---
title: "Domestic Old Soda Brands Await Revival in the Scorching Summer"
description: "Every summer, soda drinks offer relief from the heat. In 1768, British chemist Joseph Priestley discovered a method to dissolve carbon dioxide directly in water, achieving the same cooling and thirst-quenching effect as mineral water, marking the beginning of the soda industry. In the early 20th century, many Chinese cities successively had their own beloved soda brands, from Beijing's Arctic Ocean to Hankou's No. 2 Factory Soda and Tianjin's Shanhaiguan. In the 1990s, these old brands were mostly acquired by foreign companies, hoping to leverage the strength of international giants to grow bigger and stronger, but their fate was often to be shelved."
author: "傅玺恩"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2024-05-17"
language: "en"
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---

# Domestic Old Soda Brands Await Revival in the Scorching Summer

> Every summer, soda drinks offer relief from the heat. In 1768, British chemist Joseph Priestley discovered a method to dissolve carbon dioxide directly in water, achieving the same cooling and thirst-quenching effect as mineral water, marking the beginning of the soda industry. In the early 20th century, many Chinese cities successively had their own beloved soda brands, from Beijing's Arctic Ocean to Hankou's No. 2 Factory Soda and Tianjin's Shanhaiguan. In the 1990s, these old brands were mostly acquired by foreign companies, hoping to leverage the strength of international giants to grow bigger and stronger, but their fate was often to be shelved.

Another summer has arrived, and it's time for soda to cool us down. In 1768, British chemist Priestley created a method to dissolve carbon dioxide directly in water, achieving the same cooling and thirst-quenching effect as mineral water, marking the beginning of the soda industry. In the early 20th century, many cities in China successively had soda brands loved by local citizens, from Beijing's Arctic Ocean to Hankou's No. 2 Factory Soda and Tianjin's Shanhaiguan. In the 1990s, these old brands were mostly brought under foreign ownership, hoping to use the strength of international companies to grow bigger and stronger, but their fate was often to be shelved.

It wasn't until recent years, under the wave of national trend (guochao), that these old soda brands revived. However, many are mainly active in specific channels like catering, and it's still a long road to fully compete with the international giants that once put them at a disadvantage. Moreover, beyond nostalgia, whether they can continue to be loved by young people will be tested by one summer after another.

**The Origin of China's Old Sodas:**
**Many Cities Once Had Their Own Memories** Writer Jia Pingwa once said: "A person's stomach has a memory function; the foods one loved in youth leave a deep imprint on the taste buds." Zhang Zhao, 42, has run a small shop on Gulou Street in Beijing for thirty years, and the best-selling items in summer are Arctic Ocean and red bean popsicles. In his memory, when his grandfather was alive, he loved to sit under the big locust tree in front of the house, drinking Arctic Ocean while eating fermented bean curd, recounting stories of old Beiping. [Image: Arctic Ocean, the summer memory of several generations of Beijingers] Time travels back to 1936, when a businessman named Wang Yusheng invested in Tianqiao Luchang Street in Beiping to open a private **Beiping Ice Factory**. With a dozen workers cutting ice from Taoranting's frozen surface in winter and storing it in the icehouse for summer sale, the business was profitable. The following year, it was renamed "China Ice Factory," which was the predecessor of Arctic Ocean. However, just half a year later, the July 7th Incident broke out, and the factory was forcibly "leased" by Japanese merchants. After Japan's surrender, it closed in September 1947 due to insolvency. After the founding of New China, the factory was nationalized and given a new name—**"Beijing New Construction Ice Factory"**—becoming one of the founding enterprises of China's beverage and cold food industry. In 1951, the factory began producing soda and officially registered the "Arctic Ocean" trademark. From then on, the vintage glass bottles, the cute and chubby white bear, and the orange-yellow core were deeply imprinted in the hearts of old Beijingers, covering the summers of several generations.

[Image: Do you still remember these old sodas?]

