Source | New Products Finance & Economics
Low-profile Lao Gan Ma has achieved revenue growth for three consecutive years. Lao Gan Ma is still Lao Gan Ma, but the chili sauce industry players are in fierce competition, all wanting to become the next Lao Gan Ma.
Lao Gan Ma Quietly Rakes It In
In the consumer goods arena, internet-famous brands and hit products frequently emerge, often causing the market to overlook some old-brand products that are inexpensive and unassuming, yet are truly "hidden champions."
The author noticed that on December 6, the topic "Lao Gan Ma doesn't need innovation" briefly topped Baidu's financial hot search list, putting the well-known chili sauce brand into the spotlight.
According to Jiemian News, in the recently announced "2025 Top 100 Guizhou Enterprises" list, Lao Gan Ma ranked 57th with 2024 revenue of 5.391 billion yuan.
Lao Gan Ma is not a listed company, so its operating data is not publicly disclosed. However, this list revealed its revenue figures, which carry high credibility and authority, inevitably attracting attention and discussion.
Although Lao Gan Ma's ranking is not in the top 50, it's important to note that its products are chili sauce, which are inexpensive but sell in high volumes. Such high revenue surpasses that of many listed companies.
More notably, Lao Gan Ma has achieved revenue growth for three consecutive years. The report cited data showing revenues of 4.201 billion yuan, 5.26 billion yuan, and 5.381 billion yuan for 2021, 2022, and 2023, respectively.
According to public data, Lao Gan Ma's revenue peak was in 2020, reaching 5.403 billion yuan. This means its 2024 revenue is close to its peak performance.
From the perspective of a single company's operating data and growth, Lao Gan Ma's consecutive growth over the past three years suggests that its 2025 performance is likely to be decent as well.
In today's internet slang, one might say Lao Gan Ma is "winning by lying down" or "raking it in."
This is not the first time Lao Gan Ma's performance has been reported by the media. The author found that in December 2024, the "2024 Top 100 Guizhou Enterprises" list also led to media coverage of Lao Gan Ma's performance.
Last year, Red Star Capital Bureau, under Red Star News, cited the annual list and commented that Lao Gan Ma was climbing out of its trough.
Lao Gan Ma primarily produces chili sauce, a daily consumer product used for meals or cooking. Regardless of the time, consumers who like spicy food have likely eaten or even loved Lao Gan Ma.
So, why has Lao Gan Ma achieved three consecutive years of revenue growth? What has Lao Gan Ma done? What changes are happening in the chili sauce market behind its continued popularity?
Lao Gan Ma's Secrets Are Few
Lao Gan Ma operates in a very traditional food industry, and one could say the company has few secrets.
Founder Tao Huabi, an ordinary woman from rural Guizhou, opened a small restaurant at age 42 with her savings, specializing in cold noodles and cold jelly. To improve business, she carefully crafted eight chili sauces with different flavors. Surprisingly, the chili sauces became so popular that they sold even better than the cold noodles.
In 1996, Tao Huabi officially founded the Lao Gan Ma brand. With its unique flavors, the product gained increasing favor among consumers. The key to Lao Gan Ma's success lies in its genuine, high-quality chili sauce, which forms its true moat.
Thus, Lao Gan Ma gradually expanded from Guizhou to the national market. From 1998 to 2013, the brand experienced a golden period of rapid development, with annual sales peaking at 600 million bottles and products successfully sold to over 20 countries and regions.
According to media reports, during this period, Lao Gan Ma's annual output value surged from 50 million yuan to 3.8 billion yuan. More impressively, its market share once reached as high as 90%, making it a dominant player.
With its popularity, Lao Gan Ma gradually became a leading brand in the chili sauce industry, even a national brand. It became popular not only domestically but also internationally, becoming a necessity for many overseas students.
According to the "2024 China's 500 Most Valuable Brands" list released by World Brand Lab, Lao Gan Ma ranked 371st with a brand value of 22.279 billion yuan, up six places from the previous year.
