Gu Yue Longshan tests the "contract system" reform!

(Source: 21Style)

(General Manager of Guyue Longshan, Ma Chuan)

Text by: Xiao Xia

Faced with a new rising cycle of Huangjiu, the industry leader has decided: we can no longer use old methods to capture the market.

On March 26, the Chengdu Spring Sugar Meeting officially opened. On that day, Guyue Longshan held a Southwest Market Investment Launch Conference at the exhibition, where General Manager Ma Chuan officially disclosed: not long ago, the company underwent a significant internal adjustment, integrating the Southwest markets of Sichuan, Chongqing, Yunnan, Guizhou, Guangxi, and Tibet, and officially established the Guyue Longshan Southwest Branch, which will implement a contracting model for the first time.

Journalists from the 21st Century Business Herald learned on-site that Guyue Longshan is the first to adopt the “three-pack” model of “cost contracting, target contracting, and profit contracting” in the Southwest Branch, granting the branch independent rights for investment, pricing, promotion, and human resources.

In simple terms, how the Southwest Branch decides to use expenses for investment in areas such as investment, marketing, and human resources will be determined by the branch itself. The income of the Southwest Branch team will depend on the completion of performance targets; the better the completion, the higher the profit, and the more incentives the team can earn.

“This is not a simple regional reorganization, but a strategically significant adjustment, a deep transformation from mechanisms to concepts, from management to execution,” emphasized Ma Chuan.

Pilot “Contracting System” in the Southwest Region with a Goal to Double in Three Years

“The adoption of this ‘three-pack’ model is aimed at truly allowing those who can hear the gunfire on the front lines to make decisions,” Ma Chuan told reporters from the 21st Century Business Herald.

To ensure the new company progresses smoothly, Guyue Longshan decided to implement a high-level management structure—the General Manager of the Guyue Longshan Southwest Branch will be directly held by the current Chairman and General Manager of Guyue Longshan Sales Company, Zhu Guoan.

“I may spend 25 days in Chengdu over the next month,” Zhu Guoan told reporters from the 21st Century Business Herald.

Zhu Guoan introduced that after the establishment of the Guyue Longshan Southwest Branch, it will follow a three-step plan over three years: the market initiation phase, completing the layout of core cities, launching customized products for the Southwest, and initially establishing brand awareness; the market growth phase, expanding to more cities, deepening channel construction, and increasing promotional efforts; the market maturity phase, consolidating leadership position, optimizing product structure, and enhancing brand premium capability.

According to reports from the 21st Century Business Herald, in the six markets of Sichuan, Chongqing, Yunnan, Guizhou, Guangxi, and Tibet, Guyue Longshan currently has an annual revenue scale of several tens of millions, and the goal for the Southwest Branch is to at least double this figure in three years.

Compared to the non-Jiangsu, Zhejiang, and Shanghai markets like Beijing-Tianjin-Hebei, Shandong, and Henan, where Guyue Longshan has a certain foundation, the choice to implement a new model in the Southwest market presents less reform difficulty and greater growth potential. In the first three quarters of 2025, 43% of Guyue Longshan’s revenue will come from non-Jiangsu, Zhejiang, and Shanghai markets, leading the industry in the Huangjiu sector.

Another factor is the consumption potential of the Southwest market itself.

Zhu Guoan mentioned that the Southwest region has a population of 200 million, with enormous consumption market potential, especially in Chengdu and Chongqing where consumption is vibrant. Additionally, the Southwest is also an important liquor market, which has always had a higher acceptance of new products and new consumption concepts.

On that day, the Guyue Longshan Southwest Branch also signed contracts with four distributors and launched three customized products specifically for the Southwest market: a customized Huangjiu in collaboration with the local trendy bar brand “Panda Bar,” a plum Huangjiu brewed with wild green plums from Mabei, Sichuan, and a portable traditional Huangjiu designed for the younger demographic. These three new products are expected to officially launch in May this year.

(Founder of Panda Bar Cheng Jianjun signs a contract with Guyue Longshan Southwest Branch General Manager Zhu Guoan)

“The Southwest Branch will not only be responsible for promoting the customized new products in collaboration with distributors, but also the company’s existing core products, such as the high-end Guoniang series, Qinghua Zui series, and the youth-oriented representative product ‘Wu Gaodiao,’ will also be managed by them,” said Zhang Leiguang, Deputy General Manager and Secretary of the Board of Guyue Longshan, to reporters from the 21st Century Business Herald.

“Reform has reached the point of ‘no breaking, no establishment.’”

Ma Chuan revealed to reporters from the 21st Century Business Herald that the new “contracting system” model adopted in the Southwest region was officially conceived in the second half of last year, and it took only a few months to implement it.

“Actually, the internal reforms of Guyue Longshan have been ongoing, but since last year we felt that reform has reached the point of ‘no breaking, no establishment,’” said Ma Chuan.

The background for this internal mechanism reform at Guyue Longshan is that the Huangjiu sector has seen a new rising momentum in the past two years, particularly since last year, the Huangjiu sector has garnered significant attention in the capital market, with several listed Huangjiu companies experiencing a rise in stock prices.

Objectively speaking, Kuaijishan has soared even higher on this rising tide, with its stock price doubling last year and its market value once exceeding that of Guyue Longshan (though it was later surpassed; as of the close on March 26, Guyue Longshan is the number one in market value in the Huangjiu sector).

For Guyue Longshan, which has long held a higher position and larger scale, there is both pressure and motivation.

The pressure lies in the fact that Guyue Longshan has long been the leading brand in Huangjiu, maintaining advantages in business scale, vintage liquor reserves, corporate history, industry position, and nationalization level. However, Kuaijishan has been catching up quickly, significantly narrowing the gap in performance.

The motivation comes from the privately-owned Kuaijishan, which has made significant achievements in product innovation and market expansion in recent years, due to its ability to better stimulate endogenous power through mechanism and model reforms. Guyue Longshan can completely draw from this experience of releasing development momentum through mechanism and model reforms; however, as an established state-owned enterprise, how to fully weigh the pros and cons of reform and demonstrate the courage of “no breaking, no establishment” is a key prerequisite for the successful implementation of internal mechanism changes.

Reporters from the 21st Century Business Herald noted that the adoption of the “contracting system” by the Guyue Longshan Southwest Branch is described as a “pilot.” This means that if the branch’s new model receives a positive response and breakthroughs, it is possible that it will be extended to more potential markets in the future, further promoting nationalization and opening up new growth space.

“This reform in the Southwest market is a key step for Guyue Longshan on the national map, which will provide a model and accumulate experience for the national layout of Guyue Longshan,” said Ma Chuan.