What is the significance of Nestlé agreeing to sell China Water business to Tsingtao Brewery?

I think the meaning of this thing should be viewed from different perspectives. Nestlé sold its water business to Tsingtao Beer, but the specific price was not disclosed. According to the agreement, the transaction includes the local brands "Dashan" and "Yunnan Mountain Spring" owned by Nestlé, as well as Nestlé's three water business factories in Kunming, Shanghai and Tianjin. At the same time, the two parties signed a licensing agreement, and Tsingtao Brewery Group will produce and sell the Nestlé Premium Life brand in China. This also means that Nestlé will hand over all its water business in mainland China to Tsingtao Brewery Group, while retaining international water brand products, including "Perrier", "San Pellegrino" and "Puna".

For Nestlé, it is just a burden. As we all know, Nestlé is an international food company, and it is really good at food. However, except for milk, it really has no advantages in beverages. In our country at present There are many brands such as Nongfu Spring, Yibao, Baisuishan, etc. dominating the market. As a rising star, it is really difficult for Nestlé to get a share of the pie. After all, the former has been deeply involved in the Chinese drinking water market for many years and has already had a broad mass base. , it is very difficult for Nestlé to get involved, so Nestlé wisely sold the water business to Tsingtao Beer.

As for Tsingtao Beer, they should have wanted to enter the drinking water field for a long time, so they were willing to acquire Nestlé’s water business. After the acquisition, Tsingtao Beer’s beverage product line will be more It is rich, but the product line is rich. How to market it is the key. I think if Tsingtao Beer wants to enter the market, it must not only take into account quality but also price. It cannot kill itself like Evergrande Bingquan did. Although the water from Dabingquan is great, it is unfortunately too expensive, so Tsingtao Beer needs to weigh the pros and cons. After all, there are lessons to be learned from the past, so don’t make the same mistake as Evergrande Bingquan. As a consumer, the one who understands consumers best is himself. If Tsingtao Beer's drinking water products can have the consciousness of coming from the masses to the masses. Then I believe they will slowly occupy the market.