“After working overtime late at night, I am used to eating a self-heating hot pot or cooking a pack of snail noodles to satisfy my hunger.” Ms. Meng from the Beipiao family told the reporter of “China Business Daily”. It is convenient, delicious and inexpensive because she likes convenience. reason for eating.
At the same time, the reporter found that the convenience and fast food track has attracted capital attention. Recently, the bagged fast food brand “cooking bag” and the convenient fast food brand “Bagou” have successively completed new rounds of financing. According to incomplete statistics from the reporter, since last year, the total financing of the convenience and fast food track has exceeded 1 billion yuan.
Many interviewees believe that the rapid development of convenience and fast food has something to do with the stay-at-home economy, the lazy economy, and technological upgrading. Sub-development has become inevitable.
China’s food industry analyst Zhu Danpeng believes that the convenience and fast food market still has a lot of room for development in the future. He further stated, “As the demographic dividend of the new generation continues to superimpose, convenience food will have a period of rapid growth for 5 to 6 years.”
Hot Track
“In the past, instant noodles and instant noodles came to mind when mentioning convenience and fast food. Later, when snail noodles became popular all over the Internet, they were often purchased. It may be due to frequent searches. The e-commerce platform recommended more instant food products according to personal preferences. I just realized that there are so many new brands and a wide range of categories,” Ms. Meng told reporters.
As Ms. Meng said, in recent years, the field of convenience and fast food has continued to expand, and more and more players are participating. According to the data of Tianyancha, there are more than 100,000 enterprises operating in “convenience food”. In addition, from the perspective of consumption, the sales growth rate of convenience and fast food is also relatively obvious. According to statistics from Xingtu, during the “6.18” promotion that just came to an end, the sales of convenience and fast food online increased by 27.5% year-on-year.
The rapid development of convenience and fast food is driven by various factors. Xu Xiongjun, the founder of Jiude Positioning Consulting Company, believes that “under the influence of dividends such as the stay-at-home economy, the lazy economy and the single economy, the convenience and fast food has risen rapidly in recent years. At the same time, the company itself continues to introduce convenient and cost-effective products, which makes the convenience and fast food industry show a blowout trend.”
Liu Xingjian, founding partner of Daily Capital, attributed the industry’s prosperity to changes in demand and supply. He said, “Consumption habits have been changing in recent years. Diversified consumer demand has prompted the emergence of more new products. In addition, it is also related to industrial development and technological upgrading.”
Behind the growing consumer demand, the convenience and fast food track has grown into a 100-billion-level track. The “2021 Convenience and Fast Food Industry Insight Report” released by CBNData pointed out that the domestic market is expected to exceed 250 billion yuan.
In this context, in the past two years, there have been continuous news of financing on the convenient fast food track. For example, Bagou recently completed the Pre-A round of financing of tens of millions of yuan, and Cooking Bags also completed the Pre-A round of financing of nearly 10 million yuan. In addition, Akuan Foods is seeking to go public after completing multiple rounds of financing. It has completed 5 rounds of financing in three years since HiPot, including Hillhouse Capital and other well-known investment institutions.
Liu Xingjian pointed out that “new and cutting-edge brands that have obtained financing have certain advantages in terms of supply chain, technology, and insight into users. For example, integrating the source supply chain, optimizing the cost line, and improving consumers’ eating experience through technological breakthroughs, etc., it is also necessary to understand user needs. The underlying logic of the product is constantly optimizing products for the purpose of convenience, deliciousness, and cost-effectiveness, and these products naturally perform well in terms of dynamic sales and repurchase rates.”
Gaming Market Segments
The reporter searched various e-commerce platforms and found that there are currently a wide variety of convenient and fast food products, including self-heating hot pot, pasta, instant porridge, skewers, pizza, etc., and the categories are showing a trend of diversification and segmentation. In addition, product flavors are also further subdivided, such as Liuzhou snail noodles, Guilin rice noodles, Nanchang mixed noodles, and Changsha lard mixed noodles launched by the company around local characteristics.
In addition, the industry has also expanded and subdivided the consumption scenarios of convenient and fast food, which currently include consumption scenarios such as one-person food, family food, new night snack economy, outdoor scenes, and dormitory sharing. Scenes.
In this regard, Liu Xingjian said that when the industry develops to a certain stage, it is an inevitable law to change from extensive development to refined operation. Emerging brands need to seek differentiation paths from subdivided fields.
“The current subdivision and iteration of the industry is the result of the upgrading of the consumer side forcing the innovation and upgrading of the industrial side. In the future, the subdivision track of the entire Chinese convenience food will enter an all-round and multi-dimensional competition situation, and product strength will become the key factor for enterprises to build their own industry. The key to the barrier.” Zhu Danpeng said.