In central Wuhan, the most memorable for old Hankou residents is **"No. 2 Factory Soda"**. In the winter of 1891, British man **Walter Hughes Cossain** saw that ice was popular among foreigners in the Hankou concession during the hot summer, so he founded **Heli Ice Factory** in Hankou and tried to introduce British new technology to make ice. In 1938, when Japanese troops invaded Wuhan, Cossain was injured in a car accident and left hastily. Hankou businessman **Liu Yaotang** took over Heli Ice Factory, made domestic soda, and successfully developed "Vita Cola," which sold well. Liu Yaotang even once wanted to introduce "Pepsi-Cola," but the times disrupted everything. A small bottle of soda witnessed the artillery fire of the War of Resistance Against Japan. At Wuhan's most critical moment, Heli Ice Factory, located in the French Concession, became a temporary shelter for citizens. When the Japanese cut off the water supply, it was Heli Ice Factory that provided life-saving water to refugees. In 1952, Liu Yaotang accepted public-private partnership, and Heli Ice Factory was transformed into the state-owned Wuhan Beverage No. 2 Factory. The Heli brand became the **Binjiang brand**, and from then on, Binjiang soda was affectionately called **"No. 2 Factory Soda"** by Wuhan people.

As the economic and financial center of the north during the Nationalist government era, Tianjin people also have their own soda memories. In 1902, a British merchant saw a business opportunity in the lucrative "Dutch water" (soda was introduced during the Tongzhi reign of the Qing Dynasty and called Dutch water) and invested in Tianjin to establish Wanguo Soda Company, which was the predecessor of **"Shanhaiguan"**. In the early years of the Republic of China, it had already become a fashionable drink in Tianjin. When Puyi married, it even became a "guest of honor" with royal endorsement. After 1953, it was nationalized and renamed the state-owned Tianjin Shanhaiguan Soda Factory, carrying the memories of countless Tianjin people.

Other representative local sodas include Shenyang's famous time-honored brand—**Bawangsi Soda**, founded in 1920 by national capitalists such as Zhang Huilin, chief auditor of the Northeast Official Bank, and Jin Enqi, chairman of the Fengtian Chamber of Commerce. After the September 18th Incident, it was seized by the Japanese army and renamed "Fengtian Bawangsi Brewing Industry Co., Ltd.," with most products shipped back to Japan for sale. After the founding of New China, it adopted public-private partnership and was renamed "Shenyang Bawangsi Soda Factory." There is also **Bingfeng**, the first soda factory in Xi'an, founded in 1948. Bingfeng, cold noodles, and roujiamo are the "Sanqin set meal" engraved in the souls of Shaanxi people. [Image: The legendary Sanqin set meal]

Guangzhou's old soda is the Guangzhou Asia Soda Factory, founded in 1930, with its first product called Asia Sarsaparilla. This drink, often dubbed by netizens as "the worst-tasting beverage in history," smells like essential oil, but in the hearts of Cantonese people, Asia Sarsaparilla is like the yellow peach canned food for Northeasterners. [Image: Asia Sarsaparilla]

After the founding of New China, domestic cola also became an important part of the soda industry. In 1953, Laoshan Cola was established in Qingdao, the first carbonated beverage independently developed in China, made from natural Laoshan mineral water with the addition of more than ten Chinese herbal ingredients such as jujube, Angelica dahurica, amomum villosum, galangal, clove, and rich carbon dioxide gas. In 1981, Tianfu Cola, developed in Chongqing, was also famous for a time. There is also Dayao Soda, founded in Inner Mongolia in 1996, and Dandong Big Banana Soda and Harbin Big White Pear Soda, which were popular in the Northeast during the same era—all are memories of a generation.

However, these children of history suffered a heavy blow at the end of the last century.

**International Giants' Acquisitions**
**Once "Flooding the Seven Armies"** In the 1990s, under the background of encouraging the use of foreign investment to transform old enterprises, Coca-Cola and Pepsi-Cola began their long march into China. Starting in 1994, Coca-Cola and Pepsi-Cola successively acquired seven soda factories: Beijing Arctic Ocean, Guangzhou Asia Soda, Chongqing Tianfu Cola, Shenyang Bawangsi Soda, Qingdao Laoshan Cola, Wuhan Hankou No. 2 Factory, and Tianjin Shanhaiguan. At first, there was a period of coexistence between domestic sodas and foreign capital. But over time, the intentions of the international giants began to show. The final result was that domestic sodas were not made bigger and stronger by foreign capital, but instead were shelved, their market share shrank continuously, and they eventually disappeared, lamented by public opinion as "water flooding the seven armies." [Image: Old soda brands]

A veteran worker of the Arctic Ocean factory recalled that the "Arctic Ocean Chronicle" clearly recorded that in 1998, Arctic Ocean completed a total industrial output value of 104.942 million yuan, sales revenue of 132.026 million yuan, the highest level in history, with profits and taxes totaling over 20 million yuan. At that moment, it was the most glorious time before the acquisition. However, "unexpectedly," Pepsi-Cola did not follow the acquisition plan and contract provisions to grow the Arctic Ocean brand, but instead adopted an extreme method to shelve it.

