---
title: "This Hunan Brother Duo, Relying on Small Spicy Strips, Aims for IPO: Annual Sales of 4.9 Billion"
description: "Another 'national snack' is about to knock on the door of IPO. According to the latest report from Reuters IFR, Weilong Food is working with CICC, Morgan Stanley, and UBS to plan a Hong Kong IPO in 2021, aiming to raise $1 billion. However, Weilong has not commented on this. Weilong is famous nationwide for its spicy strips. In 1999, 21-year-old Liu Weiping from Pingjiang, Hunan, ventured to Luohe, Henan. With only a high school diploma, he led his younger brother Liu Fuping and fellow townspeople from a small workshop making gluten snacks, eventually building a vast spicy strip empire—in 2019, Weilong achieved revenue of 4.909 billion yuan."
author: "张继文 周佳丽"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2020-11-26"
language: "en"
canonical: "https://xinjignxiao.com/en/articles/this-hunan-brother-duo-relying-on-small-spicy-strips-aims-for-ipo-annual-2e90906d/"
markdown: "https://xinjignxiao.com/en/articles/this-hunan-brother-duo-relying-on-small-spicy-strips-aims-for-ipo-annual-2e90906d.md"
original_source: "https://mp.weixin.qq.com/s/qlSFcDoYqurQ-wd-Ys2FVQ"
translation: "https://xinjignxiao.com/zh/articles/%E8%BF%99%E5%AF%B9%E6%B9%96%E5%8D%97%E5%85%84%E5%BC%9F-%E9%9D%A0%E5%B0%8F%E5%B0%8F%E8%BE%A3%E6%9D%A1%E5%86%B2%E5%87%BBipo-%E4%B8%80%E5%B9%B4%E5%8D%9649%E4%BA%BF-2e90906d.md"
attribution: "New Distribution — https://xinjignxiao.com/en/articles/this-hunan-brother-duo-relying-on-small-spicy-strips-aims-for-ipo-annual-2e90906d/"
usage_policy: "https://xinjignxiao.com/ai-policy.txt"
---

# This Hunan Brother Duo, Relying on Small Spicy Strips, Aims for IPO: Annual Sales of 4.9 Billion

> Another 'national snack' is about to knock on the door of IPO. According to the latest report from Reuters IFR, Weilong Food is working with CICC, Morgan Stanley, and UBS to plan a Hong Kong IPO in 2021, aiming to raise $1 billion. However, Weilong has not commented on this. Weilong is famous nationwide for its spicy strips. In 1999, 21-year-old Liu Weiping from Pingjiang, Hunan, ventured to Luohe, Henan. With only a high school diploma, he led his younger brother Liu Fuping and fellow townspeople from a small workshop making gluten snacks, eventually building a vast spicy strip empire—in 2019, Weilong achieved revenue of 4.909 billion yuan.

