The rapid growth of the food delivery industry has hit not the physical restaurant business hardest, but FMCG products like instant noodles and dried noodles! Introduction According to the National Business Daily, since 2013, instant noodle sales have declined for three consecutive years, dropping to 38 billion packets in 2016, 8 billion fewer than the peak. Instant noodles, once hailed as "the greatest invention of the 20th century," have thus "fallen." But under the dual pressure of delivery and instant noodles, the traditional handmade dried noodle industry is even more burdened. The Top Dried Noodle Company: Chen Keming Currently, the leading dried noodle company in China by market share is Chen Keming Noodle Industry, while in instant noodles, Master Kong leads, followed by Uni-President. From Baidu Index, we can see that in the past six months, Master Kong remains the industry leader, far surpassing Uni-President and Keming Noodle Industry in scale. ▲ Baidu Index screenshot: Chen Keming, Master Kong, Uni-President When adding Meituan delivery industry terms, we can clearly see that the six-month trend for Master Kong and Keming Noodle Industry is far below Meituan. From this perspective, Master Kong seems like an egg hitting a stone, and Keming Noodle Industry appears even more fragile and "tiny." ▲ Baidu Index screenshot: Chen Keming, Master Kong, Meituan Given the slow development of the dried noodle industry and intense competition, why has Chen Keming still built China's strongest dried noodle kingdom? This goes back to the entrepreneurial story of Keming Noodle Industry. In the early 1980s, Chen Keming, a skilled carpenter well-regarded in the surrounding areas, lost two fingers in a carpentry accident and had to put down his beloved hammer and saw to find another way to make a living. As the Hunan saying goes, Chen Keming "can endure hardship and is tenacious." He searched for a livelihood and finally picked up a rolling pin that wouldn't "hurt" him. The first step to making a living was solving food and drink. When he rolled out his first pot of noodle paste, he felt embarrassed and helpless, as he had only primary school education and didn't understand profound culture. He could only work hard. When he sought advice from a master, the master said, "It can only be understood, not explained." So he found a simple noodle-making book and, by candlelight with a pinyin dictionary, studied diligently. ▲ "Dried Noodle King" Chen Keming After reading the whole book, he realized a principle: "The most important thing for dried noodles is the quality of the flour; the rest depends on superb skill and thick-skinned sales! " With the principle clear, it was time to act. He applied his carpenter's attitude to making noodles, and within half a year, he became the most famous noodle master in the county. Customers came in droves, so he and his brother opened a factory together. He focused on product development and quality improvement; his brother handled sales and managed the staff. The brothers worked together with good reputation, raised considerable funds, and the factory gradually expanded, with production soaring. After 30 years of making dried noodles, Chen Keming finally delivered an impressive report card in 2016: annual production capacity of 300,000 tons, sales of 1.22 billion yuan, ranking first in the national dried noodle industry in capacity, sales, and market share. Sales also expanded from single dried noodle products to additional products: noodle seasoning sauce and mineral water. Why Can Chen Keming Prosper but "Sell Less" Than Instant Noodles? Chen Keming has prospered, but there are countless small workshops across the country, and there are countless "Chen Keming" dried noodle brands. Even the industry leader faces a severe development situation. As mentioned earlier, both dried noodles and instant noodles are FMCG products, but their growth rates differ greatly, mainly due to the following reasons: 1. Different macro environments. According to public data, dried noodles have gone through four development stages. Chen Keming's development period belongs to the third stage, which was also the dividend period and startup period for private dried noodle enterprises. ▲ Based on public data Standing on the shoulders of favorable times, growth and development naturally accelerate. Chen Keming Noodle Industry has gained a certain position and reputation in this field, so it can keep up with the times and continue developing in the fourth stage. However, the overall industry trend has actually changed significantly. 2. Dried noodles lack brand communication power and have limited audience. This is easy to understand: most people who love dried noodles are from the 70s and 80s generations, when family conditions were harder. In wheat-producing areas, wheat was processed into flour, then rolled into noodles as a staple food, which was low-cost and filling. Almost every northern household had a rolling pin, and everyone could roll out tasty noodles. Those who did better took a step further and opened small workshops, gaining local fame but remaining regionally fragmented. 3. A "slow" product in FMCG. This is the fundamental reason dried noodles "can't compete" with instant noodles. Instant noodles became a star product because you can have a fragrant, hot "dinner" in just two steps, similar to early fast-moving products like Synear dumplings, Wan Chai Ferry dumplings, and Sanquan tangyuan; or the new "lazy hotpot." These products only require boiling water and adding the product. Dried noodles, however, require mixing seasonings, boiling water, cooking the noodles, and washing dishes. So in the era of food delivery, having food with just a finger tap directly meets consumer needs. Where Is the Future of Dried Noodles? Currently, the domestic dried noodle market is still dominated by low-end products, with medium and high-end products accounting for less than 30%-50% of the total. Low-end dried noodles have a gross margin of less than 10%, medium-end around 20%, and high-end generally 30%-50%. As residents' per capita income rises, nutritious, healthy, and branded dried noodle products will gain a larger market. The main sales channels for dried noodle brands are large supermarkets and terminal markets, so consumption patterns are expected to shift toward: mid-to-high-end, nutritious, and healthy directions, and established leading enterprises will have more room to raise prices. Small workshops may gradually "disappear," providing basic technical R&D support for higher-grade dried noodles or focusing on "small but beautiful" quality brands. Those unscrupulous manufacturers or ordinary small vendors that cannot adapt to the times will exit the market due to lack of competitiveness. Source: Entrepreneur China (ID: cychina520) -END-