Shede Spirits (SH:600702) 阿尔法工场研究院·2025-10-17 00:03Core Viewpoint - The article highlights the significant decline in the demand for traditional Chinese liquor, particularly during peak seasons, driven by changing consumer habits and economic factors, leading to increased inventory and financial pressure on distributors [2][21][27]. Group 1: Market Conditions - The demand for banquet room reservations in the restaurant sector has dropped significantly, with a reported 20% decrease in Henan province [22]. - The overall sales of Chinese liquor have seen a year-on-year decline of 15% to 20% during the recent Mid-Autumn and National Day holidays, surpassing earlier industry expectations of a 5% to 10% drop [21]. - Distributors are facing challenges with high inventory levels and cash flow issues, leading some to sell products at lower prices to generate cash [10][27]. Group 2: Company Performance - Shede Liquor (600702.SH) is experiencing weak national sales and inventory buildup, with some products remaining unsold for nearly four months [6][10]. - The company has launched a new product, "Shede Zizai," aimed at capturing the low-alcohol market, which initially generated excitement but has since seen lower-than-expected sales [11][15]. - The pricing of Shede's main products has been under pressure, with "Zhihui Shede" priced around 450 yuan, leading to minimal profit margins for distributors [6][10]. Group 3: Consumer Behavior - Traditional consumption scenarios for liquor, such as weddings and corporate gifting, are declining, with many consumers opting for non-alcoholic beverages [26][24]. - The shift in drinking habits is evident, with reports of entire tables at weddings not consuming alcohol, reflecting a broader trend towards healthier lifestyles [25][26]. - The younger generation shows a decreasing interest in liquor, with a preference for soft drinks over traditional spirits [26]. Group 4: Industry Trends - The white liquor industry is facing a structural shift, with key consumption scenarios like weddings, gifts, and business events all under pressure, leading to a systemic decline in demand [26][27]. - The industry is experiencing a price flattening trend, with some premium brands selling below their cost price, a situation not seen in the past decade [27]. - Future projections suggest that the industry may enter a phase of channel concentration similar to that seen in electronics, with distributors taking on roles more focused on logistics rather than profit generation [30].