Rebirth in Hong Kong: From Dessert Shop to Industrial Empire

Chapter 129 280,000 Vending Machines (First update of 10,000 words per day, please vote with monthly tickets and recommendations, please continue reading)
On January 30, 1979, a Cathay Pacific flight landed at Tokyo Haneda Airport.

As Chen Bingwen stepped out of the cabin, a biting cold wind rushed towards him, carrying a dry chill unlike that of Hong Kong Island.

He was followed by Ling Peiyi, Zhao Gang, Li Ming, and two key members of the marketing department.

The group wrapped themselves tightly in their coats and quickly passed through customs.

"Mr. Chen, Suntory has sent a car to pick us up and take us directly to their headquarters," Ling Peiyi reported in a low voice, her breath quickly dissipating in the cold air.

She was holding a folder containing information that Li Ming had compiled in advance, including Suntory's publicly released channel information and an analysis of the Japanese beverage market.

Chen Bingwen nodded, his gaze sweeping over the bustling scene outside the airport.

Tokyo in 1979 was already a city of towering buildings and bustling traffic, far more modern than Hong Kong Island at that time.

The iconic brown bottle logo of Lipovitan is prominently displayed on the huge billboards, a reminder that he is about to enter a mature and highly competitive market.

The success of Pulse in Singapore was due to the popularity of "Drunken Master" and Jackie Chan's explosive popularity. It quickly ignited the market by relying on bundled marketing and localized flavors.

Other Southeast Asian countries can replicate the Singapore model by relying on franchised bottling plants and distributors to cultivate the market.

But Japan is different.

This is one of the world's most mature and discerning consumer markets.

Consumers have high brand loyalty, unique and stubborn taste preferences, and strong channel barriers.

Suntory, Kirin, Asahi, Shiseido, and other domestic giants have formed a complex and intertwined business structure.

International brands like Coca-Cola and Nestlé also have to be careful here and follow local rules.

More importantly, this is the "groundbreaking point" for energy drinks.

Lipovitan dominates the fatigue relief market with its "small bottle of medicine-like" products. Although Pocari Sweat has not yet been launched, its "electrolyte hydration" concept is the key to disrupting the market in the next few years.

Chen Bingwen clearly remembers that Pocari Sweat would emerge in 1980, leveraging Otsuka Pharmaceutical's pharmaceutical background and the concept of "drinking drips" to quickly open up a new blue ocean for sports drinks.

For "Pulse" to establish itself here, relying solely on the "movie-bundled + free drink promotion" model from Singapore is far from enough.

It needs more precise positioning, stronger channel support, packaging and taste that better suit the aesthetics of Japanese consumers, and faster speed.

Before Pocari Sweat hits the market, it must firmly establish in the minds of Japanese consumers the dual functions of "energy boost" and "hydration during exercise + energy boost"!

Seize the mental space that is about to be defined by Pocari Sweat as "sports hydration"!
The window of opportunity is less than a year and a half.

This is why Chen Bingwen had to personally lead the team to Tokyo.

Li Ming had previously reported that he and Suntory had initially finalized a distribution plan for 500 core stores, but Chen Bingwen believed that this was far from enough.

500 stores?

A drop in the ocean!

In his memory, Suntory's beverage distribution network was already a behemoth at this time.

Its self-operated and joint-venture vending machines alone number over 28!

Convenience stores, gas stations, large supermarkets, and catering channels—this network covers almost every inhabited corner of Japan.

A mere 500 points are like throwing a pebble into the ocean; they won't even make a splash.

This is far from reaching the tipping point to ignite the market, and it is even less likely to create sufficient brand barriers before Pocari Sweat goes public.

500?
This number is not even a fraction of Suntory's true channel potential.

They are treating "Pulse," a strategic product, with the same attitude they would use for any other new product.

He needs everything!
It is thanks to Suntory's strength that "Pulse" can appear at every key point where Japanese consumers might buy beverages in the shortest time and with the highest density!

“The Japanese market is completely different from the Singapore and Southeast Asian markets,” Chen Bingwen said to Ling Peiyi and Li Ming beside him, his voice low but carrying a hint of seriousness.

Previously, both Ling Peiyi and Li Ming attached great importance to developing the Japanese market, but subconsciously they may still have regarded Japan as a larger and richer "Singapore".

They believe that with improved products, Cheng Long's star power, and Suntory's channel support, replicating the success in Southeast Asia will not be difficult.

Li Ming even felt that getting Suntory's 500 core stores as a trial was already a good start, and that they could slowly negotiate and gradually expand.

In Chen Bingwen's view, this idea was a fatal underestimation of the enemy.

Japan is not a larger version of Singapore.

It is a battlefield in another dimension.

Therefore,
He had to come in person and use the most direct method to reverse this potential cognitive bias within the team.

Let everyone understand – Japan is not another Singapore.

It is a strategic high ground that we must devote all our efforts to and bet heavily on; it is a crucial battle for whether Chenji's globalization dream can be realized.

"If we lose to Japan, all our previous successes will be greatly diminished."

Inside the black Toyota Century sedan, the heater silently provided warmth, keeping out the cold outside.

Chen Bingwen's words brought a brief silence to the carriage.

Ling Peiyi and Li Ming straightened their expressions. They could hear an unprecedented seriousness in Chen Bingwen's calm tone.

Suntory headquarters building, top floor conference room.

The air carried a faint smell of disinfectant, mixed with the aroma of light tea.

