In fact, this is the third consecutive year of Zhouheiduck net profit decline. For Zhouheiduck, absolute flavor and other marinade brand, in the snacks, tea and drinks and other industries rise and rapid development of the ceiling of the marinade industry is gradually visible, leaving the marinade of this traditional industry is less and less space for development, looking for new growth points need a new story, is the above these companies are facing a serious test.
Revenue and net profit double-dip
The decline in performance of Zhouheiduck, in the first half of last year has been revealed. 2020 the first half of Zhouheiduck operating income of about 903 million yuan, a year-on-year decline of 44.43%; net profit loss of about 0.42 billion yuan, year-on-year from profit to loss, a decline of 118.83%. This is also the first time that Zhouheiduck's performance after the listing loss.
The loss was mainly attributed to a sharp drop in store traffic and a decline in sales as a result of the New Crown epidemic that swept through China. Zhouheiduck said, "The Group suspended production activities in central China to comply with the guidelines and requirements of the relevant epidemic prevention and control work, and about 1,000 stores nationwide*** were temporarily closed.
In fact, putting aside the impact of the epidemic factor, the beginning of 2018, Zhouheiduck's performance has shown decadence. 2017-2019, Zhouheiduck realized operating income of 3.249 billion yuan, 3.212 billion yuan, and 3.186 billion yuan, and net profit of 762 million yuan, 540 million yuan and 407 million yuan.
In 2018-2019, Zhouheiduck's revenue decreased by 1.15% and 0.79% year-on-year; net profit decreased by 29.09% and 24.56% year-on-year.
However, Zhouheiduck's sales gross margin has been at a high level in recent years.Wind shows that Zhouheiduck's sales gross margin was 60.93%, 57.53%, and 56.54% in 2017-2019, respectively. The gross profit margin of sales of Huangshanghuang and Jieyi Foods, on the other hand, fluctuated in the range of 33%-38%.
It is understood that this is mainly due to the difference in the sales model between companies. Zhouheiduck to direct management, Jiewei food to franchise-based, HuangShangHuang franchise and direct management model both.
As of 2019, Jelly opened 10,954 stores in the country **** (excluding Hong Kong, Macao and Taiwan), and in recent years has maintained a high rate of expansion; Huang Huang has 3,600 stores; while the number of Zhouheiduck stores is only 1,301, and only 13 new stores in 2019.
After stagnant growth, Zhou Heiduck chose to expand its stores to increase revenue. in November 2019, Zhou Heiduck officially opened the development of the franchise model, upgrading the business model to "direct operation + franchise".
However, according to industry analysts, this model can alleviate capital pressure to a certain extent and accelerate the speed of expansion. But it will also make the problem of production capacity with the expansion of the number of stores, and more prominent.
Selling expenses remain high
Franchise model for the number of stores to increase the effect of immediate, however, the franchise model due to the limited management standards, product quality of good and bad, there are often food safety issues, online complaint platforms are not a lack of Zhouheiduck product deterioration of complaints.
In addition to the expansion of stores, Zhou Heiduck has also been trying to expand online e-commerce business, stationed in supermarkets and convenience stores and new retail scenarios, to further strengthen the expansion of new markets and penetration of mature markets. In April last year, Zhou Heiduck founder and chairman Zhou Fuyu appeared in Weiya live, personally down with goods.
As early as May 2017, Zhou Hei duck announced a high-profile entry into the crawfish market, the launch of a sub-brand "poly a shrimp", only four months after the listing, the product was discontinued. In order to enhance competitiveness, Zhouheiduck, Jiewei and Huang Shanghuang companies have also tried to launch other categories, including mushrooms, squid, lotus root slices and so on.
In order to mitigate the impact of the outbreak, Zhou Heiduck, which mainly operates a "direct" model, has not only opened up franchises, but has also further sunk its channels by setting up stores in Shanghai's Family Mart and Beijing's 7-Eleven convenience stores. However, from the results of the past two years can be seen, these measures did not significantly improve performance,
At the same time, Zhouheiduck's cost of goods sold has been in the industry at a high level. According to Wind, in the first half of 2020, Zhouheiduck, Huangshanghuang and Jiewei Foods' selling costs were about 462 million yuan, 177 million yuan and 235 million yuan respectively. Zhouheiduck's selling expenses in 2017-2019 are about 948 million yuan, 1.082 billion yuan and 1.133 billion yuan, respectively.
In the 2019 annual report, Zhouheiduck had mentioned that "the increase in selling expenses was mainly due to the increase in store rentals related to the expansion of the Group's store network, salary and benefits for sales staff, and transportation expenses incurred due to geographical expansion".
As for the reasons for the successive declines in performance, Zhou Heiduck said it was mainly related to the intensification of competition in the market, the decrease in revenue from self-operated stores and the decrease in revenue from distributors. In addition, it is also facing pressure from the gradual disappearance of the e-commerce dividend and the diversion of consumers by emerging food products.
In contrast, Zhou Heiduck's main rivals, Jelly and Huang Huang, performed slightly better than Zhou Heiduck, and Huang Huang even realized double growth in profit under the impact of the epidemic.
Jiewei Foods' revenue in the first half of 2020 was about 2.413 billion yuan, down 3.08 percent year-on-year, with net profit of about 274 million yuan, down 30.78 percent year-on-year, while Huang Huang's revenue was about 1.365 billion yuan, up 16.77 percent year-on-year, with net profit of about 158 million yuan, up 12.25 percent year-on-year.
Industry analysts believe that for companies, too much selling expenses will erode performance. Casual marinated products toward branding, branded products accounted for an increasing proportion.
With the strengthening of consumer brand awareness and the intensification of market competition, most of the industry and enterprises have entered the micro-profit era. Marinated food industry categories are beginning to age, the ceiling appeared. Future growth lies in four aspects: quality, brand, service system, and customer stickiness.