Some media say the 'Jiangxi clique' dominates China's internet-famous pastry circle, but looking at Fujian, they have 'dominated' the snack food industry for years. It is well known that Fujian people love doing business and are good at it. In the 1950s, from Fuzhou's Minjiang Wharf to Quanzhou, scenes of dilapidated fishing boats with a few fishing nets were common, as old fishermen carried shoulder poles and came ashore. 'No tile above, no land below, living on boats, drifting forever' was the life of farmers at that time. Limited natural conditions 'forced' Fujian people into business. Based on fishing, clever Fujianese discovered many business opportunities. Especially in the snack food industry, brands like Daliyuan, Panpan, Yake, and Qinqin on shelves became childhood tastes for the post-90s generation, and with humble snacks like potato chips, egg yolk pies, and jelly, they also created many Fujian millionaires. Unlike many internet-famous brands, many Fujian FMCG companies today seem outdated in management, with 'earthy' packaging, and not favored by today's youth, but these companies are down-to-earth and steady, quietly making big money. Some media say the 'Jiangxi clique' dominates China's internet-famous pastry circle, but looking at Fujian, they have 'dominated' the snack food industry for years. Business acumen etched in the bones Along the coast of Fujian, sayings like 'If you don't strive when young, you'll have no fame when old' and 'Lose to others but not to the lineup; losing the lineup is shameful' are common. Under the influence of business traditions, 'starting a business and being the boss' has become one of the value orientations of Fujian people. The rapid development of Fujian's food industry is inseparable from the long-standing Min merchant culture. 'Originating in the Han and Tang dynasties, flourishing in the Song and Yuan; continuing in the Ming, declining in the late Qing; reviving with reform and opening up, and booming today.' The footprints of Min merchants span ancient and modern times. Since the Tang Dynasty, merchant groups known for overseas trade settled in places like Quanzhou, Fujian. During the Southern Song and Yuan dynasties, Quanzhou had trade relations with over 100 countries and regions, becoming one of the world's largest commercial ports. Zheng He's multiple voyages from Fujian also boosted economic development. Thus, the business consciousness of Fujian people has been passed down from generation to generation. The truly modern Min merchants rose in the latter half of the 19th century. Under the social and economic environment of the Ming Dynasty, relying on the developed local handicraft industry, Min merchants began large-scale domestic and overseas trade activities. The rise of the Westernization Movement in the Qing Dynasty further promoted the development of Fujian's industry. The establishment of the first modern higher industrial school in China, the Fujian Shipbuilding School, cultivated the first batch of new intellectuals with Western knowledge. Their new knowledge and technology laid the foundation for the later development of Min merchants. However, from the late Qing to the founding of New China, due to turbulent times, Fujian fell into a state of ruin. At the beginning of New China, Fujian's economy was very backward, ranking 23rd in GDP nationwide. Just as Fujian was at a loss, a group of overseas-returned Min merchants came to the rescue, building batches of buildings, hospitals, and stadiums. However, the power of private investment was limited, and state-owned enterprises remained an important pillar of economic development. Fujian's resurgence came in 1979. As a coastal province, Fujian has quality trading ports like Quanzhou and Xiamen. After the reform and opening up, once policies were relaxed, Fujian's advantages immediately emerged. Foreign and Taiwanese capital flowed in, promoting the formation of labor-intensive industrial clusters such as textiles and clothing. In the first decade after reform and opening up, Fujian's GDP jumped from 7.411 billion yuan to 45.84 billion yuan, rising to 14th in the country. Having tasted success, Fujian's industry developed even faster, and local Fujian people also plunged into business, starting ventures, gradually forming industrial clusters for shoes, hats, clothing, and food. From 1978 to 1992, a batch of township enterprises appeared along the coast of Fujian. Especially in the Jinjiang area, it became famous nationwide for 'every family running a factory, every household emitting smoke,' and Jinjiang's food industry also started from there. In 1979, 13-year-old Ke Yongkai, along with his father and several brothers, used their hard-earned savings to set up a cannery in Jinjiang, producing fish-skin peanuts, fruit cans, etc. After completing the primitive accumulation of capital, the Ke family considered transformation and development, and five years later decided to switch to producing leisure foods like candy and jelly, thus establishing Fuma Food. However, transformation required huge capital investment. Just as the Ke family was at a loss, Malaysian and French investment companies successively joined. The successfully transformed Fuma Food continued to innovate, developing and producing milk drinks, chocolate, potato chips, and other snacks. In 1985, Chen Qingshui and Chen Qingyuan brothers from Matang Village, Xiamen, Fujian, rallied four other young villagers to raise 30,000 yuan and jointly founded a