On the evening of October 21, VATS Liquor Store officially released its performance report for Q3 of 2021. During the reporting period, its revenue and net profit grew substantially.

To continue “hot sales in slack seasons”, VATS Liquor Store continued to implement the strategy of customized boutique wine + chain stores, expanding the effect of the authentic chain brand. Unsurprisingly, both of its revenue and net profit grew substantially.

New Revenue and Net Profit Records Again, “Greater Value” in Performance Growth

It is reported that VATS Liquor Store still performed remarkably compared with the same period last year even when the traditional liquor industry entered the slack season. Compared with the same period last year, VATS Liquor Store received revenue of RMB 5.971 billion in the first three quarters of 2021, a YoY increase of 62.25%, a record high in the same period in history; the net profit attributable to listed companies was RMB 580 million, a YoY increase of 81.33%, a new record again.

VATS Liquor Store’s revenue in the third quarter of 2021 was RMB 2.017 billion, a YoY increase of 53.08%, and its net profit attributable to shareholders of listed companies was RMB 214 million, a YoY increase of 100.54%. Both revenue and net profit attributable to listed companies created new records in the same period in history and in a single season.

It is worth mentioning that VATS Liquor Store reported revenues of RMB 2.353 billion and RMB 1.601 billion and net profits attributable to shareholders of listed companies of RMB 191 million and RMB 179 million in the first and second quarters of 2021, respectively. Both outperformed any previous quarter. In other words, the company had the best three quarters of 2021 among all single quarters in history. 

Steady Expansion of Supply Chain of Famous Wines and Significant Growth Rate of Customized Boutique Wines

The announcement indicated that VATS Liquor Store continued to expand its global supply chain of famous wines, and it was the substantial growth of customized boutique wine and famous wine sales that drove up the sales revenue and profit. Among them, releasing the production capacity of non-standard customized boutique wines such as Diaoyutai and Lotus also contributed to the remarkable performance. As customized boutique wines was better recognized in the market, price hike and production capacity release contributed greatly to the profit.

As a leading premium wine marketing and service provider in China, VATS Liquor Store has built a sales system that basically covers the whole country. It not only maintains close strategic partnerships with liquor companies such as Moutai, Wuliangye, Fenjiu, Gujing Gongjiu, Diaoyutai, Lotus, and Xijiu, but also developed customized boutique liquors with upstream liquor companies, including “Kweichow Moutai (Gold)”, “Wuliangye Vintage Liquor”, “Diaoyutai Boutique Liquor”, “Lotus Liquor”, “Gujing Gongjiu 1818”, and “Hutou Fenjiu”. In terms of imported wines, VATS Liquor Store has continued in-depth cooperation with foreign wine groups such as Pernod Ricard and Lafite Rothschild in constantly enriching the product matrix of famous wines.

Industry insiders believe that the personalized and diversified demand as a result of upgraded consumption patterns has stimulated the rapid expansion of the customized wine market. Endorsed by its strong brand, long-term stable partnerships with upstream manufacturers, and its own scale advantages, VATS Liquor Store enjoys great competitive advantages in the branding, cost performance and target markets of customized wines.

In the first half of 2021, VATS Liquor Store not only established strategic cooperation with Lai Gaohuai’s brand and the internationally renowned spirits group Pernod Ricard, but also cooperated with Lotus in launching a new strategic product named Lotus Jade 16 under the series of Lotus Jade. It is reported that the strategic layout for this series has been completed throughout the country and it made a significant contribution to the performance.

More and Better Stores, and Benefits from Channel Reform

By September 30, 2021, the number and quality of direct supply terminal stores and VATS chain stores had been steadily improved, along with a continuously optimized channel structure, further improved customer stickiness, significantly better distribution capabilities, and substantial growth of sales revenue year-on-year.

According to the company’s business data announcement, VATS Liquor Store continued to promote the transformation of high-quality retail outlet customers into members of VATS Famous Wine Alliance in different provinces and regions in the first three quarters of 2021; stores were upgraded to 3.0 and implemented the “323 Regulations”, coupled with digital management and other initiatives that were paying off. 

Developing chain stores in core regions is an important strategy adopted by VATS Liquor Store in 2021, including continuously and steadily promoting the expansion of brand chain stores, continuously sinking to the second- and third-tier markets where the company has already made presence, enhancing its regional competitiveness, developing new markets in important regions simultaneously, and opening flagship stores when appropriate to increase the scale and quality of the chain stores. At the same time, VATS Liquor Store continued to deepen its efforts in 700 regions where consumers could afford mid- and high-end wines across the country, expanded the radiation scope of its marketing grid system, and strengthened the talent reserve, recruitment, selection and training mechanism.

The substantial growth of performance also means that the effect of the authentic chain brand will continue to expand. “You can always buy authentic and famous wines in VATS” have become further shared awareness among channels and consumers. When making eight important strategic deployments in 2021, Wu Xiangdong, chairman of VATS Liquor Store, indicated that the company must always pay attention to branding, must protect the corporate image of “quality, authenticity, service, and innovation”, and must win recognition and trust from customers. He also encouraged the company to make more efforts in brand building, to keep enriching the connotation and extension of the brand, and to continue to enhance its value and influence.