Baijiu manufacturer eyes overseas success

Chinese liquor brand Jiangxiaobai aims to sell its small-bottled baijiu abroad, particularly in India, Myanmar and Singapore, in the latter part of this year, said the founder of the company.

Jiangxiaobai is a relatively young baijiu brand that started in 2012 in Chongqing. Unlike most baijiu products in the market, Jiangxiaobai's bottles tend to be cheaper and smaller, usually 100ml and with a lower alcohol content.

"It is hard for Chinese liquor to go abroad, and even if it does, it is mostly sold in Chinatowns or Chinese restaurants," said Tao Shiquan, founder of Jiangxiaobai. "But in reverse we can see a growing expansion of the popularity of whisky and vodka in China. Why? Because baijiu products don't fuse with the foreign liquor drinking culture."

How to internationalize China's national drink has always been the concern of the nation's baijiu distillers.

"In terms of distilled alcohol, Chinese baijiu has the world largest production volume, yet only 3 percent of the global market share," said Liu Xiuhua, vice-chairman of the China Alcoholic Drinks Association.

Tao's solution is to make baijiu lighter, smoother and easier to mix with soft drinks.

"We have found dealers in 22 countries, including South Korea, France, Germany and Italy, with the major focus on India, Singapore and Cambodia," he said. "We also found that the acceptance of baijiu in Southeast Asia is very similar to China."

Apart from its global vision, Jiangxiaobai aims to dig deeper into the youth market.

"The younger generation doesn't think baijiu is cool. In most scenarios they are forced to drink baijiu due to social obligations," he said.

To make baijiu-drinking trendy, the brand is making itself more culturally relevant, by engaging in social media campaigns and sponsoring music festivals.

Dai Yuexiang, executive director of Hillhouse Capital, an investment management firm, shared a similar view.

"When young people select baijiu, they care less about the flavor. They want the liquor to be easier to drink and less potent," she said. "Traditional baijiu products can no longer meet such demand."

According to the company, Jiangxiaobai sales reached 1 billion yuan ($146 million) in 2017. But compared to China's 565 billion yuan baijiu market, this is just a drop in the ocean.