China Agriculture View

Wine is becoming more popular a drink during business meetings.As the alcohol market gets increasingly competitive in China, many Chinese liquor companies are looking to expand market overseas.

The majority of companies going abroad have initialized or plan to begin their overseas development in Southeast Asia, where traditional Chinese alcohol already is very popular. Many also already export to the more developed markets of North America and Europe. 

All respondents plan to export branded products as their main means of developing their overseas presence. A minority of those companies already going abroad are also considering ODI and M&A. Tsingtao Beer, for example, is building a plant in Thailand in order to avoid import duties on beer.

While demand in nearby Asian countries is encouraging a majority of respondents to expand overseas, cultural differences pose a significant challenge to many respondents as they look to enter non-Asian markets, particularly those whose major products are traditional Chinese alcohols. Liquors such as baijiu and huangjiu are very different in taste and smell from beverages traditionally consumed in the West and other parts of the world.

While baijiu and huangjiu may not fly off the shelves worldwide in the near future, demand for traditional Chinese alcohols in neighboring countries will provide respondents with the opportunity to overcome other challenges described above.