Source: FMCG Elite Club Editor: Fei Yu Zhang Honghui, general manager of Wahaha Beverage Company, retires, and Cai Lei, a second-generation manager, takes over. Recently, the senior management filing of Hangzhou Wahaha Beverage Co., Ltd. has changed: Zhang Honghui stepped down as general manager, and Huang Minzhen stepped down as director. In addition, Cai Lei joined the management team as manager, and Jiang Lijie became a director. Currently, the company's five key management members are Chairman Zong Qinghou, Directors Jiang Lijie and Wu Jianlin, Supervisor Guo Hong, and Manager Cai Lei. A Wahaha spokesperson told the media that both Zhang Honghui and Huang Minzhen have reached the statutory retirement age and are retiring normally. Cai Lei, who is about 40 years old, will succeed Zhang Honghui as general manager. Cai Lei previously served as the general manager of Wahaha's Xiasha base for several years. Old Guard Steps Down, New Management Takes Over Cai Lei's succession indicates that Wahaha's management is being updated to a younger generation. Hangzhou Wahaha Beverage Co., Ltd. was established in 1995 and currently has three major shareholders: Hangzhou Wahaha Hongzhen Investment Co., Ltd. (51%), Hangzhou Wahaha Group Co., Ltd. (39%), and Zhejiang Wahaha Industrial Co., Ltd. (10%). Zhang Honghui is a veteran of Wahaha. Thirty years ago, Zhang was an ordinary technician in the high-tech product group of Hu Qing Yu Tang. At age 30, he met Zong Qinghou by chance and was soon seconded to Hangzhou Nutrition Food Factory (the predecessor of Wahaha). "To be honest, Hu Qing Yu Tang was an old state-owned enterprise with good benefits. I was seconded to Hangzhou Nutrition Food Factory just to see my true level," Zhang once told the media. After eight months, Zhang's secondment ended, and he had to return to Hu Qing Yu Tang, which urged him repeatedly. At that time, Zong Qinghou made every effort to retain him, "like visiting the thatched cottage three times." Zong not only personally asked the district leaders to coordinate with Hu Qing Yu Tang but also gave Zhang the three-bedroom apartment that the Education Bureau had just allocated to him, while his own family continued to squeeze into a small room. In the end, Zhang stayed with Wahaha and worked there for over 20 years. Currently, Zhang Honghui still serves as a director of Hangzhou Wahaha Pharmaceutical and Health Products Co., Ltd. He also invested in Hong'an Yongsheng Investment Co., Ltd. with Wahaha director Wu Jianlin and Du Jianying, Party Secretary of Hangzhou Wahaha Group, holding a 10.9% stake. According to Qichacha, Cai Lei also serves as manager of Hangzhou Wahaha Baili Food Co., Ltd. and Hangzhou Wahaha Hongzhen Packaging Co., Ltd. The new general manager is Cai Lei, not Zong Fuli as many speculated. Wahaha Enters the Zong Fuli Era In fact, the outside world has always speculated that Zong Fuli would enter the core management and become general manager. As the second generation of the entrepreneur, Zong Fuli is called "Princess" within Wahaha. After finishing junior high school in 1996, she went to the United States to study. Four years later, she entered Pepperdine University in Los Angeles, majoring in international business. In 2004, Zong Fuli returned to China after graduation, and Zong Qinghou made her start as an assistant to a mid-level manager like other newcomers. Gradually, Zong Fuli entered Wahaha's businesses in milk powder, flavors, machinery, packaging, and import/export. By 2007, she left her father's protection and began to lead Hongsheng Beverage Group. After entering the Wahaha system, Zong Fuli's every move was closely watched by the market, and Wahaha's future fate was implicitly entrusted to this post-80s generation. After joining Wahaha, Zong Fuli performed impressively. Data shows that the Xiaoshan base under Zong Fuli's charge achieved operating revenue of 4.1 billion yuan in 2009, paying taxes of 414 million yuan, a 56% increase from 2006. Since 2010, Zong Fuli has served as president of Hongsheng Beverage Group Co., Ltd., which handles one-third of Wahaha's OEM production, mainly in food flavors, mechanical molds, printing and packaging, and beverage production. In 