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proya, the “top domestic beauty brand” that is sprinting towards tens of billions of revenue, suddenly announced a handover message.

recently, proya announced that hou yameng, the former deputy general manager of proya, has been appointed as the company’s general manager. fang yuyou, the former co-founder, director and general manager of proya, will no longer serve as director and general manager of the company due to personal reasons. in the future, he will still be the company's co-founder and board advisor, assisting the company's strategic planning and operational management support.

relying on the concept of "morning c and night a" that has emerged in the field of skin care in recent years, proya's revenue has been rising steadily.

the founding team of proya is a combination of brother-in-law and brother-in-law.

hou juncheng, the founder of cosmetics wholesale in yiwu, and his brother-in-law fang yuyou, relied on being close to another internationally renowned brand "l'oréal" and the two rounds of opportunities brought by cs stores + e-commerce, step by step in the field of domestic beauty products emerge.

picture of hou juncheng and fang yuyou/proya co., ltd. official website

since surpassing shanghai jahwa in 2022, proya has always firmly occupied the position of "the number one domestic beauty brand". hou yameng, who takes over this time, is the son of founder hou juncheng.

although there are many examples of "second-generation succession" in recent years, fang yuyou, who was born in 1969, is only 55 years old this year. he "retired to the second line" early and gave way to his nephew, leaving many unanswered questions.

store + e-commerce, build a big name

from the countryside to the city, from what people call a "copycat" to taking the top spot in domestic beauty products, proya's development process has been bumpy and lucky.

wenzhou people are naturally good at doing business, and hou juncheng is no exception.

in the 1990s, it was a good time to do business overseas. hou juncheng left his hometown of wenzhou and went to yiwu, which has more development potential, to start a cosmetics wholesale business. soon after, hou juncheng's brother-in-law fang yuyou followed in his footsteps and came to yiwu together.

however, at that time, cosmetics brands were mixed, and many foreign-funded companies also entered the chinese market, doubling the competitive pressure.

as wholesalers, hou juncheng and fang yuyou saw that the living space of domestic beauty products was being squeezed, and brands disappeared and were acquired one after another, and they had to think of new ways out. together, the two of them decided to create their own brand.

in 2003, they changed the brand name to "proya", which not only sounded foreign, but also caught on to the popularity of "l'oreal", so it was also questioned as a copycat product.

picture/proya co., ltd. official website

hou juncheng and fang yuyou also understood that l'oreal was a big international brand and could not compete from the front, so they planned to do the opposite and adopt the strategy of "surrounding the cities from the countryside" and rely on channels to build up the brand first.

after gaining a foothold, proya has taken off continuously since 2008, relying on the two waves of offline stores and e-commerce.

at that time, cs stores (cosmetic shop, referring to channels consisting of cosmetics specialty stores or chain stores) were all over the streets. taking guerlain as an example, there were more than 300 chain stores.

proya took the opportunity to also develop offline stores. hou juncheng later said in an interview that at that time, there was a severe gap between department stores and supermarkets, and the rise of cs stores required local beauty brands. this was a hard demand in the market.

also in 2008, proya's revenue exceeded 100 million, making it into the top camp. in the following five years, proya continued to develop rapidly.

according to media reports, proya achieved a rapid annual growth of 69% in the five years from 2008 to 2013, with sales reaching 3 billion yuan in 2013.

in 2017, during the critical period when proya was about to go public, hou juncheng and fang yuyou keenly sensed the future potential of online e-commerce business, and they made a risky decision to shift the development center from offline to offline. superior.

on the one hand, the proya brand has begun to deploy on multiple platforms such as douyin and taobao to establish its brand image; on the other hand, they have also found endorsements from many big anchors such as li jiaqi, mr. dong, and jia nailiang, pushing product sales to another level. peak.

photo of li jiaqi bringing goods for proya/screenshot of "all girls' offer 2" program

in seven years, the proportion of proya's online sales has increased from 30% to 90%. this is also regarded by the outside world as one of the main factors that enable proya to break out of the competition among domestic brands.

in the latest quarterly financial report data, proya demonstrated its impressive results.

according to proya's 2024 semi-annual report, it achieved operating income of 5.001 billion yuan, a year-on-year increase of 37.90%, and net profit attributable to the parent company of 702 million yuan, a year-on-year increase of 40.48%.

hou juncheng said, "channel dividends are coming every year. proya is a brand that emerged from the daily chemical channel in the sinking market. constantly changing channel strategies is the basic skill for proya to survive today and not be beaten to death by european and american brands."

new officials take office, old officials retreat

as consumers are pursuing domestic cosmetics, proya's external development prospects are very promising.

the "2023 mckinsey china consumption report" pointed out that chinese consumers' preference for local brands has indeed accelerated in recent years. 49% of chinese consumers believe that local brands have "better quality" than foreign brands.

at the same time, in addition to the main brand proya, the company's incubated brands such as caitang, off&relax, yuefuti, correctors, insbaha, uzilai, hana and other brands are also covering the market in all aspects, covering skin care, makeup, washing and care, etc. field.

proya's brands

among them, the financial report for the first half of 2024 shows that proya’s brand caitang has revenue of 582 million yuan, a year-on-year increase of 40.57%, and has the potential to become proya’s second growth curve.

but in recent years, proya has seen frequent personnel changes.