In 1990, the state-owned Wuhan Beverage No. 2 Factory was also acquired by Coca-Cola and shelved. Subsequently, No. 2 Factory Soda faded from public view. In 1993, Guangzhou Asia Soda Factory entered into a joint venture with Pepsi-Cola, entering a shelving period of nearly ten years. From 1993 to 2003, the American Coca-Cola Beverage Company merged "Bawangsi" and sealed the "Bawangsi" trademark for 10 years. In 1994, Chongqing Tianfu Cola cooperated with Pepsi-Cola and was gradually marginalized. In addition, Qingdao Laoshan Cola and Tianjin Shanhaiguan all suffered the same "treatment" without exception.

In fact, these operations by foreign capital were not only staged in the soda industry. Take **Hubei Shashi Vital 28 washing powder**, which was the advertiser for the 5 seconds before "News Broadcast" in 1995 and the first domestic washing powder brand to advertise in Central, Hong Kong. It was also sold to the German chemical giant Meister in the 1990s, and the result was that it was "operated" by the German company all the way, such as drastically raising the price of Vital 28, while the German brand attacked cities and territories at low prices domestically. In 2006, Vital 28 completely stopped production, and it wasn't until last year's live-streaming event that netizens remembered it again.

Originally hoping to be made bigger and stronger by foreign capital, they were instead swallowed up. **This is a lesson learned and tuition paid on the road of China's industrial growth.** Fortunately, with efforts from all sides, these children of history finally saw a turning point in their fate in this century. [Image: After a series of operations, cola occupied the stomachs of a new generation]

In 2002, the Chinese side recovered the Asia Soda Factory from PepsiCo; in 2004, Qingdao Laoshan Mineral Water Company redeemed the Laoshan Cola brand and made a comeback; in November 2011, Arctic Ocean, which had disappeared for over a decade, returned to the market, which was exciting. In 2015, Shenyang Bawangsi finally restored the old soda taste from over 30 years ago. Later, Chongqing Tianfu Cola Group Company "demanded back" the brand from Pepsi, and through judicial recovery and other means, recovered the formula, production process, and brand of Tianfu Cola from Pepsi, and regained the trademark. On January 6, 2016, Tianfu Cola officially announced its brand comeback. After many years, these time-honored soda brands finally "came home" one by one.

**Under the National Trend**
**Domestic Sodas Still Lack Core Competitiveness** In the past decade, with the rise of the national trend and the younger generation re-evaluating the value of national brands, this has brought opportunities for domestic soda brands to grow bigger and stronger. From January to August last year, Meituan released data showing that the instant retail sales of eight major domestic sodas, including Shanhaiguan, Bawangsi, Arctic Ocean, Laoshan Soda, Tianfu Cola, and Zhengguanghe, increased by 41% year-on-year. At the same time, these time-honored brands are no longer confined to one corner but are accelerating their national layout. For example, from January to August last year, Guangzhou's Asia Soda saw a 34% increase in sales outside the province, Qingdao Laoshan Soda saw a 38% increase in sales outside the province, and Arctic Ocean's instant retail orders outside Beijing accounted for as high as 60%.

In the public opinion arena, these sodas easily trigger traffic as long as they are slightly associated with the national trend. For example, in 2023, Tianfu Cola rushed to the hot search due to misleading topics like #Tianfu Cola applies for bankruptcy#, and many people regretted that they would never drink Tianfu Cola again, so they started placing crazy orders, causing sales on Taobao stores to surge by 30 times in a period. These all show that **time-honored brands have broad public support and great potential.**

