Sou Hu Cai Jing·2025-11-10 04:27Core Viewpoint - The performance of the liquor industry in Q3 2025 experienced the largest quarterly decline in nearly a decade, indicating a significant adjustment phase that requires a comprehensive assessment of the industry's current state, core causes, and future transformation directions [1] Group 1: Industry Trends and Future Outlook - The downward trend may be nearing its bottom, with a potential turning point expected in Q1 2026, as the current decline is likely a short-term adjustment rather than the onset of a long-term downturn [3] - Multiple institutions have identified Q3 2025 as a phase of low valuation for the industry, with negative factors such as high inventory and weak consumption already fully released, reducing the likelihood of further demand decline [3] - The macroeconomic environment is expected to improve, with a recovery in consumer confidence and gradual inventory clearance, which will help revive core consumption scenarios like business banquets and gifting [3] - Leading companies like Kweichow Moutai and Shanxi Fenjiu continue to show positive revenue growth, demonstrating strong risk resistance capabilities [3] Group 2: Causes of Industry Adjustment - The current performance decline is attributed to a combination of short-term cyclical pressures and long-term structural changes, which determine the depth of the adjustment and the necessity for transformation [7] - Short-term pressures include severe channel inventory backlog, extended turnover cycles, and external factors like the ban on alcohol for official receptions, which have further contracted high-end consumption scenarios [7] - Long-term structural changes are characterized by a generational shift in consumer preferences, with younger consumers favoring lower-alcohol and fruit-based beverages, leading to a decline in the market share of traditional liquor [7] Group 3: Industry Restructuring and Company Survival - The current adjustment represents a convergence of industrial, consumption, and policy cycles, presenting both challenges and opportunities for industry reshuffling, resulting in a "strong survive, weak exit" scenario [11] - Companies are shifting from a "big product" strategy to developing lower-alcohol, lighter, and flavored products, while also expanding into new consumption scenarios like casual drinking and outdoor activities [11] - Traditional channel models are collapsing, prompting a shift towards chain and digital models to enhance industry concentration and resolve the "strong factory, weak distributor" conflict [11] - Over 4,800 liquor-related companies have been deregistered or revoked in the past year, primarily affecting small brands reliant on regional distribution and mid-range products, indicating a risk of elimination for companies lacking brand strength and innovation capabilities [11] Group 4: Conclusion - The significant drop in performance in Q3 2025 is viewed as a "growing pain" for the liquor industry amid short-term pressures and long-term transformations, rather than the beginning of a prolonged downturn [14] - With inventory clearance, consumption recovery, and corporate transformation, the industry is expected to reach a turning point in Q1 2026, but companies must innovate across products, channels, and marketing to meet the evolving demands of a new generation of consumers [14]