Breaking Through Against the Trend: What Does Shed Rely On?

How can AI and channel optimization help Shede Spirits achieve countercyclical growth amid industry downturns?

Channel optimization is a core focus for Shede Spirits’ 2025 strategy. The company continues to deepen its omnichannel operations, promoting channel penetration and structural upgrades.

Produced by | Zhongfang Network

Reviewed by | Li Xiaoyan

On the evening of March 20, Shede Spirits (600702.SH) disclosed its 2025 annual report, delivering a resilient performance amid industry adjustments. During the reporting period, the company achieved revenue of 4.419 billion yuan and a net profit of 223 million yuan attributable to shareholders; simultaneously, it announced a profit distribution plan, proposing a cash dividend of 3.10 yuan per 10 shares (tax included), totaling 102 million yuan, accounting for 45.67% of annual net profit, to maintain shareholder confidence.

Facing the challenges of “total volume contraction and stock competition” in the baijiu industry, Shede Spirits adheres to forward-looking deployment and proactive change. Using inventory reduction as a lever, the company deepens product innovation, channel optimization, and operational quality improvement, driving marginal improvements in key indicators, solidifying its operational foundation, and further demonstrating resilience against cycles. Meanwhile, the company’s sustainable development capabilities have been recognized by authoritative agencies, with the S&P ESG score increasing by 73% year-over-year, strengthening the long-term foundation for high-quality growth.

In 2025, due to factors like weak consumer demand and slower-than-expected scene recovery, the industry faced overall pressure, with many companies experiencing varying degrees of revenue and profit decline, showing a clear trend of volume shrinkage and profit reduction. Against this backdrop, Shede Spirits centers its approach on “pragmatic management,” achieving steady performance through systematic adjustments, with key indicators showing positive changes—“four rises and one fall.”

Core operational indicators continued to improve. During the period, the company’s net cash flow from operating activities increased by 26.08% year-over-year. Revenue and net profit declines compared to 2024 were significantly narrowed (down 24.41% and 80.46%, respectively), confirming a gradually improving business trend. Cost control proved effective, with management expenses down 12.39% year-over-year, and operational efficiency continuously enhanced. Total assets grew to 12.615 billion yuan, up 6.89% year-over-year, strengthening the company’s long-term financial foundation.

Inventory management showed notable results. Shede Spirits prioritized inventory reduction as a key annual task, guiding core products back to rational levels. Through refined channel management and sales incentives, the company maintained stable pricing for flagship products like Shede and Shede Collection 10 Years, easing channel pressure and creating room for future development. Meanwhile, the ordinary liquor business achieved sales of 733 million yuan, up 5.75%, becoming a bright spot and demonstrating product structure resilience.

During industry deep adjustments, Shede Spirits adhered to its “Old Liquor, Multi-Brand, Youthful, International” strategy, focusing on product innovation, channel upgrades, and brand elevation, building a comprehensive growth system to accumulate momentum for cycle navigation.

Leveraging its core advantage of over 100,000 tons of aged liquor reserves, Shede Spirits has established a “core flagship + innovative new products” dual-drive model. Key products like Tuopai T68 have seen sustained rapid growth in sales, becoming engines for mass-market expansion; the Shede Taste channel inventory is being cleared in an orderly manner; Shede Dao sales and bottle openings doubled; Shede Celebrations sales doubled, with product matrix vitality continuously unleashed.

In terms of innovation, the company accurately captures new consumer demands, launching the industry’s first low-alcohol, easy-drinking aged liquor “Shede Zizai,” which won seven awards within four months of launch and expanded into over a thousand retail outlets, successfully attracting younger consumers. It also incubates cultural products like “Shang Ma You Shede” blind boxes and the 24 Solar Terms series, using cultural empowerment to break traditional baijiu consumption boundaries and enrich consumption scenarios. Additionally, Shede Collection 10 Years won the ISC Gold Award and ISGC Grand Gold Award, with product quality recognized internationally.

Channel optimization remains a key focus for Shede Spirits’ 2025 plan. The company continues to deepen omnichannel capabilities, promoting channel penetration and structural upgrades. Online channels achieved leapfrog growth, with e-commerce sales reaching 604 million yuan, up 35.46% year-over-year. Digital operation capabilities significantly improved, enabling precise targeting of younger consumers and becoming a new engine for growth.