village-run factory, which was the predecessor of Yinlu. During the same period, Xu Shihui, who had been engaged in the leisure food industry in Hui'an, Quanzhou, established Hui'an County Minzheng Meili Food Factory in 1989, which was the predecessor of Dali Foods. Hui'an, as one of Quanzhou's subordinate counties, has a golden coastline of 192 kilometers. Besides titles like 'Coastal Zou Lu' and 'Strong Fishery County,' it is also rated as a 'Strong Food Industry County' and ranks third in comprehensive county competitiveness in Fujian Province. Yinlu once achieved annual sales exceeding 5 billion yuan in 2010, creating the 'Eight Treasure Porridge Myth.' Dali Foods is even more impressive, with annual sales now exceeding 22 billion yuan. Xu Shihui has long held the title of Quanzhou's richest man and even became Fujian's richest man at one point. In 2014, Jinjiang's leisure food exports exceeded the 100 million US dollar mark for the first time, a new milestone in the industry. Today, Quanzhou has become Fujian's largest and an important national export base for leisure foods. Some describe Min merchants: Wherever there are people in the world, there are Chinese; wherever there are Chinese, there are Min people. 'Earthy' foods support Fujian's hundred-billion-yuan industry On the land of the Min River, the aroma of butter and milk wafts everywhere. The 1980s and 1990s were the era when Fujian's snack baking industry rose. Since Fuma Food, Daliyuan and Panpan were also 'born' during this period. Potato chips, fries, jelly—these food companies kept trying new leisure food categories. It wasn't until 2003 that the small dessert egg yolk pie further 'rolled' these household names into the national spotlight. From Kebike to egg yolk pie was Xu Shihui's first step towards becoming a food tycoon, and it was also by relying on 'affordable alternatives' that he conquered the market. In 1997, South Korea's Orion entered China, starting to produce and sell Orion pies. By 2002, its sales reached 250 million yuan. At that time, Orion leaned towards a high-end route and found it hard to penetrate lower-tier markets. Reacting quickly, Dali Foods launched its affordable alternative—Daliyuan egg yolk pie—in 2002. Soon, Fuma and Panpan followed suit. After the 'egg yolk pie craze,' in 2005, a new industrial bread with a shelf life of over 6 months—French-style mini bread—began its journey in China. Although Sanhui was the first to focus on promoting French-style mini bread, it was Panpan Foods that truly changed its 'fate.' Panpan first spent heavily to invite actress Jiang Wenli as spokesperson, and the slogan 'French-style mini bread, Panpan is still the best' was everywhere, momentarily stealing the limelight from egg yolk pies. It is understood that after successfully getting a 'piece of the pie' of French-style mini bread, Panpan's revenue expanded rapidly by over 300%. Star products naturally attract peers to swarm in. According to statistics, from 2006 when French-style mini bread began to emerge to 2008, its total market volume exceeded 10 billion yuan. Besides Panpan and Dali, even the new Jinjiang compatriot 'Youchen' came to share the cake. But Youchen's breakout was not through mini bread, but through the traditional Chinese snack 'pork floss cake,' which originated in the sixth year of Xianfeng in the Qing Dynasty. The founder of the Youchen brand, You Linghua, is precisely the inheritor of the 'You family' who invented the pork floss cake. According to legend, during the Xianfeng period of the Qing Dynasty, Lin Dingding, the chef of Fujian Salt Transport Commissioner Liu Buxi, accidentally overcooked the pork while cooking. To make up for the mistake, he added various seasonings and stir-fried the meat into powder to serve. Unexpectedly, the host and guests were amazed by the taste. During the Guangxu period, Lin Dingding's descendants moved to Fu'an, Ningde, and became close friends with the neighboring You family. The You family had long run a handmade pastry shop. Once, the Lin family entertained the You family with their exclusive secret pork floss, which inspired the You family to combine pork floss with pastries. Over time, the You family's pork floss cakes became a local specialty. Youchen's pork floss cakes became popular, and pork floss cakes also became a sought-after product for various food companies. For 40 years, the competition and innovation in Fujian's baking industry have never stopped: old enterprises like Fuma, Dali, and Panpan continuously keep up with the times and upgrade; 'post-00s' enterprises like Huitouke and Youchen enter with single products, striving for long-term survival. Whether new or old brands, they maintain parallel progress in product innovation, and the 'passing on' spirit is vividly reflected in category innovation. Once a new single product is developed, it is quickly replicated. Single products like hand-torn bread, pork floss cakes, waffle cakes, and sandwich bread cover almost all brands. Not only pastries, but candy is also a core industry in Fujian, and Jinjiang is also known as the 'Capital of Candy.' It got this title because Fujian's largest candy manufacturer, 'Yake,' is located there. The rapid development of Fujian's pastry and candy industry is mainly due to the strong local customs' demand for candy and pastries. Whether for seasonal festivals or family happy events, people are accustomed to giving candy and pastries as gifts. Over time, households' standards for choosing