---
title: "Impact of the Epidemic on FMCG: Investors Predict Opportunities in 2020 from Demand, Behavior, and Supply"
description: "Recently, in the New Distribution live room, we invited several well-known investors in the consumer goods field to discuss the changes and development trends in the food industry in 2020 under the shadow of the epidemic. The investors gave some very pertinent and practical suggestions, which we now share with you."
author: "赵波"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2020-02-25"
categories: "Capital, Earnings & M&A"
language: "en"
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original_source: "https://mp.weixin.qq.com/s/KvvvDrWAkluCoempEw9mqQ"
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citation: "赵波. “Impact of the Epidemic on FMCG: Investors Predict Opportunities in 2020 from Demand, Behavior, and Supply.” New Distribution, 2020-02-25. https://xinjignxiao.com/en/articles/impact-of-the-epidemic-on-fmcg-investors-predict-opportunities-in-2020-f-aea89417/"
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# Impact of the Epidemic on FMCG: Investors Predict Opportunities in 2020 from Demand, Behavior, and Supply

> Recently, in the New Distribution live room, we invited several well-known investors in the consumer goods field to discuss the changes and development trends in the food industry in 2020 under the shadow of the epidemic. The investors gave some very pertinent and practical suggestions, which we now share with you.

Recently, in the New Distribution live room, we invited several well-known investors in the consumer goods field to discuss the changes and development trends in the food industry in 2020 under the shadow of the epidemic. The investors gave some very pertinent and practical suggestions, which we now share with you.

**-01- Epidemic & Changes in Consumer Demand**

Although the epidemic has affected the entire market, overall, consumer goods are a super cyclical-resistant category with a low Engel coefficient. Therefore, consumer demand has not decreased; it is just that the supply and logistics side has been disrupted and thrown into chaos due to the epidemic. **The emergence of the epidemic will have an impact on some companies for one or two quarters, especially those in social consumption and service categories, but the overall impact is not significant.**

**Although the epidemic is temporary, it acts as a "catalyst," accelerating the process of some demands, behaviors, and industry supply and operational efficiency.** First, let's look at consumer demand and behavior.

It is foreseeable that consumers' demand for "health" will grow faster, especially in cleaning and hygiene categories, such as disinfectant wipes and disinfectant liquids, which will present huge market opportunities.

On the basis of health, **after the epidemic, it is foreseeable that "live poultry" may no longer enter large cities. Coupled with the younger consumer group's pursuit of both healthy and efficient lifestyles, categories such as frozen food, quick-frozen semi-finished products, and pre-made foods will see a major explosion.**

**-02- Epidemic & Changes in Consumer Behavior**

The above is from the perspective of health in consumer demand. Additionally, from the perspective of consumer behavior, during the month affected by the epidemic, the vast majority of people were forced to move online, typically for things like "buying groceries."

Which group is most affected by such consumption habits? Not the post-90s or post-95s, because they were already online in the past; they just increased their frequency.

**The most profound impact is on the post-60s, post-70s, and post-80s groups. The post-60s and post-70s were basically offline in the past, while the post-80s did planned consumption on Tmall and JD.com, and unplanned consumption (fresh vegetables, etc.) offline. After this epidemic, a considerable portion of their consumption has shifted online. This is a new growth point.**

Focusing on this core group, let's look at future changes in the restaurant market. In the past, in the restaurant industry, delivery accounted for only about 10-20%, while dine-in accounted for 80%. These consumers used to think that eating hot pot could only be done offline, as ingredients were not easy to obtain. But through this online experience, unless it is a social need, consumers can also eat at home by purchasing ingredients online or through delivery.

Based on this logic, **the future restaurant industry may present a tripartite situation: dine-in, delivery, and semi-finished product sales.** Of course, behind the changes in the industry, the operators behind it have also benefited. For example, behind Haidilao, their supply chain company Yihai International saw a surge in business volume, offsetting the losses caused by store closures during the epidemic.

