Zong Qing after the retail: not too long to consider whether to do electricity business

Zhu Zhen, the FT's Chinese-language network reporter, said in an interview that "many electrical business enterprises are contacting us, hoping to help us to do the electric business network." I am also considering cooperation. ”

The following is the original text:

In an ordinary office building not far from the Victoria train station in London, a black-clothed pope sat in a corner of the not-so-spacious conference room, surrounded by a group of British local brand retailers. At the moment, about Eva Mall promotion will just end, the 67-Year-old China's richest man expression calm, patiently and brand representatives to negotiate one by one, not now tired look.

Recently on the network is hot to discuss a news about him: This February, Zong refused the Queen of England's dinner, the reason is too much for a meal. This past weekend, the chairman of China's largest beverage group came to London. I asked him to verify the Queen's dinner, he looked a little helpless: "A 12-hour plane to eat dinner, boring." It was just the Spring festival, and my staff wanted to have a holiday ... "to ask for the purpose of this trip, he answered the simple sentence:" This time to engage in business, do some practical work. ”

Zong has a very tight schedule and has gone to France, Spain and Italy before coming to Britain, where he is the last leg of a European tour, with the main aim of reaching out to British retailers to promote Wahaha, a European brand boutique that soon opened in China. After listening to the people close to Zong said that he will still be "super busy", in order to meet all China's investment promotion conference, Zong declined the June G8 Group A theme summit invitation.

Once again, Zong extended an olive branch to an international brand, tempting imagination. Seven years ago, it was this stubborn Chinese entrepreneur, and the French Danone launched a China reform and opening up 30 years of the most influential international business.

In April this year, at a Chinese property forum, Zong briefed the public on Wahaha's foray into commercial real estate by a deputy, announcing that Wahaha's business would involve large-scale retail chain operations, including supermarkets, department stores, factory stores and polemic. And one shot is big: plans to build 100 large business complex across China in 3-5 years.

The Chinese drink tycoon's intentions are clear. The fierce competition between rivals over the past few years, and the squeeze on profits from traditional retailing, are constantly threatening the main business of Wahaha. This reflects the overall decline in China's beverage industry, as well as the 2012 Wahaha Group's revenue has been negative. It also seems to have strengthened Zong Qing's determination to enter the downstream market, in order to open up the industrial chain, but also to find new growth points.

But Zong did not consider his drink kingdom a crisis. "At present, the profit of the beverage industry is relatively good." It's just that we want other industries to be able to bring around. "Ask him how much energy is allocated to his work now," Mr Zong replied, "The drink, the other colleagues will do it, and I may have to devote a little more effort to new things, because it is not clear enough."

In the eyes of analysts, the foray into retailing is undoubtedly a heavy bet left by Zong. On the one hand, China's commercial real estate bubble is becoming more and more serious, at this time the risk should not be small boo. On the other hand, in the investment links, Zong also bypassed the traditional middleman distribution channels, the choice of direct face to foreign brands, the plan to attract a group of China has no agency history of the two or three-line European brands into their own retail system. Doubts inevitably follow: are international retailers really willing to co-operate? Does the domestic consumer buy the account of the foreign brands introduced by Zong Qing? ... All sorts of things.

In the past, when addressing the issue of corporate diversification, Zong has referred to the example of a unified Taiwan company. Look at the unified history, the 80 's, the production of food and beverage as the main business of the reunification began to try to transition to the retail industry, and in Taiwan, the wide range of ultra, but with the ensuing 6 years of sustained losses.

After I asked Mr Zong, was there enough psychological anticipation for the loss? Zong's attitude is more optimistic: "I don't think we will have to go through such a long loss." The beginning may have the intersection fee, but will not be too big difficult problem, should say Owa Mall now the progress is relatively fast, the business reason is interlinked, we in the domestic prestige is good, does the matter more conveniently. ”

But the reality is not so easy. Last November in order to meet the Wahaha 25 anniversary celebration in Hangzhou, the first baby European mall, is now encountering the scarcity of customers, the problem of poor investment.

It should be said that after the current relative advantage of Zong Qing is sufficient capital, Zong said: "The shopping malls are rented, the next will be built on their own, this cost may be relatively large." But now our group two provinces (Zhejiang and Hunan) dealers have signed, if the mall needs, each province dealers will pay investment, and the bank also give us a lot of credit, so money is not a problem. ”

In front of the table, there is a list of delegates to the presentation, printed with a long series of names from the British clothing, food and nutrition brands, including Marks & Spencer, Vivienne Westwood such as well-known brands. The names of several of the world's largest department stores were also listed in a schedule for the London visit.

