Chapter 31 1. Heavy domestic products

"In China, we know that the image of Wahaha is a healthy and happy child. Today, we are very happy to celebrate the birth of a child here. This is the five joint ventures we have with Wahaha. This child will integrate Chinese and European Excellent pedigree, inherited the excellent nature of his parents. We firmly believe that he will grow up healthily under our joint cultivation. Through the efforts of all our staff, and still under the care of Mr. Zong Qinghou, who is hardworking and capable, the joint venture will grow even more Fast pace to get development..." On March 28, 1996, in Hangzhou, Mr. Du Haide, President of Danone Asia Pacific, made a short and witty toast, announcing to the world the crystallization of a transnational "love".

On this day, the food company, beverage company, quick-frozen food company, health food company, and Baili Food Company under Wahaha officially entered into a joint venture with Danone of France and Peregrine Investment Group of Hong Kong.Danone and Peregrine made a one-time capital injection of US$45 million, accounting for 51% of the total share capital, while Wahaha Group, which holds 49%, is the largest shareholder of the three parties.Hong Kong Peregrine Group is an investment consortium with considerable achievements in Southeast Asia. Its investments cover 14 countries and regions. Many Chinese companies and Chinese-funded companies that are listed on the Hong Kong Stock Exchange or sell shares overseas are Peregrine Sponsored for listing. Around 1997, Peregrine was defeated by the Asian financial turmoil and went bankrupt. Danone purchased its shares and became the controlling party of the Wahaha joint venture.

Most Chinese people gradually get to know French Danone Group from Danone’s series of joint ventures in the Chinese market in recent years. In February 1966, two French glass manufacturing companies that produced bottles merged to form BSN. In 1973, BSN was reorganized into the new Danone Corporation.Since then, Danone's business has continued to expand from Europe to Asia and Latin America, and has grown into the fifth largest food group and the largest dairy company in the world, with annual sales exceeding 100 billion yuan.It owns Danone (Danone), Evian (Evian), Lu and other famous brands, especially the Evian mineral water produced in the Alps, which is famous all over the world. Danone yoghurt and Danone biscuit series have long been familiar to Chinese consumers.

What does the cross-border "love" between Danone and Wahaha mean, and what will it bring to Wahaha?Opening the "Wahaha Group News" on March 28, 1996, we can see such an ambitious text: "The history of Wahaha's development is a history of constantly seizing opportunities and surpassing itself. At the critical moment of its second venture, Wahaha attracted foreign capital of 45 million U.S. dollars, using international financial capital to strengthen its own strength and develop a national brand. Participate in a new round of market battle with a more high-spirited attitude, and will go to the world faster, and fully show the demeanor of Chinese enterprises on the international stage!"

Wahaha people are confident, and Zong Qinghou is even more confident.But the first reaction of many people who followed Wahaha was to sigh when they heard the news: the proud son of China's national drink will be overwhelmed by the wild waves of foreign capital again, and this is destined to be an unsuspecting ending. Indeed, they have too many reasons to be deeply concerned. With reform and opening up, China opened its doors to the world.Everything that comes pouring in is new to the closed countrymen who have been hungry for too long. After the mid-1980s, introducing foreign capital and taking the road of joint ventures has almost become a fashion, and many companies are flocking to it.On product labels and on the bronzing business cards of business owners, large and small, "Sino-foreign joint venture" has become a capital to show off and a selling point for promotion.There are 6 "Ariston" mixed-race sisters in just one refrigerator.

But after the heat wave, people discovered that things were far from that simple. Those who came across the ocean with colorful dollars in their pockets were no longer "comrades and brothers" "internationalist fighters".Under the coercion of the tide of foreign capital, Chinese national enterprises and national brands have begun to be perilous. Suzhou TV Factory has entered into a joint venture!As a result, the "peacock", which once amazed the whole country, broke its wings. Tianjin Daily Chemical No. 4 Factory has entered into a joint venture!As a result, the "golden rooster", which once occupied 50% of the national shoe polish market, no longer crowed.

Beijing Daily Chemical No. 2 Factory has entered into a joint venture!Therefore, the "Panda", which has dominated the world of detergents for many years together with Hubei's "Vigor 28" and Shanghai's "White Cat", has really become a national treasure that is increasingly difficult to find in the market. There are many more such lists: "Yangtze" refrigerator, "Golden Star" color TV, "Tianfu" Coke, "Maganet" cosmetics... "Foreign Army Overwhelms the Frontier, Hand in Hand—Domestic Famous Brands Are at Risk", "Foreign Capital Rolls in, National Brands Are Precarious", looking back at the 1990s, such shocking black and bold headlines can be seen everywhere in the media at that time.

