Produced by | Dali Finance
Text | Wei Li
JD was the first to stand out and break the chaos in the pet food industry.
Ms. Liu, a girl from Jinan, cares about the safety of her pets' diet. Every time she changes new dog food or new snacks she buys, she must taste it first to determine whether it is suitable for her own dog food. With the arrival of family-style pet raising, pets have been regarded as members of the family, so they are paying more and more attention to their dietary safety.
According to the "2022 China Pet Industry White Paper", the penetration rate of Chinese pet family in 2022 will exceed 20%, which is only 1/3 of that of the European and American markets. Chinese pets still have a lot of room for growth in the future. The physical pet market size of China reached 115.8 billion, and the share of pet food further increased to 46%.
The pet market has great opportunities and new growth drivers. Young families without children are more willing to promote the pet accompanying parents program. China's 150 million middle- and high-income elderly people have driven the growth of pets. Some gold and silver-haired groups regard pets as family members, which are very detailed and particular.
For this reason, JD Pet initiated a Pet Food Raw Materials Integrity Alliance. Recently, at a media communication meeting, Liu Lu, general manager of the pet business department of the Dashang Super League omni-channel business group of JD Retail Group, revealed that in the future, the alliance will be committed to improving the supply chain of pet food and establishing an end-to-end omni-channel traceability system. At the same time, through the joint efforts of multiple parties in the industry, improve the pet industry standards, and at the same time, the introduction of professional third-party testing institutions in continental testing and testing has also given the alliance more powerful professional guarantees.
Looking back on the past two years, the growth rate of JD Pets has always been more than three times higher than the industry level, and has become the industry-recognized largest sales increase market for brands, and has helped many brands achieve certain growth in an uncertain market environment.
As of this year, there have been more than 200 brands, and the sales of on JD Pets increased by more than 4100% year-on-year, and more than 100 brands of increased by more than 450% year-on-year. At the same time, JD Pet has also achieved leading industry-leading category growth in trend categories such as baked grain, freeze-dried grain, and smart cat litter box, and has become the main battlefield for the growth of trend categories in the pet industry.
not only should lead the industry to achieve high growth rate and drive brands to achieve more business growth, but JD Pet is thinking and promoting how to promote the high-quality and sustainable and healthy development of the pet industry. From this point of view, it is not surprising that the Pet Food Raw Materials Integrity Alliance appears in JD Pet’s strategic plan.
At present, the Pet Food Raw Materials Integrity Alliance has obtained more than 100 industry authoritative institutions including Feed Research Institute of the Chinese Academy of Agricultural Sciences, Feed Volume and Safety Supervision, Inspection and Testing Center of the Ministry of Agriculture and Rural Affairs, Pet Industry Branch of the China Animal Husbandry Association, China Economic Information Service Xinhua Credit, New Hope Liuhe , Cargill Animal Nutrition, Mars Pet, Guaibao, Zhongpean, NetEase Yanxuan, New Hope Youlang, Hano, Fubei, Continental Testing, Huasilian and other more than 100 industry authoritative institutions and upstream and downstream partners of the industry chain are involved.
Pet complaints have increased by 90%
Food has become a severely affected area
In recent years, such "toxic" food incidents have been common and attracted attention. The problems that arise are very complicated, such as in mild cases, foreign objects such as metal and plastic appear in pet food, and even in pet food, poisoning and death.
In the first half of this year, China Consumers Association released an analysis of the complaints accepted by the National Consumer Association, showing that in the first half of 2022, consumer complaints generally showed an upward trend. Among them, in the first half of 2022, the National Consumer Association accepted 6,617 pet complaints, an increase of nearly 90% year-on-year.
Although food safety problems occur frequently, the pet food industry has always occupied a huge market share in the pet industry , and the market is expanding rapidly. The report
shows that the global retail scale of pet food will reach US$123.6 billion in 2022, with a CAGR of approximately 4.4% from 2012 to 2022. From 2012 to 2021, the retail scale of pet food market increased from 5.73 billion yuan to 48.19 billion yuan, and is expected to further increase to 54.18 billion yuan in 2022.Except for the impact of the epidemic in 2021, most of the annual growth rate of market size has remained above 14% since 2012, and the CAGR has reached 25.2%, far higher than the world average.
Among them, pet staple food accounts for the highest proportion of the entire pet food consumption structure, with dog staple food consumption accounting for as high as 80%, and cat staple food accounting for 60%. Therefore, the safety of pet food, especially staple food, concerns the life safety of hundreds of millions of pets, and is also the most concerned part of pet owners.
General manager of the pet business department of JD Retail Group Dashang Super League omni-channel business group, said, "Now many pet owners are very professional pet raising experts. They are more concerned about the ingredients of pet staple food, and they even do various assessments themselves, finely to the origin of a certain ingredient, and pay attention to whether its origin is safe. For some products containing marine biological ingredients, they will see if they come from Nordic, Norway, and other regions. Their pet raising is becoming more and more refined, and there will be many new needs, such as products for special pets, which will be divided into different age groups. In addition, the growth of prescription grains is also very good."
The significance of establishing the Pet Food Raw Materials Integrity Alliance is to achieve the effect of good money driving out bad money. Liu Lu said that the entire pet industry has grown very fast and has also brought some problems. At present, the national standards and relevant laws and regulations for pet staple food are not mature, which has caused industry chaos such as the use of inferior raw materials on the upstream industries, or false product standards.
