Plummeted by 100 billion! Why does China's "God of Medicine" always go the wrong way?

Golden wrong knife

2024-06-03 18:15Published in Beijing

Yunnan Baiyao, the light of domestic products, has been really tossed miserably recently!

In the past few days, Yunnan Baiyao issued an announcement saying that the three major directors suddenly resigned.

Before this great change, the top management of Yunnan Baiyao was already in turmoil.

In May this year, Yunnan Baiyao exposed a major corruption "nest case", and five executives, including the former chairman and CEO, were investigated one after another.

Unlike most time-honored brands struggling on the line of life and death, Yunnan Baiyao has always lived a very strong existence:

In 2023, Yunnan Baiyao's revenue will be 39.1 billion yuan, and its net profit will exceed 4 billion.

But since last year, this century-old medicine king has almost no positive news on the hot search: collective resignation, senior executives being investigated, exposing nest cases, and indulging in stock speculation......

Yunnan Baiyao, can it escape this catastrophe?

One man, two ace products

The first man to change the fate of Yunnan Baiyao is also the former chairman of Yunnan Baiyao, Wang Minghui, who resigned in the personnel upheaval.

This top trader can be called the soul of Yunnan Baiyao, and even saved Yunnan Baiyao from fire and water.

Wang Minghui used to be vice president of sales from Kunming Pharmaceutical Factory, and officially became chairman in 2004, and has been at the helm of Yunnan Baiyao for 19 years.

The reason why it can be called the top is because Wang Minghui has made foreign giants fall behind.

At that time, Yunnan Baiyao was being beaten by Johnson & Johnson of the United States and couldn't raise its head:

In the past, Yunnan Baiyao's flagship product was Baiyao powder, which could sell hundreds of millions of bottles a year, but Johnson & Johnson's band-aid brand Bondi was born, and people no longer need to apply medicine and gauze to deal with trauma, and a small band-aid can do it.

Seeing that the national enterprises are losing more and more, Wang Minghui quickly found the loophole in the United States:

The core function of the band-aid product invented by Bundy is to protect the wound from being re-infected by bacteria and impurities; But our ancestors' Yunnan Baiyao is different, it can protect and treat more, and it is simply a dimensionality reduction blow.

So, in 2001, Yunnan Baiyao also launched its own brand of Band-Aid, which added Baiyao that can stop bleeding and reduce inflammation to the absorbent pad of the Band-Aid.

In 2001, Yunnan Baiyao Band-Aid was trial-marketed in the Beijing market, achieving a revenue of 30 million yuan that year.

By 2007, Yunnan Baiyao Band-Aid regained its position as the king of China's wound hemostasis market with a market share of 40%.

That's how making money is, you make the first punch and the inspiration that follows is endless.

Wang Minghui took advantage of the trend to create another phenomenal product: Yunnan Baiyao toothpaste.

In 2001, a user wrote to Yunnan Baiyao that he sprinkled Baiyao powder on toothpaste: after a few days of use, he felt that the effect was good.

After reading the letter, Wang Minghui immediately smelled a business opportunity. In 2005, the first Yunnan Baiyao toothpaste was born, pushing Yunnan Baiyao to its peak.

The success of Baiyao toothpaste is mainly based on two strategies: one is the high price, the price of more than 20 yuan is equivalent to two or three times that of ordinary toothpaste, which is different from Colgate, Crest and other well-known brands; The second is the channel model of "pharmacy + supermarket".

According to Yunnan Baiyao's 2005 annual report, the sales of Yunnan Baiyao toothpaste that year were close to 80 million yuan. In 2021, the market share of Yunnan Baiyao toothpaste will reach 23%, becoming the well-deserved No. 1 brand of toothpaste.

Wang Minghui also launched the strategy of "stabilizing the central government and highlighting the two wings (100 million)" for Yunnan Baiyao: that is, on the premise of maintaining the steady growth of leading products such as Baiyao capsules, strive to exceed 100 million yuan in Yunnan Baiyao ointment, Yunnan Baiyao band-aid and Yunnan Baiyao toothpaste.

Relying on this product strategy, the sales revenue of Baiyao exceeded 10 billion yuan in 2010. During Wang Minghui's tenure, Yunnan Baiyao's revenue grew from the initial 200 million yuan to 39.111 billion yuan.

The God of Medicine Becomes the God of Gambling:

The time-honored brand plummeted by 100 billion, all because of its addiction to stock speculation?

The second man who changed the fate of Yunnan Baiyao is called Chen Fashu.

Long before entering Yunnan Baiyao, Chen Fashu was already a big man in China's business community and capital market.

Chen Fashu is good at investment and is known as "China Buffett". Moreover, he has a strong ability to make money, and has become the richest man in Fujian with a personal wealth of 21.85 billion yuan.

Chen Fashu and Yunnan Baiyao had a wonderful fate, thanks to Wang Minghui.

When the two bigwigs were in class at Cheung Kong Graduate School of Business, Chen Fashu "fell in love" with Yunnan Baiyao, and since then he has been stumbling in order to enter Yunnan Baiyao.

It was not until 2016 that the shareholders of Yunnan Baiyao were restructured, and Chen Fashu finally successfully entered the game.

