Moutai's wholesale price rises, is the wave of baijiu price increases following the trend or forced?
In the past month, the price of Moutai has risen by nearly 100 yuan, and the current first-tier wholesale price of Moutai has reached 950 yuan. Moutai's wholesale price keeps rising, while Wuliangye's first-tier wholesale price has been hovering around 650 yuan. The wholesale price gap between Moutai and Wuliangye has widened from 200 yuan at the start of the year to 300 yuan. With Moutai's wholesale price rising and approaching 1,000 yuan, Wuliangye may further push wholesale prices up by raising its ex-factory price, and its price-increase window may come again.
Moutai forces Wuliangye to raise prices
Moutai's price trend has always been the bellwether for judging the baijiu market. With the Mid-Autumn and National Day peak season approaching, Moutai's price has already risen quietly.
Looking at e-commerce channels, the current price of 53-degree Feitian Moutai on Tmall is 1,049 yuan, on JD.com it is 1,059 yuan, and on Jiuxian.com it is 998 yuan. In physical stores, large supermarkets such as Yonghui Superstores, Metro, and Walmart also sell it at prices above 1,000 yuan.
As terminal retail prices rise, Moutai's wholesale price is also quietly climbing. In early June, Moutai's first-tier wholesale price in Sichuan province was 830-840 yuan; by early August it had risen to 940 yuan, and in some regions the first-tier wholesale price had even broken through 950 yuan. Huatai Securities pointed out that inventories at specially appointed dealers and provincial-level dealers are currently tight, at almost zero inventory; supply is expected to increase after Mid-Autumn, and prices will continue to rise slightly. In addition, after Moutai implemented monthly shipments this year, dealers felt they "could not get enough every month," creating strong expectations of price increases throughout the channel.
After Moutai's price increase, consumers are very likely to settle for the next best option and choose Wuliangye, which is good news for Wuliangye's efforts to hold its price. Huatai Securities expects the first-tier wholesale price of regular Wuliangye to reach 660 yuan at Mid-Autumn, after which the price will continue to rise slowly.
Changjiang Securities pointed out that, unlike ordinary consumer goods where a price cut can expand share, the price level of baijiu relates to brand positioning and thus affects long-term share. Therefore, with Moutai's wholesale price rising, Wuliangye may further push wholesale prices up by raising its ex-factory price, narrowing the price gap with Moutai.
Brokerages raise Wuliangye's target price
From August last year to now, in less than a year, Wuliangye has already raised prices twice. The first price increase was in August last year, when Wuliangye announced it would raise the price of regular Wuliangye from 609 yuan/bottle to 659 yuan/bottle; the second was during this year's Spring Sugar and Liquor Fair, when the company announced it would raise the ex-factory price to 679 yuan and cancel the 30 yuan subsidy, with the circulation price raised to 660 yuan/bottle in the first stage and a target of 700 yuan/bottle in the second stage.
Currently in e-commerce channels, the price of regular Wuliangye on Tmall, JD.com, Jiuxian.com and others is all 729 yuan.