2016, Zong Fuli launched the customized fruit and vegetable juice brand KellyOne, starting to lay out online and high-end product areas. In 2018, after becoming the head of Wahaha's public relations department, Zong Fuli made significant innovations in brand marketing, making product positioning more youthful and packaging styles fresher. At the end of last year, Zong Qinghou stated that Wahaha would resume growth in 2018. At the same time, in 2019, Wahaha would launch more than ten new products, including milk, water, tea drinks, porridge, and jelly. Industry insiders say that Zong Fuli is trying to solve the problem of Wahaha's aging products, which is also the biggest problem Wahaha currently faces. The improvement in Wahaha's performance in 2018 also confirmed that Zong Fuli's changes have achieved certain results. At the same time, Zong Fuli's next task will be to lead Wahaha's breakthrough in the capital market. Zong Qinghou has repeatedly stated, "Wahaha is not short of money and will not go public," but last year he publicly said that Wahaha would consider going public. This change in thinking has also been speculated by the outside world as Zong Qinghou loosening his stance on the capital market. To accomplish this task, Zong Fuli is undoubtedly the best candidate. Why She Did Not Become General Manager In fact, this is a matter of two generations' thinking, and the two generations have different feelings for the enterprise. Therefore, on the issue of succession, the second-generation entrepreneurs' feelings are very subtle. From the beginning, Zong Qinghou had two models for choosing a successor: one is a management team succession, with Zong Fuli only appearing as a major shareholder and investor; the other is that Zong Fuli is both a representative of the major shareholder and the leader of the management team, making her the true "successor." Zong Qinghou has described the possibility of these two models on different occasions. For a long time, Zong Qinghou has been wavering between these two choices, unable to decide. Whether it is his daughter taking over or the management team taking over, Zong Qinghou feels it is acceptable. He just does his best to lay a more solid foundation for Wahaha. If Zong Fuli is chosen to take over, then her attitude is crucial. At the recording site of CCTV's "Gaopeng Manzuo," Liu Yonghao said to Liu Chang: "Whether you take over or do what you want to do, as long as you are happy." Zong Qinghou also said: "Whether she takes over depends on whether my daughter is happy." Undoubtedly, Zong Qinghou hopes that Zong Fuli will take over his position, inherit the "Zong" bloodline and genes of Wahaha, and continue the legal entity he created. And he has indeed been cultivating Zong Fuli as a successor. "Wahaha now produces about one-third of its output from the enterprises she manages," Zong Qinghou said. Zong Fuli has Zong Qinghou's blood in her veins, and her personality, even her gestures, have traces of her father. But she hopes to leave her own mark on the Wahaha family built by her father. "In the group company, decision-making power belongs only to my father, but in my own company, I feel I have 100% decision-making power." At present, Wahaha's decision-making power still rests with Chairman Zong Qinghou. The general manager is a role focused on execution. Taking over as general manager does not mean true succession. Cai Lei's appointment as general manager precisely indicates that the older generation of Wahaha people, represented by Zong Qinghou, is entering the exit phase, making final management arrangements for Zong Fuli to take over Wahaha. Zong Fuli's true succession will only be to the position of chairman, and only then will Wahaha truly enter the Zong Fuli era. This article references and excerpts:

  1. "Wahaha Beverage Company General Manager Zhang Honghui Retires, Second-Generation Manager Cai Lei Takes Over," by Yang Liyun, source: Jiemian;
  2. "Old Guard Retires, Successor Not Appearing, Wahaha Enters Zong Fuli Time," by Li Zhenxing, source: Beijing Business Today;
  3. "The Wahaha That Zong Qinghou Cannot Lose | The Choice of Two Generations," by Liu Dongqi, source: Family Business Magazine -END-