**For post-70s and post-80s consumers, due to changes and shifts in consumption habits, it is certain that "online home delivery services" will see a blowout. This has given a group of "dying" new retail platforms a glimpse of new dawn.**

The epidemic has completed consumer education for new retail O2O companies, especially for the post-70s and post-80s, the mainstream and dominant consumer group in households. It can be said to have "given new life" to new retail enterprises.

**-03- Epidemic & Industry Changes**

The sudden attack of the epidemic caught companies off guard, especially in terms of response speed, which directly reflects **internal operational efficiency and external supply efficiency.**

First, regarding internal operational efficiency, we see that companies that had already adopted online cloud office systems early on were relatively less affected by the epidemic. Rapid organizational coordination minimized some of the losses caused by the objective environment.

It is foreseeable that **in the future, cloud office, cloud field management, and cloud communication, especially with the maturity of new technologies such as 5G, AI, and IoT, will gradually change the organizational form of enterprises.** The inefficient, centralized office format of the past, Taylor's pyramid organizational management model, can now and in the future be completely replaced by distributed, amoeba-style, or even external partnership-based organizational management.

Frankly speaking, the era of technology and intelligence has arrived. New biotechnology, new fermentation technology, the emergence of new ingredients and raw materials, and improvements in new production equipment and logistics facilities will greatly enhance production and operation efficiency, as well as food R&D efficiency.

On the external supply efficiency side, **one is the change in information transmission, bringing about a transformation in marketing methods; the other is the iteration and upgrade of supply chain technology.**

Communication technology has changed the way people communicate, which has also led to huge challenges for the traditional one-to-many, loudspeaker-style information communication methods of enterprises.

At this time, **whoever can seize the opportunity presented by new information communication methods will definitely rise rapidly in that field.** In the past, it was portal websites, Weibo, and e-commerce; now it is short videos, live streaming, and social fields. These new species have undergone essential changes compared to traditional marketing carriers.

From the consumer side, the first to try these new carriers are definitely young people. Enterprises should actively look at what young people are playing and watching. Embracing, learning, and applying them will surely not miss the development of the new era.

The iteration and upgrade of supply chain technology, the popularization of digital tools, and the application of IoT technology have made it possible for goods to achieve online, routing, informatization, and financialization during the flow process. Supply chain technology, on the one hand, improves the efficiency of commodity logistics and transportation; on the other hand, it also improves the environment for commodity distribution, greatly reducing losses.

**Summary:**

Of course, there are many trends. How to seize them specifically? It's simple: the starting point for thinking is nothing more than two ends: **

**On the demand side, we look at dividends.** Looking small, it's the dividend of demand changes under the epidemic; looking big, it's the stratified consumption brought about by China's demographic structural changes.

**On the supply side, we look at efficiency.** Whoever can achieve lower costs, higher efficiency, and better experience will definitely achieve rapid growth after this epidemic.

Many brand owners say, "Our industry's growth has reached its end." Actually, I don't see it that way. **The core topic in market positioning is market segmentation and differentiation.** Although traditional markets and demand have stopped growing, from the perspective of demographic structure, as long as we break down cities, income, age, interests, hobbies, behaviors, etc., finely enough, and combine them with specific scenarios, there are still plenty of opportunities. With a base of 1.4 billion people, even the smallest market segment can support sales.

Of course, the internal logic here is: **from consumer behavior, look at the underlying consumption logic; from consumption logic, look at the opportunities and problems behind it: market size, competitors, differentiation opportunities, and potential diverse consumer needs, and finally find your own niche market.**


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## Citation metadata

- Publisher: New Distribution
- Author: 赵波
- Published: 2020-02-25
- Canonical: https://xinjignxiao.com/en/articles/impact-of-the-epidemic-on-fmcg-investors-predict-opportunities-in-2020-f-aea89417/
- Original source: https://mp.weixin.qq.com/s/KvvvDrWAkluCoempEw9mqQ

## Copyright and AI use

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