Business / Industries

Old brands hungry for success

By Zhu Wenqian (China Daily) Updated: 2015-06-10 08:33

With a growing reputation overseas, Sanyuan has expanded its global reach. "Our cheese products have been used as raw materials and made into other products," Lyu Shuqin, deputy manager at Beijing Sanyuan Foods Co, said. "They have been exported to Japan.

"At the moment, we mainly focus on the domestic market. But in the near future, we are looking to strengthen our export business."

Since the company was established, Sanyuan has gone through radical changes. Today, it has a highly advanced supply chain in the dairy sector. This involves breeding the herd, raising the cattle, transporting milk and dairy products as well as an after-sales services.

In 2014, the company started work on an industrial park in Hebei province in northern China to expand production capacity. The park will be up and running next year and will process 1,000 tons of milk a day, which is approximately 2 million bottles.

Of the 2,000 traditional brands in China, about 27 percent are food and beverage businesses, according to a research report from Beijing Technology and Business University.

Many, such as the Beibingyang Co, the Beijing Wang Zhihe Food Group Co Ltd and the Beijing Dragon Seal Wine Co Ltd, have been transformed in recent years.

With increased investment, these companies are fighting back against foreign competitors by playing their trump card-brand loyalty. Many customers have long memories and they tend to stick with the products they grew up with.

"In Shanghai, more than 70 percent of local residents remain loyal to the labels of their childhood," researcher Jiang said.

But there are still pitfalls ahead as more domestic and overseas brands move into a crowded marketplace.

"Broadly speaking, whether we admit it or not, most old brands are opting for poor advertising choices," Jiang said. "Time-honored brands need to maintain their luster by keeping pace with the changing times."

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