Outside the huge floor-to-ceiling windows, the view of Tokyo Bay appears both stark and bustling under the winter sun.

Chen Bingwen and his entourage entered the conference room under the guidance of the reception staff.

Suntory's International Business Head, Ichiro Tanaka, was already waiting, with Channel Director Masao Kobayashi and Legal Advisor Takeru Satoh sitting beside him.

"Mr. Chen, welcome to Suntory." Tanaka Ichiro stood up, bowed slightly, and wore a formulaic smile.

"Mr. Tanaka, Mr. Kobayashi, Mr. Sato, it's a pleasure to meet you." Chen Bingwen returned the greetings, his expression calm.

Both parties took their seats.

After a brief exchange of pleasantries, Tanaka Ichiro got to the point: "Mr. Chen, our technical department has conducted a preliminary evaluation of your company's 'Pulse' functional beverage samples."

It has a unique flavor and a remarkable energizing effect.

We acknowledge its market potential.

He paused, then looked at Masao Kobayashi: "Director Kobayashi is in charge of our company's omnichannel management."

Please have Mr. Kobayashi explain to Mr. Chen regarding the distribution plans for 'Pulse' and your company's bottled sugar water in the Japanese market.

Masao Kobayashi adjusted his glasses and opened the document in front of him: "Mr. Chen, based on our cooperation agreement and our understanding of the Japanese market, we have initially planned as follows:

In the first phase, which is the first month after the product launch, we will select 500 high-quality retail stores in the core business districts of the three major metropolitan areas of Tokyo, Osaka, and Nagoya for trial sales.

The store types include: 30 large supermarkets, 100 convenience store chain flagship stores, 20 high-end department store food counters, and 350 selected community convenience stores.

Distribution standards: Each store must ensure that at least 100 bottles of 'Pulse' and 100 bottles of bottled sweet soup (half mango pomelo sago and half coconut milk sago) are displayed in a prominent position in the refrigerated display case.

In the second phase, based on the first month's sales data and market feedback, the expansion will gradually extend to other regions and more retail outlets. It is projected that the number of covered stores will reach 1500 within three months.

Masao Kobayashi spoke at a steady pace and with clear logic. He added, "At the same time, we will simultaneously launch a two-week consumer tasting event at the aforementioned 500 stores and distribute the first batch of promotional materials."

This is a standard procedure for risk control during new product introduction.

Chen Bingwen listened quietly, his face expressionless.

He picked up the teacup in front of him, gently blew away the foam, took a sip, and put the cup down.

"500 stores?" Chen Bingwen's voice wasn't loud, but the Suntory staff could hear the dissatisfaction in it. "Mr. Kobayashi, is this Suntory's sincerity towards its strategic partners?"

Masao Kobayashi frowned almost imperceptibly: "Mr. Chen, the initial stocking volume of 500 core stores is already a high standard during the introduction period of similar new products."

Japanese consumers need to be taught to accept new brands, and blindly expanding distribution could lead to inventory buildup and damage to channel confidence.

This is a professional judgment based on market principles.

“Market rules?” Chen Bingwen shook his head slightly, then turned his gaze to Tanaka Ichiro. “Mr. Tanaka, let’s first review the basis of our cooperation.”

He leaned forward slightly, looking directly at Tanaka Ichiro: "Chen's collaboration with Suntory began with the licensing of the diamond-shaped anti-slip bottle cap patent."

Suntory paid a base licensing fee of $20 and promised to pay a commission of 0.025 cents for every bottle cap used.

More importantly, as part of the exchange, Suntory promised to open up its core distribution channels in Japan to Chen Kee products, providing priority access support.

He paused, then emphasized, "Please note, Mr. Tanaka, when I say 'open channels,' I am not referring to a trial run with 500 stores, much less a conservative strategy of 'gradually expanding based on sales data.'"

Rather, it means that Suntory should leverage its nationwide, deeply integrated distribution network to provide "Pulse" and bottled sugary drinks with the same level of distribution support and channel promotion resources as Suntory's own core products!

Masao Kobayashi couldn't help but speak up: "Mr. Chen, channel resources are limited."

Suntory has a wide range of products, and the introduction of each new product requires careful consideration.

Chen Bingwen raised his hand to interrupt him, his gaze still fixed on Tanaka Ichiro: "Mr. Tanaka, we both know the value of the bottle cap patent."

It solves a pain point that has plagued the glass bottle beverage industry for decades, significantly improving user experience and brand favorability.

Chenji did not choose to exclusively license this patent to Coca-Cola or Pepsi, but instead licensed it to Suntory.

why?
Because we value Suntory's local advantages and distribution channels in the Japanese market, we are looking for deep strategic collaboration, not just a simple patent sale.

He leaned back in his chair, softened his tone, and said solemnly, "If Suntory's understanding of 'priority access support' is merely a trial sale in 500 stores, then I believe that our understanding of 'strategic synergy' is seriously flawed."

This is unlikely to match the long-term value and competitive advantage that Suntory's bottle cap patent brings.

Tanaka Ichiro's smile vanished. He remained silent for a moment before slowly speaking, "Mr. Chen, I understand your request."

But Director Kobayashi's concerns are not unreasonable.

The Japanese market environment is complex, and consumers are particularly cautious about new brands.

Distributing the product to 500 core stores, combined with tasting and promotion, is the best solution with controllable risks and measurable results.

Suntory needs to be responsible to its channel partners, and also to the long-term reputation of Chen Kee products.

(End of this chapter)