At the beginning, Chen Fashu was extremely concerned about the development of Yunnan Baiyao. According to reports, he only received a symbolic salary of 1 yuan in Yunnan Baiyao, and the financial report showed that Chen Fashu received a pre-tax remuneration of 0 yuan from Yunnan Baiyao in 2023.

At the end of 2019, Chen Fashu also engaged in research and development with Peking University, and the academic achievements belonged to Peking University, and the research and development results belonged to Yunnan Baiyao.

Chen Fashu publicly shouted, "If you don't invest in white medicine, in fact, I will use more than 20 billion yuan to make more money by speculating in stocks." But since I've been given this opportunity, I'm going to give it my all. ”

But soon, the genes flowing in his blood to invest in stocks could not be suppressed, and Chen Fashu took Yunnan Baiyao to embark on a crazy investment road.

Yunnan Baiyao has invested a lot of money in the field, you may not imagine how wide the net of Yunnan Baiyao is:

invested 1.632 billion yuan in Xiaomi Group and 887 million yuan in Yili, what Tencent, Meituan, Kweichow Moutai, and Yunnan Baiyao are getting more and more crazy...

Don't say it, Chen Fashu does have some strength - he earned 227 million in 2019 and 2.24 billion in 2020, accounting for 40% of the profit of that year.

The money was earned, but it was scolded bloody.

Yunnan Baiyao, as a national brand of traditional Chinese medicine, should it be so naked and directly go to stock speculation?

But obviously, at this time, Yunnan Baiyao could not stop completely: the funds for stock speculation increased 100 times from the initial 1 billion!

Throughout 2020, Yunnan Baiyao used 13.8 billion yuan for securities investment, reaching more than 20 billion yuan at its peak. Yunnan Baiyao's investment in R&D continued to decline, and in the end it only accounted for 0.7% of revenue, ranking relatively low in the traditional Chinese medicine industry.

Starting from 2021, Yunnan Baiyao's stock speculation has encountered a "Waterloo", with a cumulative loss of more than 2.5 billion in two years. Some netizens joked that Yunnan Baiyao made money while harvesting leeks, and at the same time went to be leeks themselves.

At the same time, the losses caused by stock speculation made shareholders buckle a hat of "not doing business" for Yunnan Baiyao, and the company's market value was cut in half, from 200 billion to 100 billion.

The road from the god of medicine to the god of stocks, declared a failure.

The richest man is out, who can save Yunnan Baiyao?

What is worse than losing money in stock trading is losing reputation.

Originally, Yunnan Baiyao was the largest leading stock in the traditional Chinese medicine sector, but this position was also snatched away by Pien Tze Huang, and it has not been taken back until now.

Finally, in 2023, Yunnan Baiyao realized that it had lost its way and completely withdrew from all securities investment in the secondary market.

In January this year, Yunnan Baiyao finally made up its mind and announced that it would no longer "speculate in stocks".

Although the richest man in Fujian has left the market, Yunnan Baiyao is not without a chance to make a comeback, in the final analysis, it is four words: product is king.

Compared with other time-honored brands that have either been acquired or died, Yunnan Baiyao is an extremely resistant brand.

The way Yunnan Baiyao became famous is very unique.

After the Battle of Taierzhuang that year, the troops investigated and found that it was precisely because of the use of 30,000 bottles of Wanying Baibaodan donated by Qu Huanzhang that the death and casualty rate of the Dian army was much lower than that of other teams.

Later, Qu Huanzhang's widow donated the secret recipe of Baibaodan to the Kunming government. Wanying Baibaodan was officially renamed Yunnan Baiyao, and its prescription and process were listed as "state secrets", and the confidentiality period was permanent.

On this point alone, Yunnan Baiyao has won many opponents.

What's even more rare is that in fact, Yunnan Baiyao did not rely on top-secret formulas to "lie down" and eat the old book, but its innovation ability is also very online among all time-honored brands - there is no nonsense, and even many popular products have been born.

Yunnan Baiyao Band-Aid, with a current market share of more than 65%, killed Bondi;

Yunnan Baiyao aerosol is the only double-bottle double-effect aerosol, which has been selling well for more than 20 years;

Yang Yuanqing, which was born a few years ago, has also become the light of domestic products for many workers with hair loss.

Today's young people have become more fond of domestic products, and the time-honored brands at this time should return to their main business, take out product advantages, and occupy the initiative.

In fact, Yunnan Baiyao is not the only time-honored brand that indulges in stock speculation.

Lanzhou Huanghe, the "Northwest Beer King", has been speculating in stocks for more than ten years, and the company's stock purchase funds once reached 262 million, about 50% of the year's revenue.

Men's clothing giant Youngor, when he was addicted to "stock speculation", once spent 9.6 billion yuan to buy stocks, accounting for half of Youngor's net worth at that time, but he didn't expect the stock price to fall all the time, and the result was a huge loss.

The founder once bluntly said: "The profits earned by investing in real estate and financial securities are not earned by Youngor clothing for 30 years." ”

But I have to admit that stock speculation is a crumbling money bag, and the product is the most capable initiative.

The golden signboard, don't destroy it in the hands of capital!

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