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zong fuli made a rare response to the lawsuit.

arts｜《hu nannan, reporter of china entrepreneurs

edit｜mina

head photo by deng pan

wahaha is in a turbulent period.

following the resignation of zong fuli in july, wahaha was exposed to the rights protection incident of old employees in early september. according to china industry news, several wahaha group employees revealed that because wahaha group required employees to re-sign labor contracts and buy back the shares of the employee stock ownership association at a lower price, they had to spontaneously set up a rights protection association and formally filed a lawsuit.

in response to the lawsuit, zong fuli made a rare response yesterday.

china entrepreneur learned from wahaha thatat the 8th employees' congress of wahaha group held on the 18th, zong fuli promised employees, "wahaha's stock dividend will not be cancelled this year, and the salary structure will not change. but the dividend will be based on individual job performance, not just on past qualifications or levels."

it is understood that after reaching its peak in 2013, wahaha's operating performance has been under pressure ever since. a post-90s wahaha employee once expressed such confusion: "even if i devote myself to work, the compensation i get is not as much as the year-end bonus of a colleague with more seniority."

based on this background, wahaha made the important decision to repurchase shares from old employees six years ago.

this class action lawsuit also targets the repurchase six years ago.

it is reported that in these lawsuits, wahaha group employees, on the one hand, demanded that the 2018 equity repurchase be declared invalid and that the employees' shares in the shareholding association be reconfirmed. on the other hand, they demanded that the employee shareholding association and zong fuli provide further explanation and clarification on the employee equity repurchase in 2018, including the source of the repurchase funds and the repurchase price.

in this regard, zong fuli bluntly said that there is still a mentality of "free riding" and "riding the fast boat" within wahaha. the purpose of introducing the "catfish" of performance is to break the big pot.

in the early years, zong fuli launched a series of reforms when she was in the wahaha brand department. when wahaha transitioned from the 1.0 stage to the 2.0 stage, she also saw the effectiveness of the reform. therefore, at the staff representative meeting, she also frankly stated her reform goals - based on the "family culture", using the corporate culture of hard work to achieve a hardworking wahaha; using a comprehensive corporate system to achieve a refined management wahaha.

although zong fuli has been "overcoming difficulties" since taking over, the turmoil has not stopped yet.

at present, the core of the storm is the series of reforms carried out by zong fuli after taking over, which has affected the interests of some old employees of wahaha. in fact, for the current wahaha,if you want to change the status quo, change is inevitable.

prior to this, zong fuli had officially taken over the wahaha group. according to qichacha, on august 29, wahaha underwent industrial and commercial changes. zong qinghou resigned as the legal representative and was replaced by zong fuli. zong qinghou's 29.4% stake was also transferred to zong fuli. at the same time, zong fuli also served as the chairman and general manager of the wahaha group, which means that zong fuli has achieved a staged victory and officially took the helm of the wahaha group.

source: visual china

but has zong fuli really secured her position?

liu yu (pseudonym), who has been a wahaha distributor for more than ten years, believes that it is difficult to say at present.the next test for zong fuli is whether she can lead the team to a big victory., and convince the company's veteran employees." at this stage, offline channel transformation is the focus for wahaha.

in fact, zong fuli's efforts in offline channels have yielded initial results so far, directly driving the growth of wahaha's sales.liu yu revealed that sales in his region have increased by 50% this year.at the same time, the number of salesmen in his company increased from 4 to 7.

regarding the results of channel transformation in the first half of this year, "china entrepreneur" sent an interview letter to wahaha, but the other party did not respond.

although there were undercurrents within wahaha at that time, zong fuli did not stop her transformation of offline channels.

in early september, wahaha's official website published a tender notice, which included 100,000 smart freezers. liu yu told china entrepreneur that wahaha originally planned to make freezers by itself, but the quality of the one it produced before was not very good, so it changed to tendering. he said that this move also shows zong fuli's determination.

channels have always been a battleground for beverage companies. there is a saying in the fast-moving consumer goods industry: whoever controls the channels controls the world. this is exactly what wahaha has been working hard to catch up with in recent years.

in the past, wahaha had always relied on the joint sales model founded by zong qinghou, but neglected the construction of terminal channels, was cautious in the introduction of freezers, and had relatively extensive channel management. after taking over, zong fuli began to make great efforts to make up for the lessons, hoping to reshape wahaha's offline channels.

wahaha freezers are in short supply now

on august 30, wahaha’s official website released a “refrigerator maintenance and market launch bidding notice”, involving the maintenance of 61,735 refrigerators of different years and the bidding of 100,000 smart refrigerators, including 80,000 600l single-door upright refrigerators, 10,000 1,000l double-door refrigerators and 10,000 800l single-door refrigerators. the bidding will be stopped on september 6. however, the reporter found that as of now, the bidding information can no longer be found on wahaha’s official website.

li rong (pseudonym), a wahaha distributor in jiangsu, confirmed to china entrepreneur that wahaha is indeed increasing the deployment of freezers. after zong fuli took over, she began to control the terminals and at the same time enhance wahaha's brand image.

the freezer became the first entrance for zong fuli to control the terminal. offline, the freezer means display, and there is even a saying in the industry that "there is no sales without freezer display." usually, the freezers put out by various brands will give priority to displaying their own drinks. the freezer is also the main channel for brands to increase product display and sales, as well as promote their brand image.