Some businessmen have also discovered business opportunities and staged new wealth stories, one representative being Wuhan's No. 2 Factory Soda. On March 24 this year, the WeChat account of Hankou No. 2 Factory issued a statement that drew public attention to No. 2 Factory Soda. The statement said, "The Hankou No. 2 Factory Soda brand has nothing to do with Mr. Lan Shili and the 'Wuhan No. 2 Factory Soda' that appeared on the market in 2023." Suddenly, the public realized that in just a few years, a city had three No. 2 Factory Sodas. As mentioned earlier, the historical No. 2 Factory Soda was originally named Binjiang Soda, produced by Wuhan State-owned Beverage No. 2 Factory after 1949, and has been discontinued for over 30 years. The Hankou No. 2 Factory that issued the statement was a "No. 2 Factory Soda" replica created by Wuhan native Jin Yawen at the end of 2017, named "Hankou No. 2 Factory," which awakened the collective memory of Wuhan people through nostalgia and was once a bestseller. According to media reports, in 2021, the annual sales of No. 2 Factory Soda reached 300 million yuan. [Image: Nostalgia once became the easiest element to monetize]

The "Wuhan No. 2 Factory Soda" that Hankou No. 2 Factory clarified about was founded by **Lan Shili, the former richest man in Hubei**. In 2023, after regaining freedom, Lan Shili smelled a business opportunity, launched the soda brand "Wuhan No. 2 Factory," and quickly seized market share with low prices. In 2023, Lan Shili publicly stated that he would achieve sales of 100 million yuan that year. Even more splendid was Lan Shili's capital operation. On October 19, 2023, Wuhan No. 2 Factory Soda was listed on the Hong Kong capital market through acquisition, becoming a main board listed company on the Hong Kong Stock Exchange, packaged as "China's first soda stock." But in reality, whether it's Jin Yawen's "No. 2 Factory Soda" or Lan Shili's "Wuhan No. 2 Factory" soda, they have nothing to do with the Binjiang Soda in the hearts of many old Wuhan people. However, the development paths of the two brands show that as long as the nostalgia marketing of time-honored brands is in place, it can touch people's hearts.

It's not just No. 2 Factory Soda that has regained momentum from the national trend. Inner Mongolia's **Dayao Soda**, through strategies such as launching affordable 550ml large bottles and hiring Wu Jing as spokesperson, achieved annual revenue of 3.2 billion yuan in 2022, becoming an industry leader. This year, Dayao Soda will add two new factories in Tai'an, Shandong, and Baoji, Shaanxi, with plans to start production in May and June. Arctic Ocean, on the other hand, has created 12 trendy stores, launched more flavor and texture products including HPP (ultra-high pressure cold sterilization) juice, fresh orange juice soda, Dan tea, and orange yogurt, and promoted IP collaborations, successfully attracting young people to check in and consume. Media reports say that Arctic Ocean's sales were 600 million yuan in 2018 and reached 1 billion yuan in 2023. [Image: Arctic Ocean's trendy stores]

Of course, overseas brands are not built in a day and still have strong strength. Currently, Coca-Cola and Pepsi-Cola still occupy 90% of China's carbonated beverage market. **Both brands' global sales in the first quarter of this year are still growing, exceeding industry expectations.** Coca-Cola Company achieved revenue of 81.824 billion yuan in the first quarter of 2024, a year-on-year increase of 3%. Among them, sparkling beverages and juice categories performed particularly well, with sparkling beverage sales growing 2% globally, and Coca-Cola Zero achieving 6% global growth. Meanwhile, on April 23, PepsiCo announced its first-quarter financial report, with net revenue of $18.25 billion, a year-on-year increase of 2.7%, exceeding expectations by 0.4%, and net profit of $2.042 billion. International business sales grew 9%, with emerging markets such as Mexico, Brazil, China, and Australia achieving double-digit revenue growth.

In contrast, time-honored brands still have a significant gap with international brands in terms of cost, product innovation, and revenue scale. This is reflected on the consumer side: many people report that the new products in the trendy stores of time-honored brands are not cheap, channel sales rely heavily on catering, and they are rarely seen in other consumption scenarios. Product innovation also has room for improvement. There are even counterfeit products of time-honored brands flooding the market, causing psychological burden for consumers when purchasing.

Nostalgia consumption will eventually end. How to seize the opportunity to grow bigger and stronger is a common topic for all old soda brands. An industry insider said that the current overall environment is returning to rational consumption, and these time-honored brands still need to work hard on the internal skills of cost, product, and sales system to truly build a solid foundation and gain the core competitiveness to truly compete with international giants.

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