stores and 3,000 KA chain supermarket stores. Without large-scale distribution and widespread distribution models, scale effects are out of the question, and it misses opportunities brought by the rise of new channels, such as instant retail and bulk snack discount stores. Coincidentally, on December 1, Tiantu Capital announced plans to sell its indirect 45.22% stake in French yogurt noble brand Yoplait China for 814 million yuan. At the same time, other sellers and management will also transfer their shares. Clearly, the collective turn of investors suggests from another angle that the high-end yogurt dividend period has ended, and alternative products such as freshly made yogurt and freshly made ice cream have diverted demand. Besides competing with peers, Beihai Ranch and Yoplait also face the situation of competing on price with retailers' private labels. This places higher demands on product innovation, channel and consumption scenario expansion. At the same time, dairy industry giants, relying on scale advantages, can withstand short-term losses even in price wars. Emerging brands can neither break through with scale advantages nor compete with leading brands. In this competitive landscape, the awkward position, enormous operational pressure, and worrying sustained profitability are the epitome and true portrayal of yogurt nobles represented by Beihai Ranch and Yoplait, also reflecting the collective dilemma of high-end yogurt brands. Genki Forest's divestiture at this time should be considered a reasonable strategic choice. After all, value contribution is an eternal topic. In Conclusion When the industry dividend period arrives, most people will strive to seize the opportunity. But when the dividend fades, facing the industry's return to stability or a downward cycle, how to explore breakthroughs again? It should be about the courage to break the old and establish the new!