according to tianyancha, hou juncheng’s shareholding ratio was 48.43% and fang yuyou’s shareholding ratio was 20.98% as early as 2006, when he first participated in the shares. as of now, there have been some changes in shareholdings. hou juncheng holds 34.46% of the shares and is the largest shareholder; fang yuyou holds 15.03% of the shares and is the third largest shareholder.

this means that proya's surname is "hou", which is an indisputable fact.

at the 2024 china cosmetics conference held not long ago, hou juncheng attended as the chairman of proya. before that, it was usually fang yuyou who made an appearance on behalf of proya.

before fang yuyou left, proya's former chief marketing officer ye wei and proya's former chief scientific officer wei xiaolan had resigned one after another. combined with fang yuyou's departure this time, it can be called a "big change" in management.

some investors lamented, "the blood bond of wenzhou people has indeed defeated the brother-in-law relationship."

it is worth mentioning that fang yuyou may have expected that one day he would abdicate and made plans early.

according to oriental fortune network, from december 2020 to february 2023, fang yuyou frequently reduced his holdings of proya shares, a total of 62 times, cashing out approximately 3.574 billion yuan.

fang yuyou used part of this money for his personal business layout outside of proya. according to tianyancha, in 2018, fang yuyou established a wholly-owned holding company, hangzhou fang xiake investment co., ltd.

since 2021 to now, the companies fang xiake has invested in include hangzhou tieding liuliu food co., ltd., hangzhou tieding liuliu catering management group co., ltd., qingdao zhongke lithium battery venture capital fund partnership, beijing xiangyuan technology center, etc., involving leasing and business services, finance, scientific research and technical services and other industries.

"iron determined liuliu" is one of fang yuyou's key projects. it is reported that "tieding liuliu" is a pastoral complex project that fang yuyou plans to invest 2.2 billion yuan to build with dendrobium officinale as the core and integrating theme entertainment, vacation vacation, and pastoral leisure.

fang yuyou once said, “‘iron determination’ refers to my determination to do projects for my hometown. ‘liu liu’ is not only a description of the shape of dendrobium, but also the nickname of the slide, the park’s main attraction.”

perhaps, this can be regarded as a way out for fang yuyou.

"one offense and one defense" in the future

before fang yuyou's power was transferred down, the outside world didn't know much about hou yameng, hou juncheng's son.

public information shows that hou yameng entered proya in 2014 and first worked in the e-commerce department. he then served as micro-business project manager, chief news officer, and head of proya tencent e-commerce.

"born" in the era of e-commerce, hou yameng is not so much rewarded for his efforts as he caught up with the good times and took the express train.

the 36-year-old hou yameng was pushed to a high position before he could find a suitable opportunity to prove his ability. he succeeded his 55-year-old uncle. the secondary market also had a wait-and-see attitude towards proya's coaching change.

hou yamengtu, general manager of proya company/official wechat account of proya co., ltd.

it is reported that on september 12, the day proya announced that hou yameng was appointed as the company’s general manager, the company’s stock price fell 3.39% to 88.45 yuan/share.

after taking office, the market situation hou yameng will face will also be different from that of hou juncheng and fang yuyou. he needs to achieve "one offense and one defense" with proya.

"attack" means standing on the shoulders of giants and taking a step further. nowadays, although proya can be regarded as the domestic beauty leader, and its performance this year is expected to reach tens of billions, it is still far away from the three peaks of the international big names l'oreal, lancôme and estee lauder.

taking l'oreal as an example, its sales in the first half of 2024 were 22.12 billion euros, which was more than 30 times proya's revenue.

to this end, the financial report for the first half of 2024 also mentioned that proya will explore overseas development opportunities, seize opportunities for chinese brands to go overseas, and drive corporate development with a larger market scale and faster response speed.

however, at present, proya does not seem to have a clear plan on how to enter overseas markets.

in addition to taking an offensive stance to expand market share, proya must also "defend" its own three-acre territory.

"guardian" here refers to sticking to the product position, improving product quality, and completing evolutionary upgrades. you know, "emphasis on marketing and neglect of r&d" has always been a common problem for many domestic beauty brands, and proya is no exception.

in comparison, in the first half of 2024, l'oreal's r&d and innovation expenses were 667 million euros, accounting for 3.0% of sales; advertising and promotion expenses were 7.1091 billion euros, accounting for 32.1% of sales. during the same period, proya's r&d expenses were 95 million yuan, accounting for 1.89% of operating income; sales expenses were 2.34 billion yuan, accounting for 46.8% of operating income.

when the traffic dividend is exhausted, whether you can stay in the market ultimately depends on the product itself.

on xiaohongshu, in addition to the overwhelming advertisements from kols, there are also many users who complained that proya is "very windy, but it is useless when used". these are the consequences of proya's "emphasis on marketing and light on r&d". if left unchecked, it may become a hidden danger in the future.

in november 2023, at the "2023 business and charity forum" hosted by sing tao shan meng (afg) in singapore, hou yameng expressed his views on the domestic beauty market. he said, "those who have done beauty entrepreneurship should we also know that this track is particularly demanding and innovative, so we can only deal with this challenge in an innovative way, maintain an entrepreneurial mentality, and then look at this matter with a beautiful eye.”

fortunately, hou yameng took over proya, which is still on the rise, leaving him more time to create his own "selling" methodology.