The FBIF 2023 (Food and Beverage Innovation Forum), hosted by Simba Events, officially launched on June 14, 2023, at the Shenzhen. FBIF2023, with the theme of "Re-Image", explores the innovation and growth model of the food industry.

FBIF2023 gathers 300 global speakers, 900+ exhibitors, 7000+ industry guests, and a total of 30000+ professional visitors attend the exhibition. 100+ media from domestic and abroad gathered at the FBIF2023 event to spread the global food and beverage industry trends and opinions of industry pioneers to the world from a variety of perspectives.

On June 14th, at the plenary meeting of the FBIF2023 Forum, a Managing Partner of Ventech China, Mr.Curt Ferguson, together with Mr. Che, Director of Master Kong Beverages, and Mr. Wang, Founding Partner of Hosen Capital, presented "Future Consumption: Recovery , Transformation, and Confidence” held a roundtable dialogue, shared their views on the above issues in combination with their respective professional fields, and conducted an in-depth discussion on the future consumption trends of the food and beverage industry.

[The following is organized according to the on-site conversation, the content has been abridged]

01

What changes and inspirations have there been in the consumer market in the past three years?

Ms. Lu: The topics we are discussing today are recovery, transformation and confidence. So what changes do you think the entire consumer market has experienced in the past three years, and what enlightenment do these changes have for the food industry and enterprises?

Curt Ferguson: Combining my observations of the consumer industry in China for the last decade and my experience in the past three years, it can be said that we have seen two changes of consumption.

Last three year formed a more powerful system for home delivery, also empowered enterprises' supply chain ability. This is a unique business model in China that cannot be easily achieved by anyone in the Western world. Pizza, for example, must be kept warm in order for people to be willing to consume it.

The other is a gradually rational consumption behavior, consumers spend money rationally. In many cases, stimulating consumption is not sustainable, and we must establish a sustainable model. For example, we not only need to launch consumer rockets, but also build consumer rocket launch sites. Only in this way to continue to launch rockets.

At FBIF, we are delighted not only to see many new brands, but also to see many brands "survive", and these brands have achieved sustainable and long-term growth. 

Rapid growth is undoubtedly a booster for the market, but for some investors, it may also be a trap. Because many models do not necessarily apply to any scene and maintain sustainability. 

There are a large number of products in China that can be obtained at a lower cost, but whether they can obtain higher value-added and make consumers more willing to pay is another question, and there may not necessarily be the same answer.

Ms. Lu: Curt mentioned an important point. China's growth may be the best opportunity, but it is also the biggest trap for consumer brands. The real difficult challenge is how to create a sustainable business model.

02

In times of uncertainty, why is a resilient supply chain more necessary?

Ms. Lu: The importance of the supply chain has become more prominent in the past three years, so I would like to discuss this point. In the past few years, everything we talked about was crazy about making good products and doing marketing, but we talked less about the supply chain. For people in the food and beverage industry, the supply chain is the real basic skill, and it is a very important element to test how far each brand in the industry can go.

So I would like to ask you to share, how do you view the topic of resilient supply chains in an era of uncertainty, and what suggestions do you have for the entire industry?

Mr. Che: When it comes to the supply chain, we are currently facing great pressure and challenges. As far as the entire beverage industry is concerned, the gross profit of Master Kong’s beverages is not high, and the gross profit for mass consumers is less than 40%. How to better meet the supply of enterprises and achieve the company's annual profit target, the supply chain has a great responsibility.

During the three years of the epidemic, the supply chain has encountered big problems. One is the pressure on costs brought about by rising raw materials. The most important thing in preparation is to reduce purchase costs. We hope that the enterprise can obtain the optimal and lowest procurement cost. In order to achieve this goal, we have introduced a set of scientific bulk raw material procurement tools, hoping to reduce the entire procurement cost.

The second is the requirement of sustainable development, such as carbon reduction. In terms of the supply chain, we will focus on the green and environmental protection of some factories in terms of bioenergy or geothermal energy. 

The third is the digital and intelligent factory. Now our Zhejiang Hangzhou factory has begun to introduce scientific data collection and decision-making, and then quickly respond to the needs of the marketing side.

Mr. Curt Ferguson: I think there is a huge gold mine in the supply chain, and now we have a unique thing -AI. Whoever can make good use of AI in the supply chain can bring the supply chain out of the dark age and into the light. I believe that after the addition of artificial intelligence, the reshaping of the supply chain will become completely different.

03

Under the background of channel transformation, how to achieve growth and profit?

Ms. Lu: What is the biggest pain for the channel? How to achieve growth and win? This question is first handed over to Curt. How to solve the contradiction between growth and gain?

Mr. Curt Ferguson: First of all, I think we can see that many changes in China are actually a kind of "hot money". I think what kind of business model works is a question we have to think about.

Many luxury brands in Europe have a very sticky relationship with consumers. They have a good offline consumer base, and consumers are willing to pay a high premium. For example, the profitability of the LV store in Chengdu is higher than that of the store on the Champs Elysees in Paris, France. Therefore, creating new brands offline and new consumption scenarios are emerging, which is a very good combination of consumption and channels.

We have seen many disruptions, all of which are new consumption trends, where consumers are willing to shop. For a brand, what are new channels and how can they seize new channels to deliver better products and services to consumers. If you don't seize online channels, your competitors will beat you. Overall, what kind of channel is better for brands, and how to seize it to survive.

04

How do you think of the ‘downward trend’ of consumption enthusiasm?

Ms. Lu: The two answers tell us to solve the channel problem and think beyond the channel. What's more important is how to focus on consumers and truly find your innovative layout and operating model. This may be the inspiration for everyone. Only by upgrading your thinking can you reduce your dimension. Finally, three guests are invited to give a message to the food and beverage industry.

Mr. Curt Ferguson: No matter what industry or product we are in, consumers will give you some new inspiration, sometimes beyond your imagination. We will see huge changes in the future, what kind of opportunities will there be under this? We want to make sure we seize these opportunities and win the market.

Mr. Che: The beverage industry has experienced many difficulties and crises in the past three years, and of course saw many opportunities. I think the future trend of the beverage industry will be better and better. In the future, it is still necessary to maintain an optimistic state, to operate enterprises to meet the needs of consumers, and to achieve win-win cooperation with customers at the same time.

Mr. Wang: Today is a windy and rainy day. Although the forum has been postponed for a little time, it is still full of people. I think the food and beverage industry is good or not, and the activities held by FBIF every year are a barometer. I hope our activities will be better and better.

Ventech China is deeply involved in a series of FBIF and the food and beverage industry, and constantly looking for inspiration.