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With the arrival of summer, bottled drinking water ushered in the annual peak consumption period. During this season, consumer demand for cool, thirst-quenching bottled water surges, and price becomes one of the most sensitive factors when choosing products. As a result, there is a price war in the bottled drinking water market at this time of year, and this year, the battle is particularly fierce.
For a long time, the bottled pure water market has maintained a relatively stable price range, mainly concentrated between 1.5 yuan and 2 yuan, in this range, the products of well-known brands such as Binglu, Wahaha, and Master Kong occupy a dominant position. Mineral water products below 2 yuan are fewer.
In May, Nongfu Spring entered the game with a new pure water with green packaging, and in June, Nongfu Spring further lowered the price of green bottle water, with an average selling price of less than one yuan.
In a supermarket chain in Beijing, the promotional price of 12 bottles of purified water is even as low as 8.9 yuan, which is 7 cents 4 per bottle.dropped a bombshell in the industry, which quickly ignited the fire of the price war in the market.
In the face of Nongfu Spring's fierce offensive, other brands have also responded. Wahaha, Cestbon and other bottled water giants launched preferential promotions. In some offline supermarkets, Wahaha 596ml purified water 12 bottles are only 11.9 yuan, Cestbon 555ml similar products are also affordable to the people, and Master Kong has launched a 380ml drinking water series at an ultra-low price of 0.65 yuan per bottle, which has further intensified the competition in the market.
The packaged drinking water industry is attractive and is a profitable industry, with a gross profit of more than 40%, of which bottles are the largest cost. Taking Nongfu Spring as an example, the cost of a bottle of water, bottle cap, and packaging materials accounts for 70%, while the cost of water is only 3%. And the barriers to entry in the manufacturing process of the packaged drinking water industry are not high, attracting more and more brands to start cross-border entry, hoping to take a share of this huge market. It is reported that Fat Donglai is about to launch a new self-operated natural mineral water, Yuanqi Forest will launch "Youmine" natural soft mineral water, Yili Group will launch "Yike Huoquan" natural mineral water, and Haitian Flavor Industry will launch drinking pure water.
China's top 10 packaged drinking water enterprises
According to the forward-looking collation, the top ten packaged drinking water companies in China in 2024 are summarized as follows (note: the ranking is in no particular order):
On the whole, the leading enterprises in China's packaged drinking water industry mainly include: Nongfu Spring, Cestbon, Wahaha, Jingtian, Master Kong, etc. These leading enterprises firmly occupy the leading position in the market by virtue of their advantages in brand, channel, supply chain and other aspects.
Nongfu Spring
According to the data of Qichamao, Nongfu Spring Co., Ltd. (hereinafter referred to as Nongfu Spring) was established in 1996 with a registered capital of 112,464.66 (10,000 yuan), and the legal representative is Zhong Sui, which is one of the top 500 private enterprises in China. In 2020, it was listed on the Hong Kong stock market, mainly engaged in water (55%), ready-to-drink tea (21%), functional drinks (11%), and fruit juice drinks (9%).
Nongfu Spring is a leading enterprise in packaged drinking water and beverages in China, with strong brand, product, R&D, marketing and channel power, as well as water source advantages. According to Frost &Sollivan data, from 2012 to 2019, Nongfu Spring maintained the largest market share of packaged drinking water in China for eight consecutive years.
Since its establishment in 1996, Nongfu Spring has successfully achieved a strategic layout of China's top 10 high-quality water sources, which are distributed in various regions of China, covering the supply of the national market. The official website of Nongfu Spring details the characteristics of each water source.
Nongfu Spring is a model of manufacturing scarcity to shape the brand, with brand management capabilities comparable to Coca-Cola, from the advertising slogan "Nongfu Spring is a little sweet" launched in 1997 to "We don't produce water, we are just the porters of nature" in 2008; In 2017, the slogan "What kind of water source, what kind of life is nurtured", these three advertising slogans have been talked about for nearly 30 years, building consumers' trust in the high-quality water source where they are located.
