Ham sausages wait for aesthetic fatigue to resolve

In 2014, the 30th anniversary of the establishment of Shuanghui. This year, Shuanghui acquired the Smithfield assets listed in Hong Kong. Shuanghui ranked first in the world in meat, fresh produce and pig breeding.

Also in this year, the share price of Shuanghui Development (000895.SZ) hit a new low in recent years, and the listing of related company Wanzhou International (00288.HK) was also a twist.

There was a lot of talk about Shuanghui's voice. Among them were rumors that Bandung was in poor health. Soon the Shuanghui rudder was frequently seen in public and rumors were not broken.

In the acquisition of Smithfield, some media questioned that the acquisition would bring huge debt pressure to Shuanghui. After Wanzhou International went public, it repaid part of its debt with the funds raised. The ravages of the animal epidemic in the United States, pig prices have soared, so that Smithfield earn pigs were filled with pride, this "timely rain" so that Shuanghui deal with greater debt. The most important thing is that it is really not a big problem that financial institutions such as Shuanghui United Banking Co., Ltd. and other financial institutions can use the funds to repay their debts.

Insufficient innovation is where Shuanghui is concerned. At the end of last year, a number of executives including Bandung increased their holdings of Shuanghui to develop stocks and cheered investors. Investor confidence is not enough. One of my author's friends said that the future development strategy announced by Shuanghui is not considered to be related to new ideas.

The aesthetic fatigue of investors

In the development plans for the next 10 years released last year, ham is still one of the focuses of Shuanghui's business. Some key old products, such as spicy and crispy sausages, mouth-fried spicy kings, and Q-children, will improve quality and upgrade tastes. At the beginning of this year, Shuanghui introduced many new products to the market, including "Never Taste Flowers", "Never Taste the Pear", "Never Try Any Apricot", "Sweet Up", and "Hawaiian" from the United States. "The Virginia flavor" sausage, "cheese fish sausage." These new products are all ham sausages and are all high-temperature meat products.

Shuanghui has been doing ham for decades, and it is a bit of an aesthetic fatigued investor who wants to see a fresher, more exciting development strategy. High-temperature meat products in the Chinese market, especially in the first-tier cities, have seen signs of peaking, long shelf life, and a long list of ham sausages with food additives on the list of ingredients.

Shuanghui is not just "eating old books." Shuanghui is developing prefabricated semi-finished products such as Hong Kong-style pork roast, secret stewed pork, and stewed braised pork ribs. The prefabricated products will be the three main series of new business plans for the new kitchen table of Shuanghui Future Kitchen with Chinese dishes and shabu-shabu series. I hope to enter the restaurant. Chains, hotels, group meals, canteens and other B2B fields. The sales target of high-temperature meat products is mass consumers and belongs to the B2C category.

The 2014 Fuk Hei incident caused heavy losses to McDonald's and KFC, and also gave Chinese local restaurant chain companies a lesson. An insider said that rice, noodles, and oil products, and many Chinese restaurants Chain companies began to consider purchasing products from well-known companies to minimize food safety risks. As an important raw material for Chinese food, Shuanghui can become a “central kitchen” for Chinese restaurant chain companies. It is not impossible to create a Shuanghui.

The more channels, the better?

Last year, Shuanghui announced ambitious plans for channel expansion. The encounter of a Shuanghui franchise owner provided a new perspective for observing the prospects of the project.

The boss opened a butcher shop in Henan Province. The local acceptance of cold pork is not high. They are used to killing fresh meat. The owner complains that the market cannot be opened. Shuanghui has not given any support for marketing. It is on its own.

Shuanghui currently has tens of thousands of such fresh food franchises in the country. According to the plan, Shuanghui plans to increase more than 10,000 outlets each year in the next five years, and by the end of 2020, a total of more than 100,000 sales networks will be formed. This is a greater challenge for Shuanghui sales channel support and service capabilities.

If there is a huge dealer team, if it is neglected to manage, even if Shuanghui insists on head detection in the slaughtering process, food safety accidents may still occur at the sales stage.

Shuanghui's counterpart Yurun once had a large number of M&A slaughter companies in the country, and its slaughter capacity was the national leader. However, the qualifications of some of the acquired companies were uneven, and the bitter fruit of the large-scale leap forward was not yet fully digested by Yurun.

Compared with Yurun, the operating rate of the Shuanghui plant is much better. The layout of sales channels is one of profitable when you open one, which may be faster than demand and may be a great achievement for great companies.