Jinshiyuan discusses channel inventory: It’s unrealistic to have no pressure at all, but without additional incentive policies or forced stockpiling, the company's advance payments have achieved relatively rapid growth.

Recently, Jinshiyuan released a record of investor visit and reception. It mentioned that the company continues to promote online channel development, with current online growth surpassing offline. The development of online business heavily depends on the offline market foundation and requires ensuring coordination between online and offline actual transaction prices to prevent channel conflicts.

Most online customers are consumers actively seeking the brand, mainly concerned with convenient purchasing and authentic products. Due to the lack of regular offline product taste experience as an anchor, it is more difficult to directly launch new products online, and consumers find it hard to develop blind purchase intentions.

In terms of brand building, the announcement disclosed that the company is systematically promoting brand value upgrades, aiming to enhance brand reputation and perceived value. Regarding marketing resource allocation, the company adheres to the principle of efficiency first, dynamically optimizing investment structure to ensure resources are tilted toward projects that can bring high-quality growth and long-term brand value. Overall brand promotion investment remains stable, with organizational restructuring further optimized for efficient collaboration, continuously consolidating and enhancing market recognition of the brand.

The company’s strategy outside the province has shifted from point-based expansion to deepening the influence of existing markets, and is committed to increasing repurchase rates to form a stable market. The company refers to weak markets in Shandong, Anhui, Zhejiang, Shanghai, and other surrounding areas based on Jiangsu’s management, and invests more heavily to continue nurturing these markets. The overall growth outside the province is faster than within.

Regarding the competitive strategy within the province, the announcement mentioned that, under the current competitive landscape, the mainstream companies’ competitive methods have become largely similar, and any aggressive policies are easily followed by competitors, so the company prefers to stabilize its position through strategic focus and differentiated competition. The company avoids falling into the “policy contest” trap and instead focuses on cultivating brand cultural differences. The core logic of management is to attract consumers based on the company’s own brand characteristics, opposing the mindset of attacking competitors’ weaknesses to engage in stock competition.

The company always prioritizes the healthy development of the channel ecosystem. Through strict dynamic management systems and assessment mechanisms, the overall inventory levels of distributors are controllable and in a healthy range. The market price system remains basically stable, with core product price stability, reflecting the steady operational capacity of distributor partners and the effectiveness of the company’s refined channel management.

The announcement also mentioned that compared to previous years, the overall channel inventory is in a relatively healthy and stable state. We have always paid attention to the rhythm, not advocating for heavy pressure on channels. But given the market environment, it’s unrealistic not to exert some pressure. Currently, distributors are operating normally, and inventory pressure is manageable. On the other hand, during this post-holiday period, distributors’ enthusiasm for payments remains good, and the overall prepayment situation is better than we expected.

From an intuitive perspective, the operational pressure has improved month-on-month. Without providing additional stimulus policies to distributors or forcing inventory pressure, prepayments have grown rapidly. This indicates that the channel’s sales activity and repayment willingness are healthy, giving us more confidence in the subsequent market rhythm.

Regarding the divergence between terminal consumption data and liquor companies’ shipment performance, the announcement stated that this divergence is especially prominent during industry downturns and essentially reflects the logic of social inventory destocking.

In periods of high industry prosperity and strong price increase expectations, channels and consumers will actively increase inventory; whereas, when price expectations decline, stored liquor instead signifies asset depreciation, and social inventory will flood into consumption channels, resulting in manufacturer performance declining more than terminal consumption. Manufacturer inventory increases are usually short-term and limited by physical space and capital, making unlimited expansion difficult.

Within the province, expenditure investment remains basically stable; outside the province, the overall expense rate has decreased, but targeted increases in investment are made through “project-based” approaches for key markets. The goal is to strengthen project management to prevent expenses from converting into low-price channel promotions, thereby maintaining product value perception and price system stability.

(Company announcement)