China Resources C'estbon
Founded in 1996 with a registered capital of 65,000 RMB and the legal representative is Zhang Weitong, China Resources C'estbon Beverage (China) Co., Ltd. (hereinafter referred to as China Resources C'estbon) Co., Ltd. (hereinafter referred to as China Resources C'estbon) Co., Ltd. is a professional beverage enterprise headquartered in Nanshan District, Shenzhen. CR Beverage is one of the earliest enterprises in China to launch professional packaged drinking water, mainly engaged in "Cestbon" brand series of packaged drinking water, and has become the second largest packaged drinking water enterprise in China and the largest drinking purified water enterprise in China.
In recent years, based on consumer demand, the company has expanded its business to sports drinks, coffee, milk drinks, sugar-free tea, milk tea, juice and other categories, and has successively launched new products such as afternoon milk tea, fire coffee, magic, and cestbon honey water. Up to now, CR C'estbon's sales network has covered most provinces and cities across the country. In 2019, "Cestbon" became the official drinking water of the Chinese national team, providing packaged drinking water and beverage products for more than 70 national sports teams.
The parent company of China Resources Beverage submitted a prospectus to the Hong Kong Stock Exchange on April 22. According to the data, Nongfu Spring and Cestbon ranked first and second respectively in China's packaged drinking water market in 2023, while Wahaha is the fourth largest packaged drinking water brand in China. In the purified water market, Cestbon and Wahaha won the first and second positions respectively.
The prospectus also shows that from 2014 to 2023, CR Beverage has been in the top two positions in terms of retail sales of packaged drinking water for 10 consecutive years. In 2023, CR Beverage's market share in the packaged drinking water market will be 18.4%.
Centennial Mountain
Jingtian (Shenzhen) Food & Beverage Group Co., Ltd. was established in 1992 with a registered capital of 800 (10,000 RMB) and the legal representative is Zhou Jingliang. Jingtian Group is a group enterprise focusing on the production of packaged drinking water, and Baisui Mountain is a well-known mineral water brand launched by the group
Different from brands such as Wahaha, Nongfu Spring, and Cestbon Mountain, Baisuishan focuses on natural mineral water. By taking the lead in occupying the drinking water health track, it has ranked first in the field of natural mineral water in China for 14 consecutive years.
Unlike natural water and mineral water, which are derived from lakes and reservoirs, the natural mineral water of Baisuishan needs to be mined. For example, hundreds of millions of yuan are invested in the mining cost of the Luofu Mountain water source every year. Today, with a market share of 9.6%, Baisuishan is the third largest brand in the domestic packaged drinking water market, after Nongfu Spring and Cestbon.
Wahaha
Hangzhou Wahaha Group Co., Ltd. (hereinafter referred to as Wahaha) was established in 1993 with a registered capital of 52,637.469 (10,000 RMB) and is headquartered in Hangzhou, Zhejiang Province, China. Among them, purified water, AD calcium milk, nutrition express, and eight-treasure porridge are well-known national products.
As of 2023, Wahaha has 81 production bases and 187 subsidiaries across the country, employing nearly 30,000 people. The company has been in the leading position in the industry for 20 consecutive years, ranking among the top 500 Chinese enterprises, China's top 500 manufacturing enterprises, and one of the top 500 private enterprises in China. Wahaha is one of the few enterprises in the food and beverage industry that has the ability to independently develop, design, and manufacture molds, beverage production equipment and industrial robots.
Before the launch of pure water, Zong Qinghou, the founder of Wahaha, discovered the use of reverse osmosis technology to make pure water during a foreign investigation, and decided to introduce this technology to produce it himself. Wahaha's purified water adopts two-stage reverse osmosis technology and ozone sterilization process to ensure the purity and safety of the product, and meet the needs of Chinese people for drinking water safety.
Ice dew
According to the data of Qichamao, Coca-Cola (China) Investment Co., Ltd. was established in 1995 with a registered capital
3,000 (US$ 10,000), and the legal representative is GILLESOLIVIERBENJAMINLECLERC. It is mainly engaged in the investment and reinvestment of China's beverage industry.
