Fulfilling the diversification strategy, frustrating

On November 1st, recently, Qiaqia Foods announced the sale of its shareholding in Shanghai Qiaqi Food Co., Ltd., and the company plans to sell 60% of the shares held by Shanghai Qiaqi to Hefei Huatai Group. The relevant person in charge of the agreement said that the transaction is to further effectively integrate resources and optimize the asset structure. However, this is actually a setback in the development of diversification strategy, and it is helpless to face the decline in performance.

Prior to this, Qiaqia Foods also sold 100% equity of Jiangsu Qiacon in mid-October, Hefei Huatai and Huanghai Trade were transferred to Qiaoke Foods Co., Ltd. to hold 100% equity of Jiangsu Qiacon, and Jiangsu Qiacon became a holding subsidiary of Hefei Huatai. Understand that Jiangsu Qiacon is mainly engaged in the production and sales of beef sauce and other condiments. In addition, in August, Qiaqia Foods also sold 100% of the wholly-owned subsidiary Baotou Huakui Trading Co., Ltd., which is mainly engaged in the sunflower seed trading business. The industry believes that Qiaqi Food has repeatedly sold its subsidiaries in order to divest non-performing assets, integrate resources, and focus on the development of the seeds and nuts industry.

In recent years, the melon seed market has become saturated, and Qiaqi, which is close to the ceiling, has to seek diversified development, but it has been frustrated frequently. In 2010, Qiaqia Foods began to get involved in the potato chip industry. However, after experiencing a rapid growth in revenue in 2011 to nearly 300 million yuan, this part of the performance has declined. It has remained stagnant at an annual average of 200 million yuan. In 2013, Qiaqia Foods launched the jelly product, but it was stripped of its product sequence due to a two-year cumulative loss of nearly 20 million yuan. The blind diversification strategy has not only become a new performance growth point, but also brings challenges to the operation of the company.

As the latecomers with the Internet genes in the snack food industry have sprung up, the pressure on Qiaqi is growing. Nuts and nuts are the fastest growing E-Commerce business. In 2015, sales were 8.5 billion yuan. In 2016, sales exceeded 11 billion yuan, a growth rate of 30%. According to Wind data, in 2017, the sales of the main competitors and the three squirrels were 6 billion yuan and 5 billion yuan respectively, and ranked the top two in the industry, and Qiaqi Food just over 3.5 billion yuan. The revenue scale fell to the third in the industry.

The herbaceous taste that also benefits from online sales channels has also risen rapidly in recent years. In 2017, the sales volume of Baicaowei exceeded 4 billion yuan, a year-on-year increase of 42.96%. In 2011, the sales of Baicaowei was only 0.23 billion yuan. As of April 27, 2018, the number of fans of the three squirrels, the good shop and the herbaceous Tmall flagship store were 17.062 million, 15.077 million and 12.9 million, respectively, while the number of fans of the official flagship store of Qiaqi Foods was only 550,000. The gap is very obvious. This is mainly because Qiaqi Foods only started the online sales model in 2015, and missed the Internet dividend, which led to a gradual increase in the gap between fans and competitors.

Faced with the frustration of the sideline business and the lack of competitiveness of the online channel, Qiaqia began to refocus on the main business, expand online channels, and carry out strategic transformation again. At present, the main products are Qiaqiaguazi and Qiaoxi small yellow bag daily nuts. However, the daily nut market has already entered the Red Sea market, and the competition is fierce. Although the revenue exceeds 100 million, it does not drive the overall performance growth of Qiaqi Food. Recently, Qiaqia and Jingdong have carried out strategic cooperation in the B2B business field of snack foods. Perhaps the channel disadvantages with competitors on Taobao are obvious. They want to seek a “new way out”, but the competitors have already settled in Jingdong Mall, and they still do not negotiate. Predominate.

At present, the road to transformation of Qiaqia needs to face many challenges. Qiaozhao should focus on the main business and expand the original business in areas of good use. It should also strengthen the construction of E-Commerce channels and integrate online and offline. Development can get rid of the predicament.