Among Chinese people worldwide, many have never been to Guizhou, but few have never tasted Laoganma chili sauce, a specialty of Guizhou. Laoganma has countless pairings, from Laoganma dry-fried tiger prawns in upscale London restaurants to Laoganma fried rice in humble eateries. In front of Laoganma, ingredients and diners are equal—it's all about enhancing the rice.
▲ Laoganma Douchi Chicken at Peking University cafeteria. Source: @Peking University Weibo
Tao Huabi worked hard for half her life to put Laoganma on the throne of the chili sauce empire. But when the times abandon you, they don't even say goodbye. In 2021, when the list of Guizhou's top 100 private enterprises was released, Laoganma failed to make the top ten for the first time in five years. More chilling than the drop in ranking was a revenue decline of 1.2 billion yuan in one year. Laoganma's best-selling product, the 280g flavored Douchi sauce at 12 yuan per bottle, meant selling about 100 million fewer bottles last year. Previously, when buying chili sauce at the supermarket, whether to pick Laoganma was a yes/no question. Now, walking past the condiment aisle, faced with a dazzling array of rice sauces, seafood sauces, and meal sauces, choosing Laoganma has become a multiple-choice question. Is Laoganma getting old? Or has Laoganma changed?
The Leading Lady: Tao Huabi
To talk about Laoganma, one must inevitably mention its soul figure, Tao Huabi. As spicy as Laoganma's flavor is, Tao Huabi's early life was just as bitter. Aunt Tao was the eighth girl in her family, never attended school, and remains illiterate to this day. She married at 20, but her husband died of illness a few years later, leaving no money and two sons to raise. Tao Huabi recalled those days, saying, "If I weren't strong, I'd have no food to eat."
Children of the poor grow up early. Tao Huabi had no education, but her skills were not lacking. She picked up bricks at construction sites and set up a small shed by the roadside in Nanming District, Guiyang, selling a Guizhou snack called "rice tofu." To save money, she did everything herself, even stir-frying the chili sauce, a small condiment, personally. Tao Huabi called her stall "Shihui Restaurant" (Affordable Restaurant), and it lived up to its name, emphasizing affordability. Several schools were nearby, and any student who came to eat got generous portions. When poor students asked for credit, Tao Huabi waved it off. Students who came to eat gave this noodle-selling aunt a nickname: "Laoganma" (Godmother). Over time, even people in their 80s called Tao Huabi "Laoganma."
In 1994, when Guiyang built a ring road, a main road was constructed next to the "Shihui Restaurant." Many truck drivers passed by daily, stopping for a hot meal when hungry. Seeing how hard they worked without any side dish for their rice, Tao Huabi gave them some spicy Douchi to eat on the road. The truck drivers traveled all over, spreading the chili sauce nationwide. Through word of mouth, truck drivers across the country learned that a roadside stall in Guiyang made incredible chili sauce. Tao Huabi's small restaurant got nationwide advertising without spending a penny. Some out-of-town drivers even drove specifically to the Shihui Restaurant just to taste Tao Huabi's chili sauce.
As customers increased, giving away chili sauce became unsustainable for the small shop. Moreover, many regulars no longer wanted rice tofu but specifically asked for chili sauce. Tao Huabi simply closed the restaurant and renamed it "Tao's Flavored Food Store," selling only spicy Douchi. Business flourished, and even with three heads and six arms, Tao Huabi couldn't produce enough. In 1996, in two bungalows provided by Yunguan Village Committee, Tao Huabi and 40 workers celebrated the opening, and Tao's Food Store became Tao's Chili Sauce Processing Factory.
With a factory, the sauce needed a brand name. Tao Huabi naturally used her "jianghu nickname" and named it Laoganma Chili Sauce. Tao Huabi had little education and didn't understand many business rules, but she believed in the most basic principle of the common people: cash on delivery. Distributors had to pay in advance for goods and couldn't return them without reason. Of course, she wasn't hypocritical—her factory also paid in advance for chili peppers and glass bottles, never owing money. In four years, this "spicy" Guizhou woman turned a small workshop into a large factory with 1,200 workers, selling 300 million bottles of chili sauce a year.
Chili sauce isn't an industry with high technical barriers. Once Laoganma became popular, thousands of factories wanted to imitate it. Tao Huabi didn't understand product design or trademark law. To distinguish her sauce from others, she came up with the simplest idea—put her photo and name on the packaging. Tao Huabi went to a photo studio. When the photographer heard the photo would be on Laoganma for the whole country to see, he was so stressed that he took over 300 shots from various angles but wasn't satisfied. The hot-tempered Tao Huabi got angry: "I'm a boss, not a model. As long as the product sells, any photo will do." And so, this "apron ID photo" has been used to this day. Aunt Tao, wearing a white apron, looks at the camera with a stern expression, but her eyes seem to say everything. Later, it was jokingly called the "Mona Lisa" of condiments.
