Mengniu Dairy announced on the evening of March 26 that in accordance with the group's strategic arrangements, Lu Minfang will serve as the company's vice chairman, step down as president and continue to serve as executive director. Gao Fei, the former senior vice president and head of the normal temperature business unit, took over as president and served as executive director.
Gao Fei thus became the fifth president of Mengniu. Mengniu said that this management adjustment is an important decision made by the Board of Directors of Mengniu Group based on medium- and long-term strategic considerations, and it releases the signal and confidence to make Mengniu bigger and stronger.
Lu Minfang resigned as president of Mengniu
Information shows that Lu Minfang was born in 1969. Before becoming the president of Mengniu, he worked for Danone and Yashili Group. In September 2016, Lu Minfang was appointed as the president of Mengniu Group. He has led Mengniu back to the growth track by implementing strategic business layout, strengthening corporate governance capacity building, and promoting sustainable development. Since 2016, Mengniu's performance has exceeded multiple tens of billions, and its scale has doubled in eight years, ranking among the top ten in the global dairy industry.
Lu Minfang resigned as president of Mengniu and became vice chairman. Image provided by the company
Improving Mengniu’s business segment through mergers and acquisitions is another important change brought to Mengniu during Lu Minfang’s leadership. In 2017, Mengniu increased its holdings in Modern Dairy shares and became the controlling shareholder. The two parties deepened their collaboration in raw milk sales, branded milk sales, financial financing, feed procurement, etc., allowing Modern Dairy to focus on the upstream breeding link. The following year, Mengniu acquired China Shengmu, which features organic milk sources, and thus completed the basic layout of upstream milk sources. In 2021, Mengniu will subscribe for a controlling stake in the "No. 1 cheese stock" Mioclan, and carry out multi-faceted and multi-dimensional business cooperation such as jointly building sales channels, sharing marketing resources, improving production capacity layout, and purchasing raw materials.
Mengniu, under the leadership of Lu Minfang, is also accelerating its internationalization process. The New Zealand Yashili factory and the Indonesian Youyi c factory have been completed one after another. It has strategically acquired Australian raw milk processor burra foods, organic infant milk powder and food brand Bellamy's, Aixue, Indonesia's largest ice cream brand, operates in more than ten countries and regions in Southeast Asia, Oceania, North America and other regions, and has completed the transformation from "Chinese Cow" to "World Cow".
Talking about M&A strategy, Lu Minfang told a reporter from the Beijing News in 2020 that a very important point in Mengniu’s M&A is that it is strategically driven, not just for scale. In 2018, when Mengniu launched Modern Dairy and China Shengmu, the domestic supply of raw milk exceeded demand. Based on its forward-looking judgment on the future development of China's dairy industry, Mengniu invested in these two upstream dairy companies. "If we were to acquire them today, we would have to spend at least twice the price to do it."
Regarding overseas mergers and acquisitions, Lu Minfang said that Mengniu mainly focuses on the brand value of these acquisition targets, and is preparing strategically for its big development in three or five years. "We are not a resource-based company. If we want to do well in the market, we must rely on brands."
Looking forward to flying high with a goal of 100 billion
Taking over the leadership of Mengniu CEO, he has joined the company since 1999 when Mengniu was founded. Having been deeply involved in the products industry for many years, he has led the development and development of Mengniu’s sales system and contributed to the development of the enterprise. Following Niu Gensheng, Yang Wenjun, Sun Yiping, and Lu Minfang, Gao Fei became the fifth president of Mengniu.
Mengniu’s new CEO Gao Fei. Picture provided by the company
Mengniu’s internal evaluation of Gao Fei is that he has rich experience in corporate management, brand building, talent training, cultural inheritance, innovation and development, etc. Since 2016, Gao Fei has taken the lead in proposing the "championship strategy" in the normal temperature business unit, achieving a year-by-year increase in normal temperature performance, and liquid milk has achieved double-digit growth for five consecutive years.
The high-end brand "Deluxe" created by the team led by Gao Fei has opened up China's high-end dairy product market. Currently, Deluxe has become the largest single product in the world's dairy industry with annual sales of more than 30 billion yuan. In addition, Gao Fei also directed the marketing "campaigns" of Mengniu's Russia World Cup and Qatar World Cup, which enhanced Mengniu's brand value. As Mengniu promotes digital and intelligent transformation, the fully digital and intelligent super factory in Ningxia, which he led the construction of, achieved the world's highest human efficiency ratio of "100 people with an output value of 10 billion", creating a benchmark for smart manufacturing demonstrations.
With the adjustment of Mengniu's management, the industry has become more speculative about when Mengniu will achieve its 100 billion goal. In 2017, Mengniu set a "double 100 billion" goal, proposing that both sales and market value would reach 100 billion by 2020. In 2023, Mengniu's revenue will be 98.624 billion yuan, only one step away from the goal of 100 billion yuan. Now, this important task has been handed over to Gao Fei.
Chief reporter of Beijing News Guo Tie
Editor Zhu Fenglan
