Drinks tycoon in surprise move

Local governments in Europe backed their 10-day trip to Europe but it emerged they visited at the wrong time.

"We arrived during the wrong season," Zong said. "We missed the ordering season for the autumn and winter collections. So this month, we are going to Europe to get the next season's collections."

In addition to cutting out unnecessary distribution channels, Zong said the quick expansion of his shopping centers will push up profitability and benefit his suppliers abroad.

The group invested 1.7 billion yuan for the first phase. Zong expects to establish another five to 10 shopping malls next year and a total of 100 in five years across the country, he said. The new shopping centers are designed to be comprehensive facilities with a theme of Western top-end brands accompanied by retailers of children's products and entertainment centers, he said.

"We want to sell more at a lower profit than other luxury dealers," he said. "Once you open more shopping malls you develop a bargaining leverage: The prices will be lower and products become more competitive."

Doubts remain whether a man known only for making and selling soft drinks will manage as a broader retailer. Zong maintains that if he can manage manufacturing, he can certainly run retail. In fact, the billionaire started making his fortune from retail.

In 1987, the then 42-year-old Zong managed a mini-grocery store for a local school, along with three retired teachers.

"I once sold 100 popsicles by knocking door to door only to get four yuan in return," the chairman said. "Now I might make a loss at first but once I have more brands I will get more investment because I have a great reputation in China."

In comparison with the going-abroad trend among Chinese private billionaires, Zong wants to move in the opposite direction.

"If you go abroad and sell, you merely aggregate competition. They won't like you. If I buy from abroad, they will like and support me," he said.

Italian companies are satisfied with the opening of the first physical department store in Hangzhou and their systemic and sustainable approaches to invest in Italian products, said Laspina of ICE.

Because of the time they visited companies in Italy, Wahaha will be able to distinguish what is suitable to the market, he said.

 

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