Summary of Key Points
This article highlights four “abnormal phenomena” recently occurring in the liquor industry: the sudden surge in interest in bulk alcohol sales, which have gone from being neglected to highly sought-after; the instant retail sector, which has been hyped as a trend but is viewed with mixed feelings by manufacturers; the significant disconnect between institutional analyses (such as those from Goldman Sachs) and the actual market conditions; and the entry of milk tea chains into the alcohol business to target young consumers. Behind these phenomena lie collective anxiety within the industry, short-term profit-seeking by capital, the clash between traditional models and new consumer demands, and a rift in industry perception. Some are merely speculating on trends to make quick profits, while others are seeking new opportunities, yet many fail to understand the real needs of young consumers.
1. Bulk Alcohol Stores: From “Neglected” to “Desired”
In the past, bulk alcohol sales were considered a minor business by leading liquor companies, focusing on local markets and rural areas. This year, however, they have become highly sought-after. Well-known brands like Gujing Gong and Kouzi Jiao have opened their own direct bulk alcohol stores, and new chains such as Tang San Lian are gaining popularity. Even the milk tea chain Mixue Bingcheng has entered the market with its “Xian Pi Fu Lu Jia” brand. Why this sudden surge? It is essentially a reactive response to industry anxiety: the competition in boxed and bare-bottle alcohol sales is fierce, leaving manufacturers with excess inventory, while retailers are looking for new ways to attract customers and capital is creating new buzzwords. However, there are pitfalls. Brands entering the bulk alcohol market are mainly doing so to clear their inventory (which accounts for a tiny portion of their financial reports), and new players often use strategies like the “milk tea model” to charge franchise fees. The core of bulk alcohol sales is affordable, everyday drinking alcohol, and successfully operating a single store is impressive, but it’s unlikely to support the capital dreams of expanding into a nationwide chain. Warning: If you enter the bulk alcohol business, consider carefully whether it’s a temporary solution or truly aligns with your resources. Why should your store outperform those nearby?
2. Instant Retail: “Half-Hour Delivery” – A Trend or a Problem?
Gigants like Meituan and JD.com, as well as specialized platforms like Wei Ma and Jiu Xiao Er, and established players like 1919, are all competing in the instant retail sector, offering half-hour delivery services. This model didn’t emerge from new consumer demands but rather from capital taking advantage of manufacturers’ lack of pricing power to gain market share through subsidies. The mixed feelings among manufacturers stem from both the added sales channel and the impact on prices (for example, selling alcohol at low prices can damage brand value). Small store owners appreciate the subsidies but resent the high fees charged by platforms for delivery and marketing. This is similar to the competition in ride-hailing services: platforms invest heavily to create customer dependence on low prices, which may disappear once subsidies stop. Worse still, small stores that rely on platform traffic lose their existing customer base and lack online operations skills, potentially ending up being exploited by the platforms. Warning: Are platforms merely building infrastructure or exploiting businesses?
3. Institutional Analyses vs. Market Reality: Why Does Goldman Sachs Say Recovery, While Manufacturers Feel It’s Harder?
Last month, Goldman Sachs stated that the liquor industry had passed its most difficult inventory-clearing phase and was entering an early stage of recovery. However, distributors and small liquor store owners find things even tougher than last year. The issue lies in two major misalignments:
1. Sample Misalignment: Goldman Sachs focuses on a small subset of leading companies (the top 1% of the industry), whose valuations have risen after inventory clearance, while 99% of smaller manufacturers experience declining business.
2. Perspective Misalignment: Goldman Sachs’ reports are aimed at capital, providing investment opportunities during market downturns, not practical guidance for businesses. What merchants need is a way to sell products and make profits, not just recovery signals on financial charts. In reality, Goldman Sachs’ profit forecasts have been lowered, yet its statements about recovery serve more to soothe investor sentiment rather than provide real help.
4. Milk Tea Chains Entering the Alcohol Business: Not Just a Change in Product, but a Shift in Target Market
Milk tea chains like Ba Wang Cha Ji and Xi Cha are introducing beer-flavored drinks, while Mixue Bingcheng has invested $300 million in the fresh beer brand Fu Lu Jia (with over 3,000 stores). Why this shift? The industry’s growth is stagnating, so they’re looking for new areas of expansion. However, their goal is not to compete with existing白酒 or industrial beer markets but to capture the young consumer market and define the “micro-drinking” experience. Young consumers want beverages that don’t make them drunk and that can be shared on social media; they prefer to buy alcohol at familiar milk tea stores. These chains have a strong customer base and a convenient location, turning “micro-drinking” into a regular part of daily life. A reminder to traditional liquor companies: Don’t stick to outdated approaches (like focusing only on premium products or relying on traditional sales channels); otherwise, you’ll miss out on this generation of consumers.
Conclusion
These “abnormal phenomena” reveal the industry’s impatience, anxiety, and lack of clear understanding. To succeed, businesses need to focus on real consumer needs and genuine value, rather than short-term capital-driven trends or fabricated stories. Traditional liquor companies must realize that if they don’t adapt to the changing preferences of young consumers, they will miss out on the growing micro-drinking market.