It is difficult for consumers to judge during the purchase process, and there is no relevant information on the traceability of pet food raw materials. Therefore, in the past, there were indeed some problems in the pet industry, such as the product raw materials did not meet the standards, which caused some cats and dogs to have health problems after eating, which made consumers have a crisis of trust in the entire industry.
In fact, both companies and users hope that pet food raw materials will be transparent. For enterprises, we hope to reach consumers through good products, and at the same time let consumers understand how the company makes good products and transparent production information. In this way, good enterprises can highlight their advantages and achieve the effect of good money driving out bad money.
For users, there is a relatively authoritative platform to tell them more information about the products they are purchasing. This transparent process has a driving force for both the upstream and the downstream, and is also conducive to the healthy development of the entire industry.
End-to-end full-link traceability
allows every bite of dog food to be traced back to
For pet owners, they hope that every bite of dog food of pets is safe and traceable. Just like Ms. Liu at the beginning, she hopes that the dog will eat healthy food, not poisonous food that is worse than feed. The chaos in pet food safety has broken through, why is JD pet standing up? JD.com is always at the forefront in leading the sustainable development of the industry and needs to rectify the breakthrough of consumption chaos.
This happens to be JD.com’s vision and starting point for launching the alliance, but this goal is actually not easy to achieve. Especially, in a rapidly developing industry like pet staple food, how will JD.com leverage the upstream and downstream of the industry and realize the construction of the entire system?
In this regard, Zhou De, head of the alcohol and pet business improvement department of JD Retail Group's Dashang Super League omni-channel business group, summarized four main lines: First, create end-to-end pet food full-link quality traceability, and establish quality traceability from raw materials to products obtained by the end consumers.
Second, we and our upstream and downstream partners in the alliance's industrial chain are designing and preparing to promote product quality certification, and intend to establish a full series of standards, including covering the production process of pet food raw materials, finished product testing, trial feeding tests, and consumer reputation evaluation, so that consumers can identify high-quality pet foods more simply and systematically.
Third, promote industry standards and participate in the establishment and improvement of industry standards. At present, JD Pet has joined hands with Pet Cat and Health Commission, brand parties, and industry leading producers have launched the "Baking Full-price Cat and Dog Food Group Standard", and has also actively participated in the formulation and revision of multiple industry standards.
Fourth, regarding knowledge and user education in the entire industry, the alliance will establish an educational base for quality science, and through live streaming exploration, experience live streaming interaction and offline pet owner interaction forms, help pet owners fully understand product quality and develop a scientific and systematic pet raising concept.
Zhou De believes that quality and safety are an important factor in solving consumer user confidence. "All the work we do is centered around quality and safety as the core point and ultimate goal. In addition to doing a good job in the industry and ensuring quality and safety, we also need to have more transparency for C-end consumers. We will continue to do consumer-side user education, such as inviting professional institutions and professional industry experts to preach to users through online and offline interactions, and strengthen consumers' awareness and trust in the entire industry."
The introduction of third-party testing institutions ensures that the entire process is safer and more transparent. Xu Quan, head of the Consumer Products Division of the North District of Continental Testing, said that there are many chaos in the pet food industry at present, mainly reflected in five points: First, the product raw materials are opaque; second, the formula labeling is inaccurate; third, the abuse of artificial additives and food additives; fourth, the factory sterilization process is imperfect; fifth, the problem of damaged packaging in the process from the logistics end to the consumer.
Continental joins the Pet Food Raw Materials Integrity Alliance as a third-party testing agency, which can provide professional guarantees. Xu Quan said that on the one hand, relying on the detection capabilities of the continent, the full coverage of the pet food industry can be achieved; on the other hand, the pet market is an emerging industry in China, but it has been a long period of development around the world. As a French company, Continental has a strong international platform system and rich experience.
General Manager of Zhongpeng Shares Market Management Center Hao Chenlong said in an interview with Dali Finance that the standards of many pet foods are still not completely consistent. Although China has national standard feed standards, the specific implementation of pet food is not currently unified, so Zhongpeng has been encouraging and calling for industry self-discipline. JD.com is actively promoting the transparency of pet food raw materials, and Zhongpeng also hopes to communicate with JD.com to establish and improve industry standards, and promote them simultaneously among participating companies.
Output industry raw material transparency solution
Reduce the supply chain fulfillment cost in the entire process
JD has been thinking about how to give full play to its own supply chain advantages and capabilities to help and achieve cost reduction and efficiency improvement in the entire industry. Zhou De said that in terms of reducing costs and increasing efficiency of the entire chain supply chain, JD.com looks very detailed, such as from the raw material factories of upstream suppliers to JD.com, and then to end users, the link design of this supply chain, the construction of the warehouse distribution network, the layout of the warehouse network, and the cost optimization in the entire process. The success of the
solution will reduce the supply chain fulfillment cost in the entire process, thereby giving more low-priced and high-quality products to end users. This is also a key move for JD Pet to link upstream and downstream and exert its entire supply chain capabilities.
In other words, JD.com wants to promote the industry to form a complete set of transparent raw materials through the power of the alliance. If this solution can be successful, the entire industry will benefit greatly. The establishment of the
alliance is just a beginning, and there will be a lot of work in front of JD pets in the future. For consumers, although the road is long, it is a good start for some people to start doing it. I hope that China's pet food industry can develop healthily in the future.
exquisite pet raising, people's pet relationship upgrade, happy coexist, friends and family.
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