Ice Dew is a mineral water drink produced by Coca-Cola, which is commonly available in 330ml, 550ml (one piece), 1.5-liter and 5-gallon pails. It is one of the mainstream products in China's drinking water market and the only official drinking water for the 2008 Beijing Olympic Games.
Nongfu Spring, Cestbon, Baisui Mountain, Jinmailang, Master Kong, Binglu, Wahaha and other brands occupy more than 80% of the national bottled water market share, among which Binglu is the only product with the lowest positioning, and the price is only 1 yuan. Binglu has hardly been advertised, and only the official drinking water designated for the Beijing Olympics in 2008 is the only real advertising campaign.
Master Kong
Master Kong brand was born in 1992 by Taiwan entrepreneur Mr. Wei Yingzhou. Master Kong Holdings Limited (hereinafter referred to as Master Kong or Master Kong) is principally engaged in the production and sale of instant noodles, beverages, confectionery and related ancillary industries in China.
In February 1996, Master Kong Holdings was listed on the Hong Kong Stock Exchange, with a current market value of about HK$60 billion, ranking among the top 10 in the food and beverage sector of Hong Kong stocks.
According to the 2023 performance report, Master Kong's annual revenue reached 80.418 billion yuan, a year-on-year increase of 2.16%. The net profit was 3.117 billion yuan. From the perspective of business segments, the instant noodle business accounted for about one-third of the revenue, while the beverage business accounted for about two-thirds of the revenue. Beverages not only contribute the majority of the company's revenue, but are also a profitable business.
In April 2020, Master Kong entered the cooked water market and launched the "Drinking Boiled Water" product. Since its listing, the drinking water market has performed strongly, and the terminal has always maintained an efficient dynamic rotation, and by 2022, the sales of drinking boiled water have exceeded the 1 billion mark.
Jinmailang
Jinmailang Food Co., Ltd. was established in 2011 with a registered capital of 126,190.9769 (10,000 RMB), and the legal representative is Fan Xianguo.
Jinmailang Blue Label Purified Water is a popular bottled drinking water, and it is said that the annual sales volume has exceeded 9.6 billion bottles. This purified water uses advanced water treatment technology, which is filtered and purified in multiple stages to ensure the safety and hygiene of water quality. As a result, it is widely recognized as a high-quality drinking water suitable for daily drinking.
In 2016, based on the mental excavation of "Chinese drinking cooked water since ancient times", Jinmailang launched Jinmailang Liangbai Kai differently, so that the health concept of "cooked water" entered the hearts of consumers, and it was sold to 2 billion in 3 years.
Previously, the main brands in the 1 yuan water market were Jinmailang Blue Label Water, Ice Dew Pure Water, etc. Fan Xianguo, chairman of Jinmailang Group, positioned its 1 yuan blue label water as "national ration water".
Kunlun Mountain mineral water
Kunlun Mountain Mineral Water Co., Ltd. was established in 2007 with a registered capital of 8,833.92 (US dollars), the company is located in Golmud City, Qinghai Province, is a subsidiary of JDB Group, producing high-grade bottled mineral water of Kunlun Mountain Natural Snow Mountain Mineral Water.
In terms of water sources, Kunlun Mountain has achieved double uniqueness: the only mineral water factory on Yuzhu Peak in Kunlun Mountain, and the only water source of mineral water in Kunlun Mountain Yuzhu Peak.
According to the data, Kunlun Mountain mineral water has won the first place in the sales volume of 618 domestic high-end water e-commerce for 8 consecutive years.
Watsons
When it comes to Watsons, the outside world is no stranger. As the world's largest health and beauty retailer, A.S. Watson has more than 16,400 stores in Asia and Europe. A.S. Watson Group is one of the retail businesses of CK Hutchison Holdings Limited, a company founded by Li Ka-shing. According to the official website of A.S. Watson Group, the company owns the world's largest distillation plant and is the only company in Hong Kong that produces its own retail, commercial and household bottled water, and has expanded this business to Chinese mainland.
