How did ZJLD Group stabilize and rebound amidst a challenging baijiu market?

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ZJLD Group Stabilized and Rebounded Through Operational Optimization and Digital Innovation Amidst a Challenging Baijiu Market

ZJLD Group Inc. achieved stabilization and an operational rebound in the first half of 2026 by proactively optimizing its operational strategies, strengthening channel management, and accelerating digital innovation. These efforts were undertaken in response to a demanding macroeconomic environment characterized by structural adjustments and sluggish consumer demand within the broader baijiu industry. The company's revenue increased by 2.0% year-on-year to RMB 2,546.1 million, with gross profit rising by 3.2% to RMB 1,520.9 million. Adjusted Net Profit also saw a 2.1% increase, reaching RMB 626.1 million.
Strategic Product Mix and Brand Performance Drove Profitability

The Group's gross margin expanded by 0.7 percentage points to 59.7%, a result of an increased revenue contribution from Sub-premium products and the Li Du brand, alongside production efficiencies. The flagship brand, Zhenjiu, generated RMB 1,342.4 million in revenue, representing 52.7% of total revenue, with its strategic product "Da Zhen" achieving nationwide expansion. The Li Du brand demonstrated accelerated growth, with revenue up 28.9% year-on-year to RMB 788.0 million, driven by the national expansion of its Sub-premium and Mid-tier products. Regional brands Xiangjiao and Kaikouxiao maintained solid market share and modest growth. Notably, the Sub-Premium Baijiu Segment performed exceptionally, with revenue up 39.1% year-on-year to RMB 1,366.1 million, capturing growth opportunities from evolving consumer spending habits.
Pioneering Channel Innovation and Distributor Network Expansion

ZJLD Group successfully addressed industry challenges such as price inversion and distributor margin compression through its proprietary "Premier Retailers Alliance" model and the "Monthly Profit-sharing Model." These initiatives effectively resolved long-standing pain points by establishing competitive monthly margins, automating online ordering, and offering sales incentive plans. This approach led to the successful attraction and retention of high-calibre distributors, expanding the Group's distributor network to 8,993 partners as of June 30, 2026, an increase of 710 from the end of 2025.
Omnichannel Marketing and Digital Empowerment Enhanced Brand Value

Complementing channel evolution, ZJLD Group adopted an omnichannel marketing framework that combined "Community Penetration + Digital Empowerment." The company's digital broadcasts and co-created content, exemplified by Chairman Wu Xiangdong's executive video channel, generated significant viewership and traffic. This strategy contributed to Zhenjiu's brand value increasing by 103% over five years to RMB 34.685 billion, solidifying its position among China's top three sauce-aroma baijiu brands.
Advanced Technology Integration and Data Management Capabilities

The Group is anchoring its digital transformation on operational capability and sustainable value creation through the integration of AI and advanced technology. In partnership with China Unicom, an "AI + Expert Blending" framework powered by Large Language Models was developed to enhance blending consistency and efficiency. Furthermore, the digital coding system for "Da Zhen" products was upgraded to incorporate NFC and RFID technology for enhanced traceability and anti-counterfeiting. ZJLD Group also received national Data Management Capability Maturity Model (DCMM) Level 3 accreditation, validating its digital leadership.

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How did ZJLD Group stabilize and rebound amidst a challenging baijiu market?

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