Another core advantage that makes Lao Gan Ma a top industry player is its nationwide offline distribution network. Lao Gan Ma is available in all supermarkets, convenience stores, and other purchasing scenarios. Channel dominance remains a key strength.
Additionally, interestingly, Lao Gan Ma has ample cash flow, thanks to its model of collecting payment before shipping. It neither seeks financing nor goes public, appearing particularly "aloof."
Even today, Lao Gan Ma's position in the chili sauce industry remains unshakable. Jiemian News, citing data from offline retail monitoring agency MaxWin, reported that since 2022, Lao Gan Ma has held a market share of around 55% in the chili sauce category, dominating the market.
Despite its current dominance, Lao Gan Ma has faced challenges and even crises in recent years.
First, during the new consumption wave a few years ago, many new chili sauce brands emerged and encroached on Lao Gan Ma's market share, leading to a significant decline in its 2021 performance. However, many of these new brands quickly disappeared, and Lao Gan Ma regained its position.
Second, in 2014, Tao Huabi stepped back and handed over management to her two sons. They switched to chili peppers from other origins to cut costs, which altered the taste and sparked a "flavor change" controversy. In 2019, Tao Huabi returned to take the helm and stabilized the company.
Overall, Lao Gan Ma operates very low-key, quietly making profits. The latest media reports confirm this.
Chili Sauce Market Heats Up: Everyone Wants to Be the Next Lao Gan Ma
The media coverage of Lao Gan Ma's performance naturally draws attention to the chili sauce market, which is a multi-billion-yuan consumer market.
According to the "2025-2030 China Chili Sauce Industry Market Supply and Demand and Key Enterprise Investment Evaluation Research and Analysis Report," the Chinese chili sauce market reached 48.17 billion yuan in 2024, with a compound annual growth rate of 6.85% from 2017 to 2023, and is expected to exceed 50 billion yuan in 2025.
Currently, the competitive landscape of China's chili sauce industry has not changed significantly. As mentioned, Lao Gan Ma still holds over 50% market share, while the second-place brand has only a single-digit share.
According to media reports, in the third quarter of this year, among the top 5 SKUs (stock keeping units) in the Chinese-style condiment category, Lao Gan Ma occupied the top three spots, with the 280g fermented soya beans in chili oil holding 8.25%.
It is precisely because of Lao Gan Ma's explosive sales that it continues to attract various players of all sizes into the chili sauce market, all aspiring to become the next Lao Gan Ma.
As early as 2014, singer Lin Yilun founded the Fanye chili sauce brand, focusing on low-salt, healthy recipes, selling through e-commerce at higher prices.
With the rise of short videos, many livestream hosts, food bloggers, and cooking hosts have created their own chili sauce brands, such as Rishiji and Xiangji Ganfan Brothers, and they sell quite well.
In the past two or three years, some regional specialty chili sauces have also gained popularity, such as Minnan Gaozi chili sauce, Yuexi new chili sauce, and Hong Kong-style chili sauces sold by internet celebrities.
Competition in the chili sauce market is concentrated among several mainstream brands, such as Lee Kum Kee, Huaqiao, Lameizi, and Maodegong. In recent years, Chuanwazi has grown rapidly, standing out with popular products like burnt pepper sauce.
All chili sauce brands want to become the next Lao Gan Ma, with high brand awareness, high consumption frequency, high brand loyalty, and profitability like Lao Gan Ma.
Overall, the booming chili sauce market has seen new products with different regional flavors, leading to product and flavor diversification and enriching consumer choices.
However, from a competitive standpoint, despite numerous players, Lao Gan Ma's industry position remains unshakable in the short term and likely in the future.
Although Lao Gan Ma's secrets are few, and there have even been brands like Lao Gan Die (Lao Gan Ma's "father"), there is only one Lao Gan Ma, and it is hard to replicate.
Lao Gan Ma has left many business lessons for competitors and other companies, such as using genuine ingredients, maintaining stable quality, building a distribution network, keeping core products evergreen, occupying consumers' minds long-term, and even becoming synonymous with the industry. These require steady, step-by-step efforts.