Core Viewpoint - The journey of Kuozi Jiao reflects the fluctuations and challenges within the liquor industry, highlighting its recent struggles after a period of rapid growth [1][3]. Group 1: Company Performance - Kuozi Jiao achieved significant revenue growth after its IPO in 2015, with revenues reaching 2.584 billion yuan and net profits of 605.4 million yuan in its first year [1]. - By 2018, Kuozi Jiao's revenue soared to 4.269 billion yuan, with net profits hitting 1.533 billion yuan, solidifying its position as the second-largest player in the Huijiu industry [1]. - However, in the first half of this year, Kuozi Jiao's revenue fell to 2.531 billion yuan, a year-on-year decline of 20.07%, while net profit dropped to 715 million yuan, down 24.63% [3]. Group 2: Market Dynamics - The decline in Kuozi Jiao's performance is attributed to significant changes in consumer behavior, particularly the reduction in government and business banquets, which weakened the core driving force of its "pan-in-pan" model [4]. - The shift towards wedding and family consumption has led to a substantial decrease in average transaction value [4]. - Kuozi Jiao's "big merchant system" has also shown weaknesses, as the reliance on large distributors has resulted in a loss of control over terminal sales, impacting the sales of new products [4]. Group 3: Strategic Challenges - Kuozi Jiao attempted to reform its distribution channels by cutting ties with large distributors to shift towards a manufacturer-led marketing model, but the results have been underwhelming [4]. - In the first half of this year, wholesale agency revenue fell by 21.26%, a decline greater than the overall revenue drop, indicating challenges in adapting to the new market environment [4]. - Despite some growth in direct sales (including group purchases), it has not been sufficient to offset the losses from wholesale agency sales [4].

Core Viewpoint - The liquor industry, particularly the white liquor segment, is currently experiencing a downturn, with companies like Kuozi Jiao facing significant performance declines and losing market positions [2][3]. Company Performance - Kuozi Jiao's revenue for the first half of the year was 2.531 billion yuan, a year-on-year decline of 20.07%, with net profit dropping by 24.63% to 715 million yuan [2][6]. - In Q2, Kuozi Jiao's revenue fell to 720.7 million yuan, down 48.48%, and net profit decreased by 70.91% to 104.6 million yuan [2][6]. - In contrast, Yingjia Gongjiu achieved revenue and net profit of 3.16 billion yuan and 1.13 billion yuan respectively in the same period, widening the gap with Kuozi Jiao [2][6]. Historical Context - Kuozi Jiao was established in 1997 and initially faced survival challenges due to intense competition in the liquor market [4]. - The company successfully adopted an innovative sales model known as the "Pan-Zhong-Pan" model, which significantly contributed to its growth and market presence [4][5]. Marketing Strategies - The "Pan-Zhong-Pan" model focuses on high-end consumption through business banquets, which has become a classic marketing strategy in the white liquor industry [5]. - The "Da Shang Zhi" distribution system allowed Kuozi Jiao to grant exclusive distribution rights to single large distributors, stabilizing pricing and reducing costs for the company [5][6]. Market Challenges - The decline in Kuozi Jiao's performance is attributed to a slowdown in revenue growth, with growth rates of 2.12%, 16.1%, and 0.89% from 2022 to 2024 [7]. - The "Pan-Zhong-Pan" model has become less effective due to changing consumption patterns, with a significant reduction in business banquets [8]. - The "Da Shang Zhi" system has also faced challenges, as distributors prioritize mature products over new offerings, leading to stagnation in sales [8][9]. Current Situation - Kuozi Jiao's high-end liquor revenue was 2.385 billion yuan, down 19.8%, while mid and low-end liquor revenues saw smaller declines [8]. - The company has recognized the need for channel reform and has attempted to shift from a distributor-led model to a manufacturer-led approach, but results have been limited [9].