Maxwell was pulled out to restructure the instant coffee market.

Mondelez International, which was spun off from Kraft Foods two and a half years ago, has reintegrated its business, and this time it is the coffee business-Maxwell. Nandu reporter saw in a "list of cases of unconditional approval of operator concentration in the fourth quarter of 2014" published on the official website of the Ministry of Commerce in the middle of this month. The Ministry of Commerce has approved the establishment of a joint venture between Mondelez International and Aikang Holdings Private Co., Ltd., which will take out the coffee business. Under such a split and integration, Mondelez sends a signal to revive the coffee business, but whether it can reverse the adverse situation in the Chinese market remains to be seen.

All coffee assets in China will be merged into the new company

On November 16 last year, the details of Mondelez's integration were revealed in a public notice from the Anti-monopoly Bureau of the Ministry of Commerce. Nandu reporter saw from this material that C hargerOpCoB.V, a wholly-owned subsidiary indirectly held by Aikang Holdings Private Co., Ltd. Will receive D.E. MasterBlenders 1753B.V. Operate subsidiaries, Diyi virtually all important assets and Mondelez International (Mondelez) coffee business.

A reporter from Nandu read the information on Mondelez's international website and learned that it mentioned in a news document on May 7 last year that the deal did not include Mondelez's coffee business in France, but Aikang had made an offer to buy Mondelez's French coffee business.

The data also revealed that the new joint venture will be established in mid-2015. The merger and acquisition offer will result in a new company, JacobsDouweEgberts, with annual revenues of more than $7 billion, headquartered in the Netherlands. Mondelez will receive about $5 billion and a 49 per cent stake in the new company. Aikang will own 51 per cent of the new company and have a majority on the board.

In fiscal year 2013, Mondelez International Coffee generated revenue of about $3.9 billion, compared with $3.4 billion for Aikon.

The Nandu reporter learned from reliable sources that all coffee-related business assets in Mondelez China will be merged into the new company, including human resources and the coffee factory in Guangzhou Development Zone.

Do not pay enough attention to coffee market

For China's instant coffee market, it is not clear how the joint efforts of Mondelez and Aikang will stir up the Chinese market. But to be sure, both of them do not have a high market share in China. According to details released by the Ministry of Commerce, Mondelez has a market share of less than 12% in China's instant coffee production and sales market, while Aikang's share is even less than 0.1%.

According to a 2014 report by Guangfa Securities, "Nestl é: epitaxial expansion becomes the leader of the food industry", Nestl é's market share in coffee reached 73.5% in 2013, ranking second in Mondelez.

Although the two entered the Chinese coffee market at about the same time, there is a wide gap between the first and the second.

Mondelez pays more attention to the development of major categories such as biscuits, for which coffee is only a very small category. On the other hand, Nestl é is willing to spend time and cost to cultivate coffee products slowly. " Zhu Danpeng, a researcher at the China Food Business Research Institute, told reporters in Nandu.

The degree of attention to the coffee category directly determines its performance in the channel and market. A source familiar with the domestic instant coffee market told Nandu that Mondelez's biscuit business in China is too strong, resulting in sales staff generally pay more attention to biscuits, in addition, its product line is relatively simple. "the volume of the biscuit business in China is several times that of the coffee business." The person pointed out.

In addition, in the product line, Maxwell and Nestle also have a more obvious gap. "although Maxwell has many flavors, it is mainly three-in-one coffee, while Nestl é not only has three-in-one coffee, but also has higher-end espresso, bottled coffee, canned coffee and other different product forms." The above-mentioned sources pointed out.

In Zhu Danpeng's view, if the sales volume is more than 2.5 times that of the first brand, it is basically difficult to catch up. Now Mondelez reorganizes its coffee business, its focus in the Chinese market should not be to catch up with the first place, but to expand its own market under the growing market environment of Chinese coffee consumers.

With regard to the spin-off of the coffee business to form a joint venture, the above channels believe that it should be conducive to the development of its coffee category in the Chinese market, but in view of the fact that Aikang's popularity in China has not yet been established, how much impact the new company will have on the Chinese market remains to be seen.

The instant coffee market faces a battle of upgrading.

However, it is worth noting that many subtle changes have taken place in the Chinese coffee market. If 3-in-1 coffee fosters Chinese coffee consumption at low prices, then with the upgrading of consumption, ordinary 3-in-1 coffee has encountered a growth bottleneck.

Two and a half years ago, you Yijia (Shanghai) Food Trading Co., Ltd. introduced its coffee brand K O PIK O to the Chinese market. "We did some research before entering the Chinese market. At that time, solid instant coffee was mainly 3-in-1 instant coffee, and the products were more popular. But at the same time, the development of Starbucks has led to the annual growth rate of the domestic high-end coffee market. " You Yijia told reporters in Nandu that Bike first introduced the differentiated concept of Italian coffee into China's instant coffee market, and its positioning at that time was to pursue coffee with higher end, better taste and better quality than three-in-one coffee. For example, Bike will mix chocolate powder to consumers, and the coffee will have a layer of milk foam like freshly ground coffee.

After two and a half years of operation, you Yijia revealed that Biko's market share is second only to Nestl é and Maxwell, and the gap with Maxwell's market share is only less than one percentage point.

According to you Yijia, the rising demand for ground coffee will, to a certain extent, squeeze into the instant coffee market. The future market of instant coffee lies in keeping its cost-effective advantage and improving its quality at the same time.

Under the great integration of Mondelez and Ecole coffee business, it will become a global giant specializing in coffee products with sales volume of more than 7 billion US dollars. Such adjustments also leave unlimited suspense to the Chinese market. At present, Maxwell is more seen by consumers in the Chinese market, but Mondelez has many well-known coffee brands around the world, such as Jacobs, Carte N oire, G evalia, K enco, T assim o and so on. Collected and written: Huang Lishang, a reporter from Nandu

The annual sales market of coffee in China is 70 billion yuan. From 2010 to 2015, Chinese cities consumed an average of 4 cups of coffee per person per year, while Beijing and Shanghai consumed only 20 cups per person per year in big cities. In Japan and Britain, each person drinks an average of one cup of coffee a day.

2 coffee beans from Yunnan are supplied to the world's top five coffee giants-Nestle, Maxwell, Kraft Foods in the United States, Newman in Germany and Ikam in Denmark.