Professor Sun Baoguo, an academician of the Chinese Academy of Engineering, once pointed out that the main direction of the future development of convenience food and even Chinese food is four words, namely “flavor and health”. The development of the food industry should be flavor and health-oriented.
In fact, the healthyization of convenient and fast food is one of the directions of industrial upgrading and transformation in recent years, and many companies are transitioning to healthy food through technological iteration. Take the category of instant noodles as an example. The health of this type of enterprise is mainly reflected in reducing oil and increasing nutrition. According to the official introduction of Jinmailang, it meets the needs of consumers for “reducing oil, salt and sugar” through 0-frying cooking technology and FD freeze-drying technology. In addition to instant noodles, many new products and brands focusing on health have emerged in the convenience and fast food market, such as the instant old hen soup focusing on nutrition, the low-fat konjac cold noodle, seaweed noodles, etc.; cutting-edge brands focusing on health and low calories such as Super Zero, Orange Run, etc.
Innovative products mean an increase in costs. The person in charge of a food processing factory in Henan told reporters, “In order to develop new healthy products, our factory has built an internal laboratory for self-developed products and finished product testing, etc., but this also makes The cost has increased.” Cai Hongliang, the founder and chairman of the Zihai pot brand, once told the media, “The use of freeze-drying technology has increased the related costs by four times.” Liu Xingjian pointed out, “In an era of relying on a big hit to win the world In the past, enterprises need to continuously iterate product lines, reduce costs, and meet consumer demand, which also tests the supply chain capabilities of enterprises.”
It is worth noting that many companies have begun to improve their supply chains. According to public information, Akuan Foods has five production bases and provides OEM services for many well-known brands. Zihi Pot has invested in more than a dozen upstream factories, aiming to deeply participate in the upstream of dishes and other ingredients and control the cost performance.
Fang Ajian, founder and CEO of Bagou, said that although the trend of catering standardization has driven the optimization of the convenience and fast food supply chain, for some products, the fast food supply system does not have a ready-made solution in terms of taste restoration; in addition, upstream factories exist The long-term path dependence problem and the lack of motivation to iterate the production process mean that the supply chain upgrade must be completed by the demand side. He said, “Bagou currently controls the core production links and reduces production costs through cost traceability and in-depth supply chain transformation. Through one year’s efforts, the total contracting cost of the entire series of products has been reduced by 45%.”
The competition between old and new brands is accelerating
The reporter noticed that the current players in the convenience and fast food market are mainly divided into emerging brands such as Lamenshuo, Kongke, and Bagou, and traditional brands such as Master Kong and Uni-President. Different companies have different development priorities. At present, the industry has entered the development stage of healthy competition between new and old brands. Traditional brands keep up with the trend by launching new products, while new brands work hard on innovative categories and content marketing to take a differentiated route.
Zhu Danpeng believes that traditional manufacturers already have brand effect, scale effect, and mature production lines, etc., and it is not difficult to innovate, upgrade, and iterate. For new brands, it is still necessary to pursue a complete supply chain, quality stability, scene innovation, Service system upgrades, customer stickiness enhancement, etc.
Judging from the actions of traditional enterprises, enterprises such as Master Kong and Uni-President are marching towards the high end. At the beginning of this year, Jinmailang launched a high-end brand Ramen Fan; previously, Master Kong launched high-end brands such as “Suda Noodle House”; Uni-President launched a series of high-end brands such as “Man-Han Dinner” and “Kaixiaozao”, and opened a separate Official flagship store.
From the perspective of new brand strategies, Akuan Foods and Kongke are taking a differentiated route. For example, Akuan Foods has seized the regional characteristics and launched nearly 100 items such as Sichuan Noodles Series and Chongqing Small Noodles Series; Kongke and Ramen Said to enter a relatively blue ocean market segment, the former focuses on pasta, and the latter focuses on Japanese ramen. In terms of channels, some new brands have embarked on the road of online and offline integration. According to the prospectus of Akuan Foods, from 2019 to 2021, its online channel sales revenue will be 308 million yuan, 661 million yuan and 743 million yuan respectively, increasing year by year; the number of offline dealers is increasing, respectively 677, 810, 906 homes. In addition, according to Fang Ajian, Bagou’s online and offline sales ratio is 3:7, and it will continue to use offline channels as its main sales position in the future.
“Nowadays, the convenience and fast food industry is still being subdivided, and new brands are also cultivating here. Consumption scenarios, diversification of consumer groups, and fragmentation of channels still bring opportunities for new brands to stand out.” Liu Xingjian said.
Xu Xiongjun told reporters, “Whether it is a new brand or a traditional brand, the core is to do a good job in precise positioning and category innovation, and to cater to the consumption preferences of young people. In addition, good brand names and slogans cannot be ignored.”
Post time: Dec-15-2022