According to public information, Watson's mineral water began in 2019 and sold nearly 5 billion yuan in 2021, surpassing Kunlun Mountain and Evergrande in sales, approaching Uni-President Mineral Water (5.8 billion yuan).
Evian
Evian is a mineral water brand positioned in the high-end market under the Danone Group. The brand originated in a small town in France and is known for its pure, natural mineral water. Danone Group is a leading global food and beverage company with operations in many countries and regions around the world, focusing on health, fast-growing sectors, and providing professional nutrition and health products and services.
Danone Evian Food Marketing (Shanghai) Co., Ltd. is a wholly-owned subsidiary of Danone Group. Responsible for the business of the world-renowned mineral water brands Evian natural mineral water in France, Fuvic natural mineral water, Evian spray and other products in the Chinese market. ACCORDING TO QICHAMAO, THE COMPANY WAS FOUNDED IN 2007 WITH A REGISTERED CAPITAL OF 1,500 (10,000 YUAN), AND ITS LEGAL REPRESENTATIVES ARE ANTOINE, ERIC, CLAUDE, AND MARIE PORTMANN.
Analysis of the current situation and prospect of the packaged drinking water industry
Continental packaged drinking water originated in 1930, and after decades of development, it has become the first subdivision of the soft drink industry.
As a kind of water that has been processed and processed and can be directly consumed, packaged drinking water is becoming more and more diverse, including drinking natural mineral water, drinking pure water, drinking natural spring water, drinking natural water and other types, which meet the diverse needs of different consumers. Among them, natural mineral water is often regarded as a representative of high-quality drinking water with its unique mineral content and pure water quality, while drinking pure water has won a wide market with its simple and pure characteristics.
In 1998, the drinking water market was already a group of champions, with brands such as Wahaha and Robust leading the way. However, it is in this Red Sea that Nongfu Mountain, which has just been established, has greatly helped Nongfu Spring achieve a "turnaround against the wind" with the advertising slogan "Nongfu Spring is a little sweet".
With the trend of consumption upgrading, consumers are paying more attention to the quality of drinking water, and household demand is driving the growth of packaged drinking water sales. From 2011 to 2021, the sales of packaged drinking water increased year by year, but the growth rate gradually slowed down. By 2021, the sales volume of packaged drinking water in mainland China reached 50.806 billion liters, a year-on-year increase of 5.11%.
Although the growth rate of packaged drinking water sales has slowed down in recent years, the industry as a whole still maintains a steady growth trend. According to the forecast of the Prospective Industry Research Institute, the scale of the mainland packaged drinking water market will continue to expand in the next few years, and is expected to reach 309.1 billion yuan by 2027.
Recently, there has been a fierce price war in China's bottled water market. Some experts believe that the outbreak of price wars is usually due to intensified market competition, changes in consumer demand, or corporate strategic adjustments. Some leading brands such as Nongfu Spring have adopted a low-price strategy, perhaps to attract new market entrants, consolidate market share, increase brand exposure, and use the advantage of scale to reduce costs to attract price-sensitive consumers.
Zhu Danpeng, an analyst of China's food industry, said that this year, Nongfu Spring has become a "disruptor" in the pure water market by listing pure water products and launching a low-price strategy. However, price reductions are not a long-term solution and "could lead to market disruption and damage to brand image." ”
With the trend, the consumer demand for high-quality, healthy and convenient drinking water is increasing. In the future, bottled water companies will continue to seek new growth points from multiple dimensions such as water source selection, packaging technology innovation, and environmental protection concept promotion, and are committed to improving the market competitiveness of their products. At the same time, with the development of science and technology, the bottled water industry is also expected to achieve more intelligent and convenient development through technological innovation to meet the diverse needs of consumers.
Prospective Economist APP Information Group
For more research and analysis of this industry, please refer to the "Production and Marketing Demand and Investment Forecast Analysis Report of China's Soft Drink Industry" by Qianzhan Industry Research Institute
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