China has ushered in a node where the proportion of foreign food has accelerated, and the demand for catering convenience and safety has increased. We are optimistic about the standardization opportunities in all links of the catering supply chain. The proportion of external food on the demand side accelerated, and the requirements for catering convenience and safety increased; The demand for cost reduction at the supply end is strong. The chain and national expansion need the support of modern supply chain. The resonance of supply and demand catalyzes the standardization of catering supply chain. There is room for Standardization in all links of China's catering supply chain, including upstream agriculture, midstream food manufacturing, downstream catering and circulation.
Prefabricated vegetables help meal enterprises reduce costs and increase efficiency, and have a broad application prospect. The use of prefabricated dishes can effectively save the labor and energy costs of catering enterprises. According to the data of China chain operation association, the net interest rate of typical restaurants can be increased by 7pct after switching to prefabricated dishes. It is expected that when the demand side requires convenience and efficiency and the supply side requires cost reduction and efficiency increase, it will have a broad application prospect in the catering field in the future.
The prefabricated vegetable industry has low entry barriers and high expansion difficulties. At present, there are many players in the industry and the pattern is scattered. By the end of April 2021, there were 72000 existing enterprises related to prefabricated dishes, and 13000 newly registered enterprises in 2020 alone. New entrants to the industry continued, and the pattern was still scattered. We mainly analyze the following two reasons: 1) there are many kinds of dishes, there is a distribution radius in the cold chain, and the regional characteristics are obvious; 2) The difficulty of single product production is low and the ceiling is visible, but the difficulty of raw material procurement, inventory management and flexible production has increased significantly after the expansion.
There are mainly five types of players in the prefabricated vegetable industry, with different advantages and challenges: 1) professional prefabricated vegetable enterprises: they have strong product development ability and certain channel advantages, but their locality is obvious, representing the enterprise's Suzhou Weizhixiang Food Co.Ltd(605089) revenue scale of 620 million yuan in 2020 and cagr20 million yuan in 2016-2020 4%。 2) Quick frozen Enterprises: the business extends horizontally. The supply chain layout such as leading scale procurement, land sales capacity, cold chain transportation and channel resources can be reused, or can realize nationalization faster. They also face the challenges brought by the increase of SKU. For example, the scale of dish products in Fu Jian Anjoy Foods Co.Ltd(603345) 2020 is RMB 670 million, and the CAGR from 2017 to 2020 is 30.5%. 3) Agricultural enterprises: the raw material side has natural advantages, and the channel resources of the head agricultural enterprises are reusable. There is a high probability of being a leader in the field of conditioned meat products. Product development and marketing are challenges, and overseas successful representatives such as Tyson. 4) Catering enterprises: empower their own catering business and supplement income. They have the advantages of brand endorsement and store channels, and are expected to form business collaboration. However, there is a scale threshold for vertical integration. At present, most of the head catering enterprises' prefabricated dishes business is in the initial stage. 5) Retail enterprises: private brands focus on the needs of family convenience and delicacy, and products mainly rely on the integration of supplier resources.
Investment advice
We are optimistic that the proportion of foreign food in China will continue to increase, maintain the "overweight" rating of the catering industry, and suggest paying attention to the investment opportunities brought by the standardization of the catering supply chain. For the catering market of prefabricated dishes, we believe that the first four types of enterprises have opportunities. Among them, professional prefabricated dish enterprises can finely meet the needs of local small and medium-sized catering, takeout, group meals, rural kitchens and hotels. It is recommended to pay attention to Suzhou Weizhixiang Food Co.Ltd(605089) ; The leading supply chain capacity of quick-frozen enterprises can be reused. It is suggested to pay attention to Fu Jian Anjoy Foods Co.Ltd(603345) and so on; Agricultural enterprises have obvious advantages in the field of conditioning meat products; Catering enterprises are more optimistic about chain brands that can form positive synergy with their own catering business and cross the scale threshold.
Risk tips
Industry competition intensifies; Downstream demand is lower than expected; Repeated epidemic situation; Food safety risk