****Click 'Read the original' for details****
Another 'national snack' is about to knock on the door of IPO.
According to the latest report from Reuters IFR, Weilong Food is working with CICC, Morgan Stanley, and UBS to plan a Hong Kong IPO in 2021, aiming to raise $1 billion. However, Weilong has not commented on this.
Weilong is famous nationwide for its spicy strips. In 1999, 21-year-old Liu Weiping from Pingjiang, Hunan, ventured to Luohe, Henan. With only a high school diploma, he led his younger brother Liu Fuping and fellow townspeople from a small workshop making gluten snacks, eventually building a vast spicy strip empire—in 2019, Weilong achieved revenue of 4.909 billion yuan.
'Not all spicy strips are Weilong.' This is the slogan on Weilong's official website. With the growth of Weilong and others, the Henan spicy strip industry has risen accordingly, occupying half of the national spicy strip market.
**Zhou Hei Ya, Lai Yifen, Baicaowei, Three Squirrels, Liangpin Shop, Ganyuan Food... In recent years, with the help of foodies, 'national snacks' have flocked to the IPO stage. In the capital market, the team of leisure food is growing.**
**-01-** **After 20 years of entrepreneurship, this Hunan brother duo started from scratch. The best spicy strips sell 4.9 billion yuan a year.**
Once a simple small workshop, it has created today's Weilong.
In 1978, Liu Weiping was born in Pingjiang County, Hunan Province. This small county in the mountains has a long history of making dried sauce, spicy dried sauce, and spicy gluten. According to the 'Pingjiang County Chronicle', more than 300 years ago, Pingjiang dried sauce was listed as a palace tribute by the Qing Dynasty. Therefore, many Pingjiang people know how to make dried sauce, and Liu Weiping also learned the craft from his mother from a young age.
In 1998, Pingjiang County suffered from floods, and the raw material for dried sauce, soybeans, soared from over 0.7 yuan per jin to 1.5 yuan. To reduce costs, local dried sauce workshop masters used gluten to replace dried tofu, creating a small gluten snack with a similar taste to dried sauce but cheaper. This is the prototype of spicy strips in the memories of the post-80s and post-90s generations.
However, Pingjiang County is located in a mountainous area and does not produce much wheat, so Pingjiang people do not have a cost advantage in producing gluten. Therefore, a group of Pingjiang people began to leave Hunan, and Liu Weiping was one of them. At that time, Liu Weiping, who had just graduated from high school, was working in a factory in Guangdong. Seeing his fellow townsmen start businesses, he was eager to try.
In 1999, Liu Weiping chose Luohe, Henan, which is rich in wheat, as his development site, and led his younger brother Liu Fuping and fellow townspeople to start from a small workshop. Using gluten as raw material and combining the craft of dried sauce, they produced a product with 'slightly sweet, slightly spicy, refreshing, and long aftertaste'. At that time, their products received a good response in the market. In 2001, Liu Weiping found inspiration from traditional beef tendon noodles and developed China's first spicy strip—spicy silk.
At that time, there were many spicy strip manufacturers, mostly in the form of small workshops. For Liu Weiping, he was not satisfied with the output brought by small workshops. In 2002, after he advocated improving equipment, production increased sharply; in 2003, Liu Weiping registered the trademark 'Weilong', and 'Weilong Spicy Strips' was officially born. Since Liu Weiping registered the trademark, he began brand marketing work.
Distributing advertisements and writing soft articles, Liu Weiping initially tested the waters and expanded through ground promotion. Soon, Weilong opened up the Luohe market and began to expand to Zhengzhou, the entire Henan Province, and even the whole country. Since then, 'Weilong' has gradually become known to everyone. In 2004, Luohe Pingping Food Co., Ltd. was established, making Weilong the first spicy strip enterprise in the country to establish a company.
Weilong's rise owes much to marketing. In 2010, Weilong joined hands with celebrity Zhao Wei to launch the 'Weilong' classic series. In 2012, Yang Mi endorsed series such as 'Kiss and Burn' and 'Kiss Dried Tofu'; later, Weilong also imitated Apple and frequently appeared on Weibo hot searches.
Later, Weilong imitated Xiaomi with a slogan: Born for spicy snack enthusiasts. Online marketing and promotion not only earned Weilong attention but also brought real revenue. In 2019, Weilong's e-commerce channel revenue alone was 559 million yuan.
Today, Weilong has established its position as the industry leader in the entire spicy strip sector. At the 2020 partner conference, Weilong Chairman Liu Weiping revealed that Weilong's overall revenue in 2019 was 4.909 billion yuan, a year-on-year increase of over 40% from 3.5 billion yuan in 2018. Liu Weiping also stated that Weilong's revenue target for 2020 is 7.2 billion yuan, expected to grow nearly 47% from 2019.
From 1999 to 2020, Liu Weiping, with only a high school education, took more than 20 years to turn a 'five-cent snack' into a business with billions in revenue, also building a vast spicy strip empire.
**-02-** **The hidden concerns behind the internet-famous spicy strips: 'Junk food' label, do you eat it?**
In China's spicy strip industry, there has always been a distinction between the northern and southern schools—Pingjiang, Hunan, and Luohe, Henan, are two major spicy strip towns that go hand in hand.
But in the past 20 years, spicy strips have been known as 'junk food', and their food safety issues are still widely criticized. This is the most embarrassing thing that Weilong and others face.
Starting in 2005, CCTV successively exposed underground black workshops producing spicy strips. There were even rumors that the raw material for spicy strips was toilet paper and that they used gutter oil. Subsequently, a wave of rectification swept the country. For a time, spicy strips became the target of public criticism, and the industry entered a reshuffling period, with a large number of manufacturers closing. The spicy strip industry faced its darkest hour.
Before this, Liu Weiping had already realized the limitations of small workshops. So he invested the money he earned into renovating the production workshop: in 2004, he spent several million yuan to purchase a production line from Europe, changing the packaging machines from semi-automatic to fully automatic.
