Wahaha Group Company
The visit started off by showing us the bottling plant.
Initial Impression: The plant was very clean and all the workers were in a uniform. Most of the workers were working with bare hands (no gloves or any other protective equipment). The line seemed to be efficient and running at capacity.
Next Impression: Some of the machines were dropping the bottles. At certain steps of the conveyor belt, there was a liquid that was sprayed on the belt. I was of the opinion that this was to prevent the bottles from falling over since they were plastic and light weight as opposed to the glass beer bottles at the Nanjing Beer Factory.
We were then taken into the “Tourist Reception Conference Room”. where we were shown a video explaining the history, product lines and the future strategy of Wahaha Company. A question and answer session followed the video.
My Questions and Observations: When in the bottling plant, I started to think how the company would be able to survive the inflow of the foreign players in the market. It seemed that the Wahaha brand had a great following amongst the locals. One of their key markets and strategies was to start building up from rural markets. The question that comes up is did Wahaha face distribution problems sending their products to the inner parts of China? Based on the response from the PR coordinator, Wahaha has set up factories in rural areas so that they are closer to the customers and distribution is hence not a problem. However attracting customers in rural China can be more complicated than increasing sales in urban areas. Wahaha has an advantage over a foreign player due to its local roots.
After the acquisition of Wahaha by Danone, will we see the name Danone on the products or will they continue to leverage the Wahaha brand name. This is reverse from Lenovo acquiring IBM ThinkPad and marketing the product under Lenovo. So the question that Danone is faced with is to decide if they want to continue using the Wahaha brand name or leverage on the global “Danone” brand name.
On the other hand, can Wahaha expand its brand name globally? An Indian bottled water manufacturer “Bisleri” created a market of bottled water in India when there was no such concept as “bottled water”. The name Bisleri became synonymous to clean bottled drinking water. Is Wahaha a sensation in the Chinese markets? Do people in the rural areas call all bottled water by the name of Wahaha? Recently, Bisleri has indicated its intentions to expand its reach and brand name into Europe and Asia. It will be very interesting to see a similar move by Wahaha
Longjing Tea Village
The visit to Longjing Tea village was very unique. I admit that I have visited several tea estates in India; Longjing was a very unique experience. The tea village was beautiful, peaceful, and vast. A striking feature of the village was the plush houses that belonged to the local farmers. All the houses had relatively brand new cars parked outside the homes. This shows that the growth in the economy is not only restricted to the big cities, but the smaller towns and villages are also experiencing a boom and making the most of this growing economy. While we were exploring around the village, we met a local lady who took us to her home and served us hot tea. They made us feel very welcome and were very hospitable and humble. We had communication problems since neither Ben nor I spoke Chinese. It was a true adventure of going to the house and looking at their living conditions.
(Above are pictures in the house of the tea farmer and a walk through one of the bylanes of their small village – This visit was definitely one of the most memorable events on the entire China trip.)
Travel to Shanghai
After the Longjing Tea Village visit, we started our Bus journey to Shanghai. I was really impressed by the long and developed highway system. If I compare the Chinese highway infrastructure to India, China is leaps and bounds ahead of India. One of the things that are going to impede India’s growth in the long run is the development of highway system to connect cities and allow for a smoother flow of logistics, supplies and people.
Another thing to note along the stretch from Hangzhou to Shanghai was the numerous billboards dotting the highway on both sides. There was extensive advertising for products, both, local and foreign. Cars, computers, clothes, medical equipment, banks, etc were fighting for space and user attention. These billboards were set up in the farms allowing the farmers for additional revenues. As we were getting closer to Shanghia, we had to maneuver through severe traffic. But this gave us an opportunity to sulk in the midst of hundreds of skyscrapers around us. Shanghai truly is an international city and I am not afraid to admit that it is far more developed than many Western cities that I have visited. The picture below explains it far beyond words.