Having started from a stall, Tao Huabi valued taste and quality most. Laoganma chili sauce contains a small amount of peanuts. To ensure texture, Tao Huabi only used fresh peanuts from the current year, not even stale ones. Tao Huabi was once cheated by a glass bottle factory. In 2001, Laoganma purchased 256,000 substandard glass bottles. These bottles had poor sealing at the mouth, causing the chili sauce to leak oil during transport. Faced with so much sauce, factory staff suggested collecting it, repacking in new bottles, and selling it. Tao Huabi disagreed and insisted on destroying all of it, never letting defective products reach the market. After that, glass bottles became a line Laoganma stuck to. While others used plastic jars, Laoganma used glass for over a decade, all from one manufacturer. Many teachers and taxi drivers used Laoganma bottles as drinking cups.
In 2001, China joined the WTO. Tao Huabi didn't know what those three English letters meant, only that joining this "WTO" meant Laoganma could be sold abroad. Guizhou's commodity inspection and customs departments worked hard to help Laoganma handle export procedures. A little-known fact: most chili sauces on the market have a shelf life of 18-24 months, but Laoganma's is 14 months, with a few varieties up to 18 months. Recently, the internet has been abuzz with topics about "technology and ruthless tactics." Laoganma directly showed its ingredient list on Douyin, with no additives. This might be the secret to Laoganma's 0% defect rate and being the first food company in Guizhou to pass FDA certification. Thus, when the study abroad wave rose in 2006, the versatile Laoganma sauce became the best companion for students studying abroad. Tao Huabi became the "goddess" of Chinese students worldwide, and Laoganma was a staple in Chinese supermarkets in London, Tokyo, Melbourne, and San Francisco. During the 2012 Double 11 shopping festival, Laoganma was the most popular item at Singapore's Yue Hwa Chinese Products.
Mother Puts Son in Pocket, Son Kicks Mother into Ditch
Tao Huabi originally opened a snack stall to raise her two children as a single mother. Unexpectedly, she raised them so well that they became rich second-generation. After the company became successful, Tao Huabi divided the assets: her eldest son, Li Guishan, got 49% of Laoganma's shares and was responsible for market expansion, while her younger son, Li Miaoxing, got the remaining 51% and took charge of the company.
▲ Laoganma's shareholding structure is simple. Source: Tianyancha
On the 2022 Hurun Rich List, both of Tao Huabi's sons appeared. Li Miaoxing was worth 15.5 billion yuan, ranking 387th, and Li Guishan was worth 15 billion yuan, ranking 399th. While Laoganma's performance didn't grow, the brothers' wealth increased. Tao Huabi never attended school and didn't understand the intricacies of capital operations. She worried about being cheated and also feared cheating others, so she adhered to the "four no's" principle: no loans, no equity participation, no financing, and no listing. In 2018, the Shenzhen Stock Exchange, along with Guizhou Securities Regulatory Bureau and Guizhou Financial Office, visited Laoganma for research. It was ostensibly research, but actually they wanted to persuade Tao Huabi to list Laoganma. The Shenzhen Stock Exchange was sincere, offering support in IPO, corporate bonds, and asset-backed securities. Tao Huabi looked at her busy production line and orders flying in like snowflakes: "My company is doing so well, why would I need your help?" Tao Huabi was stubborn; anything related to listing was off the table. She always felt that listing was about deceiving people's money—taking money, circling it, and eventually crashing without accountability. Laoganma firmly refused to list or borrow money, doing only what its own funds allowed.
But her eldest son, Li Guishan, thought differently. Making chili sauce was hard work and slow money; investing in real estate was easier and more prestigious. Using the family's money, Li Guishan began buying stocks and land, with an investment map spanning from the southwest to the east, covering half of China, holding shares in multiple listed companies. But soon he stumbled: the Yuntian Yangyang project in Kunming was left unfinished, with over a dozen buildings cracked and leaking, posing serious safety hazards. The company was mired in debt and lawsuits, tarnishing the Laoganma brand. Tao Huabi was forced to clarify publicly that this was Li Guishan's personal investment and unrelated to Laoganma.
The elder brother lost face; the younger brother lost substance. After Li Miaoxing took control of Laoganma in 2014, to save costs, he changed the most important ingredient—the chili peppers. It's said that the secret to Laoganma's fresh aroma is Guizhou chili peppers with thick skin and fragrant flesh. Native Guizhou peppers become more fragrant when stir-fried, with good color and taste, but they are expensive. Li Miaoxing implemented a cost-reduction strategy, replacing the ingredients with cheaper peppers from other regions, changing Laoganma's flavor. After all, the brand was established; consumers would buy Laoganma on sight. As for the taste, well, aren't all chilies the same? It turned out that you should never treat consumers as fools. Although people didn't know what happened in the factory, after eating the same flavor for over a decade, they could tell if it changed. If the sauce doesn't taste good, it doesn't matter if the brand is Laoganma or even the ancestor of Laoganma.
Besides changing ingredients, Li Miaoxing also attempted a rather failed marketing stunt. In 2018, the "Laoganma hoodie" appeared at New York Fashion Week, with a huge logo printed on a red jacket and the words "National Goddess" on the sleeves. In 2019, Laoganma created a catchy but cringe-worthy music video "Twist Open Dried Mother," trying to appeal to young people on new media platforms. However, whether it was the hoodie or the video, the most common feedback was one word: "awkward." Laoganma's self-referential humor didn't win much influence; instead, it seemed like an elder using outdated slang in a family group chat.