Life is not easy for those who do not work with foreign capital, and they also fall into loneliness and helplessness. At the beginning of 1994, Pei Xuede, the new CEO of Eastman Kodak Company, the world's largest photosensitive material giant, visited China, expressed the idea of ​​acquiring all companies in China's photosensitive material industry, and promised to introduce world-class photosensitive technology into China.At that time, China's photosensitive material companies were in a state of loss in the entire industry. Only Shantou "Yuan Gong" and Xiamen "Fuda" had a cumulative loss of 7 billion yuan.After more than 70 rounds of negotiations in four years, the Chinese government agreed for the first time that an industry should be acquired by a foreign company. In April 1998, Kodak's formal acquisition of China's photosensitive industry was basically completed, involving a total of 7 photosensitive companies across the country, from Northeast China, North China, Shanghai, Xiamen to Shantou.

The only one that slipped through the net was the Lucky Group located in Baoding, Hebei. But Lucy clearly felt more and more short of breath, exhausted—— Sales: Founded in 1880, Kodak, which accounts for 40% of the world market, has global annual sales of more than 14 billion U.S. dollars, while Lucky is less than 100 million U.S. dollars; The transformation funds are less than 10 million US dollars; Internet: Lucky has about 1,500 printing chain stores, and Kodak has 7,000 in the Chinese market alone, and it is expanding at a speed of 3 to 4 every day. As early as a few years ago, Kodak had publicly stated that it would invest US$1.5 billion in the Chinese market without asking for anything in return, and its intention to squeeze Lucky was clear.It is said that in order to tenaciously survive and defend dignity, Du Changtao, the boss of Lucky, called on all employees to sing "The Chinese nation has reached the most dangerous moment... We are united and march forward against the enemy's artillery fire! Forward! Forward!" Not only that, the group The headquarters also often echoes the majestic "Internationale" melody: "There has never been a savior, nor does it depend on a fairy emperor." The emotion and scene are tragic and not without sadness.

Even Wahaha's family is no longer calm, and foreign capital and foreign brands are coming to the city, stirring up shocking waves. China is the hometown of tea, and tea is China's "national drink". Hangzhou, a paradise city, is known as the "Tea Capital" because of the fragrance of "Dragon Well".Unexpectedly, the tranquility of the "tea capital" that lasted for thousands of years was finally broken by a news in the spring of 1994 that "Foreign tea is imported, national tea washes hands". In the early 1990s, the "Lipton" black tea produced in Britain, which does not produce tea, broke into the Chinese market, and quickly became popular in hotels, restaurants, and entertainment venues all over the country, and penetrated into thousands of households. Only one sales point in Hangzhou set a new record. It has a record of annual sales of more than 8,000 boxes.What's more, some hotels in Hangzhou serve "Lipton" to entertain guests while dining, but the honorable "Longjing" is used to wash hands to remove fishy smell. The success of "Lipton" has greatly stimulated the British Crown Oriental Foods Co., Ltd., which produces "Liheng" black tea. At the end of 1995, after thorough market research and planning, "Li Heng" proposed to sell the total distribution rights in Hangzhou at a price of 3.8 million yuan for a five-year auction. Set up a "Lee Heng" billboard.Immediately, public opinion was in an uproar, shock, anger, and worry intertwined, causing an uproar.

Faced with the general trend of internationalization with no choice, what is the way out for domestic products?Many Chinese business operators who have tasted bitterness and bitterness lamented: If you don't have a joint venture, you will die, and if you do a joint venture, you will die. However, this rather universal "rule" obviously fails for Wahaha.What the joint venture with Danone brings to Wahaha is a recognized qualitative change in development on a higher platform.Here are the data to prove it - From 1993 to 1995, Wahaha's sales increased by an average of 100 million yuan per year, and its profit increased by 10 million yuan per year.From the joint venture in 1996 to 2000, sales were 1.11 billion yuan, 2.11 billion yuan, 2.87 billion yuan, 4.51 billion yuan, and 5.44 billion yuan, and profits were 155 million yuan, 334 million yuan, 501 million yuan, and 875 million yuan. Yuan and 906 million yuan. It can be said that without joint ventures to attract fresh water, strengthen muscles and bones, and expand horizons, the subsequent powerful offensives of the "Pure Water Campaign" and "Very Coke Campaign" would be unimaginable. More importantly, after the 7-year joint venture, Wahaha's flag has not fallen, and the brand is still there.As Mr. Du Haide, President of Danone Group Asia Pacific, said, "Wahaha", the golden signboard of Chinese national beverage, "is still under the care of Mr. Zong Qinghou's hardworking and capable hands".