---
title: "Want Want's New Product Promotion Encounters Cold Shoulder: Supermarket Retail Discounts Up to 50%, Inventory Turnover Reaches 91 Days!"
description: "China Want Want, listed on the Hong Kong Stock Exchange main board in 2008, has faced a decline in performance despite a 26.1% revenue increase in its 15-month financial report ending March 2018, with operating profit down 7.4% and net profit down 6.6%. New product promotions have been weak, leading to heavy discounts and slow inventory turnover, while the company's traditional channels and brand image struggle to adapt to changing consumer preferences."
author: "张璐"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2018-06-25"
language: "en"
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original_source: "https://mp.weixin.qq.com/s/PDggiLWYojQ-Vp3JpVf8uQ"
translation: "https://xinjignxiao.com/zh/articles/%E6%97%BA%E6%97%BA%E6%96%B0%E5%93%81%E6%8E%A8%E5%B9%BF%E9%81%87%E5%86%B7-%E8%B6%85%E5%B8%82%E9%9B%B6%E5%94%AE%E4%BD%8E%E8%87%B35%E6%8A%98%E5%AD%98%E8%B4%A7%E5%91%A8%E8%BD%AC%E8%BE%BE91%E5%A4%A9-f87ff7c7.md"
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---

# Want Want's New Product Promotion Encounters Cold Shoulder: Supermarket Retail Discounts Up to 50%, Inventory Turnover Reaches 91 Days!

> China Want Want, listed on the Hong Kong Stock Exchange main board in 2008, has faced a decline in performance despite a 26.1% revenue increase in its 15-month financial report ending March 2018, with operating profit down 7.4% and net profit down 6.6%. New product promotions have been weak, leading to heavy discounts and slow inventory turnover, while the company's traditional channels and brand image struggle to adapt to changing consumer preferences.

Click 'Read Original' for details.
China Want Want, listed on the Hong Kong Stock Exchange main board in 2008, has climbed many mountains and fallen from grace over the past decade of operations.
Recently, China Want Want's financial report for the 15 months ending March this year showed group revenue of RMB 24.854 billion, a year-on-year increase of 26.1%; however, operating profit fell 7.4% to RMB 4.19 billion, net profit was RMB 3.1158 billion, down 6.6% year-on-year, and gross margin dropped 4.1 percentage points from 47.2% in the same period last year to 43.1%.
On June 20, a reporter from Changjiang Business Daily sent an interview request to China Want Want regarding its performance and called the Shanghai headquarters as listed on the official website. The response was that a real-name transfer and advance appointment were required, with no further comment. As of press time, no reply had been received.
Marketing expert Lu Shengzhen said, "Currently, Want Want's own small snack product matrix has reached a bottleneck, with limited development space and weak new product promotion. Additionally, distributors are gradually losing their original enthusiasm. Want Want, which entered the Chinese market in 1992, faces a severe situation."
**Revenue Declines Across All Three Segments**
On the evening of June 5, China Want Want released its annual report for the new fiscal year (April 1, 2017 – March 31, 2018) and its operating results for the 15 months ending March 31 this year. The announcement showed that for the 15 months ending March 31, total revenue was RMB 24.854 billion, a 26.1% increase from RMB 19.71 billion in the same period the previous year, but gross margin fell 4.4% year-on-year, and net profit attributable to equity holders fell 6.6% to RMB 3.1158 billion. In the 2017 fiscal year, gross margin fell 4.1 percentage points to 43.1%.
Additionally, by revenue composition, for the 12 months ending March 31, 2018, revenue from rice crackers, dairy products and beverages, and leisure foods was approximately RMB 5.654 billion, RMB 9.615 billion, and RMB 4.962 billion, respectively, up 7.1%, 8.4%, and 4% year-on-year, but gross margins all declined, down 5.2%, 2%, and 4% year-on-year.
However, a Changjiang Business Daily reporter found that in the first three quarters of 2017, China Want Want's revenue was RMB 13.585 billion, down 1.1% year-on-year; profit attributable to equity holders was RMB 2.02 billion, down 13.8% year-on-year; and gross margin was 44.1%, down 3.7 percentage points from the same period last year.
**Weak New Product Promotion and Low Recognition**
Since 2014, China Want Want has been mired in declining performance. The 2016 annual report showed revenue of RMB 19.71 billion, a 7.9% decrease year-on-year. This marked the third consecutive annual decline after 2014 and 2015. Since 2013, China Want Want's cumulative revenue has decreased by about 16.6%, and market value has shrunk by over HK$100 billion.
Facing declining revenue and shrinking market value, in 2015 China Want Want launched a multi-brand strategy to address customer personalization and youth preferences.
It introduced a series of new brands such as 'Heipi', 'Aiyo', 'Naduoli', and 'Laren', including new products like jelly, plum wine, and instant noodles. However, the launch of many new brands and products did not reverse the declining revenue trend.
On June 20, a Changjiang Business Daily reporter randomly visited several supermarkets in Wuchang District and found that only Walmart carried its newly launched dairy drinks. In community convenience stores and small to medium supermarkets, sales were still dominated by Want Want Milk and Want Want Small Steamed Buns, with new products rarely displayed on shelves. The reporter also found that almost all Want Want products were discounted, including rice crackers, crushed ice pops, and Want Want Milk, with discounts as deep as 50%.
**Inventory Turnover Days Reach 91, Far Exceeding Industry Average**
In terms of inventory, China Want Want's inventory in the first three quarters of 2017 was RMB 2.677 billion, up 9.13% year-on-year, with inventory turnover days at 91. In this regard, Zhu Danpeng, an analyst at China Food Industry, said that the average inventory turnover days for food industry companies is around 60 days, while China Want Want's reached 91 days, indicating slow product movement.
Xu Xiongjun, a well-known strategic positioning expert, believes that after years of rapid development, the main categories under China Want Want have reached market saturation, making it difficult to increase product volume. Moreover, as people increasingly value healthy living and food safety, Want Want's performance decline is inevitable.
Zhu Danpeng told Changjiang Business Daily that Want Want's main sales markets are in third- and fourth-tier cities, but young people in these areas go out to work, and the elderly find it hard to accept Want Want's new products, preferring familiar ones. Meanwhile, Want Want's products, prices, and brand are relatively low-end, and its expansion into first- and second-tier markets has been ineffective, despite heavy promotional spending. Therefore, China Want Want's new products have not helped revenue but have dragged down profits. Additionally, Want Want's channels are aging, and as younger consumers prefer e-commerce, its former strength in offline promotion has become a constraint on its development.
However, China Want Want has accumulated strong cash flow over the years, providing ample capital for trial and error. Recently, it has launched a series of quirky new products. In the future, it might accidentally turn Want Want toothpaste into a hit in the daily chemical sector, and a change of track is not impossible.
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Proposed Invited Companies
Conference Time
August 22-24, 2018
Conference Venue
Shanghai Baohua Marriott Hotel
Conference Content
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Registration Method
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-END-


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