The two sons' missteps led the company to three consecutive failures, with declining performance. In 2018, Laoganma's market share dropped from 20% to 11%, halved. Seeing her life's work being squandered, in 2019, Tao Huabi ended her retirement of playing mahjong and enjoying life, returning to take charge of Laoganma.
Laoganma Needs to Find Its Next Helmsman
After her return, Tao Huabi indeed proved that she was not too old to be effective. In 2016, a technician from Laoganma's quality department resigned and took the secret recipe with him, opening a factory outside and causing losses of over 10 million yuan to Laoganma. With the old recipe stolen, Tao Huabi took the opportunity to cater to younger tastes, using her exceptional palate to reformulate the recipe. The cheaper peppers didn't taste good, so Tao Huabi not only switched back to the original peppers but also expanded sourcing globally. When Laoganma's brand image faced a crisis, Tao Huabi, who rarely spoke to the media, stepped forward and candidly admitted her sons' past mistakes. That year, Laoganma turned the corner, and revenue exceeded 5 billion yuan for the first time. Some industry insiders said that Laoganma overcame this crisis thanks to Tao Huabi's personal charisma.
However, even the mightiest warrior will eventually grow old. Now, Tao Huabi is 75 years old, an old steed in the stable, but years of hard work have taken a toll on her health. She once said, "I'm very competitive; if I do something, I want to be number one." In Laoganma's early days, without money for automated equipment, the chili sauce was chopped by hand, knife by knife. Tao Huabi and the workers cried from the spiciness, but she joked to lighten the mood, pretending the chilies were apples so they wouldn't be spicy. In her youth, she didn't spare herself, chopping chilies relentlessly until her hands cramped. She described her hands as "having chicken claw convulsions." Now, in her old age, Tao Huabi suffers from various ailments, with shoulder periarthritis and cervical spondylosis causing sleepless nights. Not just her shoulders—her ten fingernails have calcified from years of making rice tofu, and her hands peel every spring.
The queen is old, but the empire still depends on her, especially with strong enemies surrounding the borders. The chili sauce track is now tense, with new players all targeting Laoganma as their goal to surpass, aiming to break into this chili sauce empire.
▲ A Xiaohongshu blogger's chili sauce recommendation. Source: Jianjian Laboratory
There's Hubang, targeting the one-person meal delivery market; there's Lin Yilun's Fanye Chili Sauce with celebrity aura; and there's the big IP Li Ziqi. Old players are also quietly making moves: Zhongjing Mushroom Sauce went public, and Jixiangju keeps iterating flavors. Tao Huabi can save Laoganma for a time, but not forever. The 1.2 billion yuan decline in 2021 is written in black and white. In March 2022, Laoganma issued a price increase notice: 6%-10%, with each case (24 bottles) rising by about 14-18 yuan. Consumers immediately started discussing: Is this sauce, which we've eaten for over a decade, still worth buying?
In the chili sauce kingdom, Tao Huabi is a warm-hearted godmother; in the business world, she seems more like an innocent girl. Some have commented that Laoganma is completely a family workshop, lacking the sophistication of internet giants or the elegance of financial elites. It's just filling bottles on the production line, practicing for decades to achieve a spoonful of accuracy—just skill from repetition, one spoonful exactly filling a bottle. Sincerity is always the ultimate killer move. Tao Huabi, who never studied business management or got an MBA, doesn't understand OKR or performance reviews. She only thinks about taking care of everyone, ensuring they eat and stay warm. So she built a canteen and dormitories at the company, providing food and lodging. In the past, when she was healthier, she'd cook noodles for employees' birthdays. When employees got married, she'd rush to be the witness. No one called her "President Tao"; they all called her "Laoganma," which is very human.
Over the years, we've seen too many stories of capital operations, IPO bell-ringing, and overnight riches, watching them rise and then collapse. Looking back at Tao Huabi's story of chopping chilies by hand, it's hard not to be moved by her spirit of hard work and wealth creation. Tao Huabi may not have high academic qualifications, but she has high vision. She holds "be a good person, do good business" as her life principle. I believe that even without Laoganma, Tao Huabi could have created "Xiaoganma," "Laoqinma," or "Laoganniang."
But without Tao Huabi, can Laoganma resist the temptation of capital in the future? Will it be tempted to secretly switch to cheaper peppers? These precedents are still fresh.
The billion-yuan chili sauce giant is struggling to find its next helmsman.
*Cover image source: Internet
References: [Guizhou News Broadcast] Tao Huabi: The "National Godmother" Created by the Times [Guizhou News Broadcast] Discovering Guizhou Manufacturing Around You: So This Is "Laoganma" CCTV "Labor Builds the Chinese Dream" Labor Creates Wealth He Shouwu. Acting According to One's Own Knowledge—A Record of Tao Huabi, Founder of Laoganma Flavored Food Co., Ltd. [J]. Business Culture, 2021(14):9-10+8. Xinhua News Agency Quick Look "Exclusive Interview with Tao Huabi: Exploring the 'National Goddess' Laoganma"