specifically, "first increase the number of direct-control terminals, then increase the number of effective terminals, and then turn the effective terminals into image terminals," said li rong.

in recent years, all leading beverage brands have also put a large number of freezers into use. it is understood that coca-cola has the largest number of freezers in china, reaching 1.29 million units; data shows that the number of freezers put into use by nongfu spring terminals has exceeded 650,000 units. other beverage brands have also begun to join the offline freezer battle, such as dongpeng special drink and yineng.

as early as march this year, zong fuli, who took over as the successor, began to focus on offline channels. at that time, taking advantage of consumers' enthusiasm for wahaha, zong fuli issued a "letter to all sales staff" signed by wahaha. the letter mentioned that wahaha must fight a surprise battle for terminal distribution, with the goal of making wahaha products visible and available to everyone. this was also her first major move after taking over.

the additional freezers are also due to the enthusiasm of offline stores for wahaha products. liu yu told reporters, "many supermarkets want our (wahaha) freezers, but the freezers we have booked with the company are already scheduled until next year." according to him, wahaha freezers are still in short supply.

photography: hu nannan

zong fuli once wanted to produce freezers by herself, and a tender notice released on wahaha’s official website also confirmed this. reporters found that on march 14 this year, wahaha had issued a "material tender for precision freezer project", which was for materials for the production of 2,000 600l medium-sized freezers, including sheet metal parts, injection molding parts, refrigeration components, small electrical parts, lamps, hips materials, pcm composite materials, etc.

this is also because the cost of investing in freezers is not small. li rong revealed,the cost of a freezer is about 5,000 to 6,000 yuan. based on this calculation, the cost of 100,000 freezers would be at least 500 million yuan.the official website of wahaha shows that it has over 3 million terminal outlets across the country.

in this regard, li rong said that not all terminals will be equipped with freezers, "after all, there are not so many resources." liu yu also said that they will also evaluate whether a certain terminal is suitable for freezers, "because the demand is quite large now."

the current offline freezer competition is also very fierce. usually, supermarkets have limited space for freezers, and it is also quite troublesome for the owners of terminal supermarkets to replace freezers.

in liu yu's opinion, competition is inevitable when freezers are put into use. but in some cases, terminal supermarkets are willing to replace freezers. he gave an example to reporters, saying that he met a supermarket owner who was willing to replace the freezer of a certain brand of beverage with wahaha because the brand was not selling well.

channel management rolled up

in addition to freezers, zong fuli is also taking courses in channel management.

in liu yu's opinion,the biggest change in wahaha in the past two months is that its channels have become more refined."the operations will also require sales staff to be more meticulous."

he told china entrepreneur,wahaha now evaluates market penetration rate(the coverage of the product in the local market), and also assess the salesperson’s frequency of visiting the supermarket, asking the salesperson to help the supermarket sort out goods, organize, take photos, etc.in the past, the annual sales volume was very stable, so the salesmen were relatively lazy.. "liu yu said.

previously, many supermarket and convenience store owners revealed to reporters that before wahaha became popular online this year, they rarely saw wahaha salesmen visiting their stores. a convenience store owner in zhangzhou, fujian, told reporters that her mother had run a supermarket for more than ten years and had only seen a wahaha salesman once. her store had never had a wahaha salesman visit it before, but in the past two months, a wahaha salesman visited the store once.

she also told the reporter a detail. in april this year, she saw a group of shelves in a wahaha supermarket in hangzhou. the wahaha products were scattered on the front, while the nongfu spring products were neatly arranged on the back. this shocked her. in her opinion, as an old brand, the reason for wahaha's current situation is that it has not invested funds in offline operations.

in fact,the entire fast-moving consumer goods industry is moving towards refined managementzong fuli is also aware of this. liu yu said that the workload of wahaha salesmen is now even greater. salesmen in their team now have to visit up to 50 terminal supermarkets a day, while before the sales volume picked up this year, salesmen only visited 20 to 30 supermarkets a day at most.

correspondingly, the salaries of salesmen have also increased. liu yu said that during the peak season for beverage sales this summer, the salary of wahaha salesmen could reach more than 10,000 yuan.

source: visual china

judging from the mature fmcg channel models of peers, a powerful information system is needed to better control the terminal channels. liu yu told china entrepreneur that the industry is now emphasizing digital management.

liu yu worked as a distributor of nongfu spring for more than ten years, but he stopped doing it in april this year. in his opinion, nongfu spring's channel management is relatively more sophisticated. he told reporters that nongfu spring is so sophisticated that every terminal store in the area under your jurisdiction will be registered, and the salesperson will place an order for purchase on the mobile phone, which will be immediately transmitted to the distributor. at the same time, nongfu spring also replaced the distributor's purchase, sales and inventory management system with nongfu spring's own purchase, sales and inventory management system, so that the distributor's inventory status can be grasped in real time.

according to him, wahaha has always had its own terminal system. in this system, salesmen can enter the terminal stores into the app and see how many terminals there are in a region. but he said that wahaha does not have its own inventory management system, and currently uses the dealers' own inventory management system. but in his opinion, whether or not there is its own inventory management system has little impact on wahaha at this stage.

in the view of a former wahaha salesperson, zong fuli only needs to copy the homework of her peers in terms of channels. "she can live well by learning from any of nongfu spring, master kong, coca-cola, etc."

next, it depends on zong fuli's courage to change.