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Diaper industry War: 1200 brands compete for 30 billion Chinese market

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Diaper industry War: 1200 brands compete for 30 billion Chinese market

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The "two child" policy has been gradually liberalized to accelerate the growth of the mother infant market. Relevant statistics show that in 2015, China's maternal and infant industry market is expected to exceed 2 trillion yuan, and diapers are one of the most popular branches of the maternal and infant industry, except milk powder. As ice cream and toothpaste, diapers have become a Fast-consuming product. Although the profit is limited, it has not affected the pursuit of the market of diapers by all kinds of businesses at home and abroad.

The market size of diapers in 2014 was about 29 billion yuan, up 16% from the 25 billion yuan market size in 2013, according to the Institute of Parents and Parents. At present, there are about 1200 brands in China's diaper industry, of which, from the beginning of 2013 to the present, there are about 200 new domestic and foreign brands into the market. By 2017, the market of Chinese diapers will expand to 120 billion yuan, and 200 foreign brands will enter the Chinese market, according to MPE.

It is reported that there are many manufacturers in China's diaper market, and the top 10 diaper manufacturers account for about 80% of the total sales. Procter & Gamble's Pampers, Kimberly's Curiosity, Eugenia's Mommy Baby and Flower King's Miao and Shu are among the top brands, while domestic diapers have emerged in recent years, but lower import tariffs have put pressure on local companies.

Diaper Wars

Japan's King of Flowers diapers are one of the hottest products among Chinese mothers in Haitao. In an interview with China's First Financial Daily, Chairman of King of Flowers Akida Daolong told reporters that official sales of diapers in China grew rapidly, with sales in 2013 (both imported and domestic) doubling from 2012 and in 2014 from 2013. It was two times that of the year, and the sales of domestic made and comfortable diapers in 2014 were three times that of 2013.

Huawang's new paper diapers factory in Hefei, Anhui, was put into operation in January 2013 to meet the growing market demand in China. In fact, foreign giants of diapers in recent years are increasing production and construction in China, digging the gold market in China. In 2013, Procter & Gamble launched a new plant in Luogang, Guangzhou, to produce a wide range of products, including Pampers; that year, Kimberly opened a new plant in Nanjing to produce curious diapers and pants; in the first half of 2013, Kimberly's sales in China rose 42%; Eunica opened its fifth in Yangzhou. In 2014, Japan's King's Paper Company built a new diaper factory in Nantong, Jiangsu Province, and Japan's Bayi parent company recently started production of baby diapers at a new factory in Changzhou, China.

As the market for diapers continues to grow, more and more local enterprises are joining the diapers war. According to the statistics of the Institute of Parents and Parents, as of 2014, there are as many as 1000 brands of diapers in China, and some paper and dairy enterprises have set foot in this field.

At the end of 2010, after investing HK$123 million in 41% of the shares to establish Viagra Holdings, Viagra International added HK$295 million (RMB 240 million) in July 2015 to acquire 59% of Viagra Holdings to make full use of its baby diapers and other products; another paper company, Shun Jierou, also took the form of a sole agent to intervene in paper urine. Trousers industry and baby diaper market.

Heng an international, the first category in diapers, occupies about 13% of the group's sales. From 2011 to 2014, its paper diapers income was HK $2.72 billion, HK $2.69 billion, HK $2.94 billion and HK $3.094 billion, up 11.3%, 1.4%, 9.4% and 5.3% respectively.

However, on June 1, 2015, the state lowered the tariff rates on imports of 14 consumer goods, including diapers. Among them, the tariff rate of diapers was the largest, falling from 7.5% to 2%. Most local companies are beginning to worry about whether imported brands will have a positive impact on domestic brands after tariff cuts. Although most of the imported products are concentrated in the first and second-tier cities, and mainly focus on high-end markets, the impact on low-level regions is small, but domestic diaper manufacturers still feel pressure.

Rise of high-end market

In order to protect the baby's little fart from diaper rash, mothers after the 80s and 90s in China are willing to pay higher prices for diapers. Parents'increasing awareness of infant safety and consumer upgrades in the Chinese market have led to a growing demand for high-end diapers that cost about 1.7 times the price of local products in China. It is understood that the annual growth rate of high-priced paper diapers reached 30% - 40%, the share from less than 10% in 2010 to about 15% in 2013.

Especially after 2012, the wonderful and comfortable sales of Kao from Japan became the fuse for detonating the market. Following King of Flowers, Kimberly began selling high-priced diapers made overseas in China, boosting its share. Eugenia has launched the Mammy Baby's high-end diaper line in China, up 70% from the original line.

Heng An Group's 2014 annual report also shows that the market demand for high-grade diapers is rising. As a result of strengthening promotion and brand promotion, and actively expanding and entering the emerging mother and baby stores and online sales channels, Heng'an mid-grade and high-grade diapers sales rose by about 11.9% in 2014, but due to the fierce competition in the market of low-grade diapers, its sales revenue fell by about 15.4% annually. As a result, the overall income of diaper products rose only by about 5.3% to HK$3,094 million, accounting for about 13.0% of the group's total income. To this end, the company said it will continue to actively expand the mid-range and