Random to the scene of several retailers representative asked about the impression of Zong and Eva Mall, the answer is: The Chinese richest man is very nice, business thinking agile, no shelves. But asked if he was willing to co-operate with him, he found that the majority of the watchers, more replies or "to wait and see." ”

Market and cost are one of the most concerned issues for these overseas brands. A director of the British nutrition brand Calculated: "Our future plans to open 300 stores in China, Mr. Zong's Eva Mall plan is five years to open 100 stores, this scale is equivalent to the domestic Wanda and the New World." If the brand strategy matches, we will naturally hitch a ride. In addition, China's current market rents are too high, even higher than in the United Kingdom. If Mr Zong's future cost of land is lower, then the rent concession will be more attractive to us. ”

But the director immediately changed: "We have not seen the field, this is a two-way choice, which can do business, we go." The Times demand more intense competition, if Shoppingmall qualification is general, we will not go. After all, we are also a century brand, can not hit the brand. ”

It is clear that, in addition to its abundant financial resources, Zong needs to show more to his overseas partners.

But Zong did not seem to worry about no one to join, he told reporters that the year plan to introduce 100 brands into the Eva Mall, this is a hard target. "This time I went to Spain and the trade Minister of Spain was helping me with my business," he said. Because he believes in our credibility and ability in China. ”

In the aftermath of Zong's view, the logic of making this deal with foreign businessmen is "we give markets, they produce products." I can sell his products to China and they will be very happy. ”

"The situation now is that neither side can trust each other. These foreign brands have the need to develop the Chinese market, but the store volume is too small, foreign manufacturers are not willing to produce, the brand does not dare to pay the deposit first. "But this is the advantage after Zong," Now I help them to engage in investment, we are still relatively influential in the country, the credibility is relatively good, accept his deposit, he will be more assured. When the order is summed up, I will give orders to foreign manufacturers, and then to the brand to open a letter of credit. Open the letter of credit, they will be more down-to-earth, so that the issue of accounting also resolved. ”

I asked Zong after the Owa mall's consumer positioning is what? Zong Qing replied: High-grade + mid-range, but to young fashion mid-range brand.

The 67-Year-old Zong has formed a set of views on the fashion industry, which seems to have come from his own experience in the European market: "The French and Italian big-name young people are pressed, the style is easy to move, are a group of old designers to decide." And the two or three line brand changes will soon, relatively free, the price is relatively cheap. In contrast, the two years of British brand innovation is good. ”

How to ensure that these brands can be recognized by domestic consumers? Zong's strategy is: "Two or three line brand quality is good, affordable, suitable for China's young fashion consumers, too expensive luxury they can not afford." My market positioning is mainly young people, preferably the Chinese are more familiar with the brand 60%, and then drive a group of unfamiliar brands. Put the two together. ”

Coincidentally, on the same day, the headquarters also in Hangzhou Alibaba Group is holding its 10 anniversary celebration of Taobao. In Hangzhou Huanglong Sports Center of the Limelight, the group Chairman Ma Yun in the manner of singing and dancing loudly announced "retirement." Echoing this, is the electricity business upsurge is strong impact on the traditional Chinese retail market.

Nowadays, Mr Zong and Mr Ma, the old two-generation entrepreneur, are speaking in a different way about the new and old Chinese retailing industry. Ma Yun from the electronic commerce "scenery retire" in contrast, Zong Qing after the pro-Pro traditional retail figure seems a little lonely, for a long time, he as a representative of traditional Chinese industry has been insisting on the electric business and retirement said no.

But it is not hard to find that the views of Zong on some things are also undergoing subtle changes. Will there be a place for electricity in the future retail landscape of Wahaha? After this Zong's attitude obviously also is not monolithic: "A lot of electric business enterprise in contact with us, hope to help us to do electric business network." I am also considering cooperation. ”

At the same time, however, there are still some principles that cannot be modified in the minds of the richest man in China. When I asked Zong Qing, this time into unfamiliar areas, and foreign brands to cooperate, the past strong leadership style will continue, will worry about conflict? What is the impact of past experiences?

Today, more than three years after the end of the Dawa debate, the issue remains a bit sensitive. Zong Qing's expression is also serious up, he stressed: "My management style is always strong and open-minded, business pay attention to equality and mutual benefit, speak good faith, talk about the win." ”

As for their own strong style will not change, Zong said: "We are engaged in democratic centralism, the seminar is relatively free, but once the decision is decided, it is necessary to implement, otherwise speaking does not count, enterprises how to do?" ”