candy and pastries have gradually converged. To gain more market share, brands have also launched products that cater to consumer preferences. The renewal of the baking industry not only relies on category innovation, but also on new brands emerging from the internet that are subverting the traditional Fujian baking industry. Escaping small shops, conquering e-commerce If the 1990s were the first peak of Fujian's leisure snack industry, then 2016 marked its second peak. Just as the entire baking industry was in a bottleneck, in 2016, Cai Yiyong left the family food business—Caiji Food—and founded his own food company, 'Mulanka.' The brand 'Xiaobai Xinli Ruan' quickly swept e-commerce platforms and became a new internet-famous brand in the baking industry. In 2018, Xiaobai Xinli Ruan's total sales across all channels exceeded 400 million yuan, with net profit reaching 50 million yuan. In 2021, its pioneering 'milk-skin white bread' exceeded 10 million yuan in sales within two months of launch, sparking a 'milky wave.' By 2022, Xiaobai Xinli Ruan launched 'milk-skin white cake,' and within a week of going online, offline orders exceeded one million. It is worth mentioning that convenience stores that 'senior' Panpan couldn't enter, Xiaobai Xinli Ruan not only entered but also sold well, with its presence in chain convenience stores like Lawson, 7-Eleven, and FamilyMart. 'Short-shelf-life baked goods like Xiaobai Xinli Ruan often meet immediate consumption needs, suitable for convenience stores, fruit shops, and also fit with more fragmented new channels like unmanned shelves and vending machines,' Cai Yiyong once said. Short-shelf-life foods allow new brands to 'catch up' with old ones. The small bread developed 20 years ago is now being innovated and improved by new baking brands like Xiaobai Xinli Ruan. Fresh and non-greasy taste, low sugar, low oil, low calories, and no preservatives—short-shelf-life bread has become a new demand for young consumers today. Besides health, satiety, and deliciousness, IP creation has also become a focus for this new generation of brands. Xiaobai Xinli Ruan has also started producing comics, emojis, and peripheral merchandise to suit young consumers' habits. Besides Xiaobai Xinli Ruan, a1 Snack Research Institute is also a rising star of the 'class of 2016.' Within less than four years of establishment, it secured five rounds of financing, each in the hundreds of millions, with 'Queen of Venture Capital' Xu Xin investing three times. It is understood that a1 Snack Research Institute currently has multiple hit products like a1 Cloud Cake, Egg Yolk Crisp, and Watermelon Toast, and includes over 300 SKUs across categories such as baking, nuts, meat products, and fruits and vegetables. Unlike the old brands, a1 Snack Research Institute has an omni-channel layout online and offline. Guanchao New Consumption (ID: TideSight) learned that a1 Snack Research Institute has completed cooperation with over 100 online platforms. Offline, it is divided into two types: one covers over 500 outlets, including Walmart, Yonghui, and China Resources; the other is self-operated membership stores, using a membership model to connect online and offline traffic and achieve a direct-to-consumer (D2C) model. Although it is a new brand, a1 Snack Research Institute still carries the genes of old Fujian enterprises. Founder Zhou Weiping once served as marketing general manager for several groups like Yake and Fuma, having worked in the food industry for over a decade. This also means that a1 Snack Research Institute and Yake, despite crossing eras, still share similarities. From Panpan and Dali to Huitouke and Youchen, and then to a1 Snack Research Institute and Xiaobai Xinli Ruan, each stage of new brand emergence brings a hit product that ignites the era. Just as the post-80s and post-90s are accustomed to shelves in small shops and traditional supermarkets stocked with potato chips, small bread, waffle cakes, etc., for today's young people, sandwich toast and egg yolk crisps on e-commerce platforms are also attractive. Conclusion Over 30 years, China's leisure food industry has undergone 4.0 iterations. Brand nostalgia is hard for young consumers to relate to; in comparison, product quality and cost-effectiveness are more appealing to consumers. According to iMedia data, from 2010 to 2021, the market size of China's leisure food industry grew from 410 billion yuan to 1.1562 trillion yuan, with an expected growth rate of 7.2% in 2022, reaching a market size of 1.2391 trillion yuan. Facing the aggressive market situation, new brands think about how to quickly enter the market and become popular, while old brands think about how to continue surviving steadily. Just like last year, the long-silent Yake suddenly reappeared in the form of braised products and functional drinks, trying to ride the wave of braised food and functional bottled water that are currently hot among capital and consumers. However, in terms of competitiveness, the gap with new brands like Wangxiaolu and Waiwaixing is still large. Compared with today's hugely popular Momo Pastry Bureau, Hutou Bureau, and Luxihe, pre-packaged pastries seem overshadowed, but their sales behind the scenes are still growing. Traditional enterprises lower their profiles, internet-born enterprises return to the physical world, and the core of all participants' efforts is returning to the essential needs of consumers. Source: Guanchao New Consumption (ID: TideSight) -END-