Zhang Jindong, the chairman and founder of Suning Holdings Group Ltd, said a new collaboration agreement with liquor brand Wuliangye Group Co Ltd will help ensure fewer counterfeit goods enter the marketplace, as well as cut transport costs for both firms. Speaking at the official signing ceremony for the deal, Zhang said the tie-up will also help bolster the further development of Wuliangye’s e-commerce distribution channels. Under the agreement, China’s largest electronic home appliance-turned-Internet retailer will be able to collect products directly from Wuliangye’s factories and warehouses, and transport them to its own distribution centers, thus reducing the need for any middlemen, said Zhang…Full Article: China Daily Mar 2016

Key Point

  • As a result of the agreement, Wuliangye will be more widely distributed within Suning’s ~2,000 brick-and-mortar stores. Additionally, Wuliangye products will be sold on http://www.suning.com/

ChinaAg Comments

  • In December 2015, a Chinese national from Guangxi Region was found guilty of manufacturing and selling counterfeit bottles of Maotai, Wuliangye and Luzhou Laojiao. The counterfeiter re-filled high-end liquor bottle brands with cheaper alcohol and primarily distributed them in Beihai City, Guangxi region.
  • In November 2015, Wuliangye announced plans to raise CNY 2.3 billion (~US$364 million) to invest in marketing centers and e-commerce platforms.
  • From 2013 to 2014, Wuliangye’s net profit decreased 26.8% to CNY 5.83 billion (~US$947 million).
  • In February 2013, Wuliangye was fined CNY 202 million (US$32.3 million) by China’s NDRC for price fixing.
  • With roots going back to the early 1950s, Wuliangye was established in 1998 in Yibin, Sichuan province. A rival of Kweichow Moutai, Wuliangye is an alcoholic beverage producer that specializes in the production of baijiu liquor. The company has a numerous baijiu products that vary in strength.

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