In 2007, the spicy strip industry faced another food safety crisis. The General Administration of Quality Supervision, Inspection and Quarantine listed Pingjiang as a national key county for food safety rectification, conducting a major overhaul of the spicy strip industry. Since then, relevant departments have gradually implemented stricter management systems for cooked food, requiring such enterprises to pass QS certification. Weilong's products met the standards and successfully passed the crisis, also earning the title of a famous trademark in Henan Province.
However, spicy strip foods are still frequent visitors to the blacklist of the Food and Drug Administration's random inspections. For most people, the impression that spicy strips are 'junk food' is deeply ingrained.
To break the public's inherent perception of spicy strips, Weilong invested a large amount of funds to establish food production bases and adopted fully automated sterile production workshops. In 2016, Weilong also invited Zhang Quandan, the then-popular 'Foxconn's first quality inspector', to broadcast live from the factory, showing the production process of Weilong spicy strips from a first-person perspective. After this marketing campaign, Weilong spicy strips successfully made their debut and successfully created a 'quality spicy strip' brand image.
Even so, food safety issues still surround Weilong. Weilong Food has been found by market supervision administrations and food and drug administrations in Zhejiang, Guiyang, Shanxi, Hubei and other provinces to have added sorbic acid and its potassium salt, and dehydroacetic acid and its sodium salt preservatives to its products.
In 2018, the Hubei Provincial Food and Drug Administration's announcement of food safety supervision and sampling inspection information pushed the spicy strip industry to the forefront. **According to the announcement by the Hubei Provincial Food and Drug Administration, among the 643 batches of 11 categories of food sampled, 622 batches of samples passed the inspection, and 21 batches failed.**
Among them were multiple 'spicy strip' products including Weilong Food (Pingping Food). Weilong Food responded that its products were produced according to the standards of Henan Province, where they are produced, and are completely qualified.
To solve the problem of inconsistent food safety standards across regions, in December 2019, the State Administration for Market Regulation issued an announcement on quality and safety supervision for seasoned flour products (including foods commonly known as 'spicy strips'), requiring local market supervision departments to manage 'spicy strip' foods uniformly according to the production license category of 'convenience foods (seasoned flour products)', and for the first time unified the classification and additive use standards for spicy strip foods.
At the same time, Weilong, which started with spicy strips, began to tear off the 'spicy strip' label and develop in a diversified and healthier direction. According to the official website, Weilong Food has now created dozens of products in four categories: flour products, soy products, konjac products, and vegetable products.
**-03-** **Snack companies flock to IPO. Chinese foodies support a trillion-yuan market.**
**In the golden decade of the explosion of China's snack market, a wave of snack companies joined the IPO tide.**
This is a huge market. According to a research report by Frost & Sullivan, **the retail sales of China's leisure food market grew from $89.9 billion in 2014 to $118.2 billion in 2018, and the market is further expanding, expected to grow to $171.7 billion by 2023, exceeding one trillion yuan.**
It can be said that Chinese foodies have sent snack companies to the IPO stage. In July this year, Ganyuan Food, which became popular with a single melon seed, landed on the Shenzhen Stock Exchange SME board and rang the bell for listing. On the first day of trading, the stock price hit the daily limit of 55 yuan, with a total market value exceeding 5 billion yuan. The founder Yan Binsheng, who started from scratch, has a personal fortune of over 3.8 billion yuan.
Also in February this year, Liangpin Shop successfully listed on the Shanghai Stock Exchange, becoming the first high-end snack stock. Starting in 2006, from a 30-square-meter store in Hubei to more than 2,300 stores nationwide, from initial losses to now selling 6 billion yuan a year, Liangpin Shop has carved out a place in China's snack market, with a total market value exceeding 20 billion yuan. Behind it, the institution—Capital Today's Xu Xin—earned more than 40 times on this investment.
Earlier, Liangpin Shop's rivals—Three Squirrels and Baicaowei—had already landed on the A-share market. Among them, Three Squirrels once again won the first place in the leisure food category across 9 channels including Tmall, JD.com, Vipshop, and Suning.com during this year's Double 11, becoming a national snack brand that has dominated the list for eight consecutive years.
On the other hand, Baicaowei took a different path and sold itself to PepsiCo for 5 billion yuan in June this year. This is Baicaowei's second 'sale', less than 4 years after it was acquired by snack company Haoxiangni for 960 million yuan. With this change of hands, Haoxiangni made a huge profit of 5 times.
**Although snack giants are flourishing and the entire leisure snack market still has huge incremental space, leisure snacks have low unit prices, wide audiences, and low barriers to entry. There are no fewer than 400 brands on Tmall alone. Consumer loyalty is hard to build, players are fiercely competing, and price wars are almost a daily occurrence.**
After years of melee, Three Squirrels, Baicaowei, and Liangpin Shop have gradually become the biggest players in China's leisure snack market, and after Liangpin Shop's successful IPO, China's snack 'three giants' have finally gathered on the A-share market, known as the BAT of the snack world.
**Consumption upgrading is sweeping forward, and a wave of new consumer brands is emerging continuously. At present, consumers' demand for main meals is shifting to snacks, gradually forming a trend of 'snackification of main meals'. Snacks are playing an increasingly important role, and health concepts such as low-fat and sugar-free are beginning to rise. A new battle has quietly begun.**
Source: Investment Circle (ID: pedaily2012), Authors: Zhang Jiwen, Zhou Jiali


---

## Copyright and AI use

This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL.

Contact: zhaobo258@gmail.com · +86 158 5481 7671