Offline, the company deepens channel penetration, upgrades distributor networks to flatter structures, and enhances terminal service capabilities. Key account channels added tens of thousands of stores, covering core consumption scenarios and further consolidating the national channel network. Through the integrated “Factory + Distributor” model, the company enhances channel control and promotes win-win development with partners.

Shede Spirits emphasizes “Old Liquor + Culture” to deepen brand connotations and expand influence domestically and internationally. It continues to develop the “Shede Wisdom Figures” IP matrix, collaborating with celebrities like Evan Kyle, Luo Zhenyu, and Lang Yongchun for major marketing events, strengthening brand resonance with contemporary elites; it also revitalizes the brand spirit of “This era needs Shede,” deepening emotional connections with users.

On the international front, the brand accelerates its overseas expansion, covering 42 countries and regions. The “Shede Old Liquor Festival” reaches more overseas markets; Tuopai intangible cultural heritage techniques are showcased at UNESCO headquarters, promoting Chinese baijiu culture globally. By 2025, the combined brand value of “Shede” and “Tuopai” exceeds 190 billion yuan, maintaining industry leadership.

Under the high-quality development framework, Shede Spirits integrates sustainability into all aspects of operations, with notable results. In 2025, its S&P ESG score increased by 73% year-over-year, and it received honors such as the “Guo Xin Cup ESG Golden Bull Award” and the “Top 100 Chinese Enterprises in ESG 2025,” gaining high recognition from capital markets.

The industry ecosystem continues to improve, with deep integration of wine and tourism. In 2025, the company hosted 230,000 tourists, achieving new breakthroughs in cultural tourism integration; its Tianma glass business saw a 20% increase in operational cash flow year-over-year, highlighting industry chain synergy and injecting vitality into the ecosystem. The company also adheres to ecological brewing principles, leading the formulation of industry standards for ecological brewing and aged liquor storage, practicing green development and corporate social responsibility.

The resilient performance in 2025 lays a solid foundation for Shede Spirits’ high-quality growth in 2026. The company clarifies its core guiding principles of “Strengthen Foundations, Breakthrough, Re-Start,” maintaining its “Old Liquor, Multi-Brand, Youthful, International” strategy, and focusing on optimizing “Product Power, Brand Power, Channel Power, Organizational Power” to enhance cycle resilience.

Strategic initiatives will deepen further. In 2026, Shede Spirits will empower the Yelanggu brand comprehensively, leveraging high-quality aged liquor to create differentiated competitive advantages, enrich product offerings, and expand market space. Relying on Fosun’s ecosystem resources, the company will continue to connect top entrepreneurs, elevating its high-end brand recognition.

During the Spring Sugar Fair, the company will release its full potential: hosting the fifth Old Liquor Festival to deepen the value experience of aged liquor and boost dealer confidence; serving as the “Strategic Partner” and “Exclusive Baijiu” of the 2026 Yabuli China Entrepreneurs Forum to connect top business leaders and convey brand value. During the Spring Festival, the company’s product sales surged, terminal inventory was rapidly cleared, and double-digit growth in bottle opening rates was achieved, marking a strong start to the year and setting a good tone for the full-year development.

Innovation remains a priority. The company will continue product innovation tailored to young consumers, improve aged liquor storage systems, strengthen quality barriers, deepen digital operations, enhance omnichannel collaboration, and upgrade organizational capabilities to sustain long-term growth.

In 2025, amid the deep industry adjustments, Shede Spirits demonstrated resilience through proactive change, pragmatic management, and innovative breakthroughs. From inventory management to product innovation, channel upgrades to brand elevation, ESG practices to ecological layout, each step reflects the responsibility and commitment of a leading Chinese liquor brand.

In 2026, as a pivotal year of industry restructuring, Shede Spirits will follow the principles of “Strengthen Foundations, Breakthrough, Re-Start,” uphold its core old liquor strategy, deepen multi-brand, youthful, and international development, and enhance “Four Powers” to solidify its foundation. With its rich aged liquor heritage, clear strategic path, and strong execution, Shede Spirits is poised to achieve new breakthroughs in stock competition, writing a new chapter of high-quality development and contributing more to China’s liquor industry transformation and upgrading.

Personal opinion, for reference only.