Certainly 2020 is an unprecedented year for humanity. The Covid-19 pandemic and the economic recession have dramatically reshaped our lifestyle and consumers habits.
Plant-based products are highoy sought after and have gained and have gained capital interests, nutritional supplements and dairy products are in great demand during the pandemic. While people were confined at home, food services and restaurants collapsed but online businesses skyrocketed; apart from the big giants, some local brands benefited from the boom and took the opportunity to reshape their businesses and to portray a healthy and nutritional image.
Plant-based products are in vogue
Over the years, plant-based products were mainly developed for the American and European markets, but they are becoming more popular in China, especially plant-based meat and plant-based dairy. The same applies for brands like Impossible Foods, Beyond Meat and Oatly who have developed an end-to-end ecosystem to compete in the market. On the other hand, plant protein raw material producers, such as Dupont, Wilmar, Cargill, ADM are building capabilities in R&D, Business Development and Regulatory around Asia. Meanwhile, McD, Yum! Starbucks have been pioneering “plant-protein” in their menus.
A number of traditional Chinese vegan-food brands and producers such as Qishan, Shuangta, accompanied by Starfield, are attracting more capital investments. However, their efforts were curbed by how to enhance the texturant and flavour that gives the taste, external regulatory environment and evolving Chinese consumer habits, are among the challenges.
Consumer behaviour reshaped
Whilst Covid-19 is changing consumers’ behaviour - what they eat, how to eat and where to eat - health and nutrition are becoming an important part of diets, that include dairy and supplements. As such, dairy giants like Yili, Mengniu and Fonterra have been expanding investment in fresh milk delivery. Meanwhile, H&H, By-health, Amway and Herbalife took the opportunity to increase their market share. On the other hand, restaurants and food services took a deep dive as most businesses lost 55% to 80% revenues in H1 this year. Therefore, businesses are tripling their efforts to catch up in the second half and readjusted their growth targets for 2020.
Younger generations, who are more used to buying food online, are driving up the consumption for instant foods such as instant noodles, dumplings and other frozen foods. General Mills, Master Kang, and emerging brand such as Lamianshuo have recorded remarkable sales online.
Revival of domestic brands
The revival of domestic brands - tier-1 brands, tier-2 giants and emerging local brands -are increasing social engagement strategy with Millennials as well as pouring investment into R&D. Brands like Feihe and Bestore are increasing efforts to attract overseas R&D talent to spearhead policy making. Whilst foreign multinationals are struggling to gain more resources and support from Headquarters to catchup in the Chinese market.
If you have any hiring needs or need guidance in your career move in Mainland China, please get in touch with Roy Wu, Manager Technology of Animal & Food Nutrition at Fyte, on +86 21 3103 2228 or email email@example.com. For Hong Kong, please contact Morgan Philips Executive Search Consulting Manager Wing Lau at firstname.lastname@example.org.