World Grain - February 2019 - 32

FEATURE: WUDELI MAKES GOOD ON PROMISE

Dan Zhimin, chairman of Wudeli,
has helped guide
the company to
unprecedented
expansion over
the last decade.

tonnes net. The company still accepts direct delivery
from farmers as well, even when transported in bags,
which has become rare.
Dan said almost all wheat farmers, however small,
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household consumption year-round. The north China
plain is densely populated and staple foods like buns
and noodles are wheat-based. Thus, the wheat zone is
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short distances on good roads, keeping costs and prices down.
Stable wheat prices resulting from predictable government purchases make business planning easier.
China's state grain agency, Sinograin, buys a large part
of the harvest at a minimum support price in order to
guarantee farmer incomes. The 2019 price is 2,240
50%86
The government's large wheat reserves are rotated
via regular auctions with an average price of 2,500
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domestic market price.
Wudeli sends staff to take samples from the local
storages owned or leased by the government grain
RUJDQL]DWLRQV%LGVDUHSODFHGRQOLQH3D\PHQWLVLPmediate. At times the government wheat may be three
years old, but Wudeli's technicians can manage it.

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per-day mill in Daming, for example, has storage for
90,000 tonnes, just one month of inventory.
SALES AND MARKETING
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Wudeli brand, which has become a household name
in many parts of China. The brand encompasses the
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in protein levels, ash content and functionality to meet
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steamed bun makers as well as western-style bakeries
and households.
Wudeli Group consists of subsidiary companies by
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all orders from the 2,000 wholesale distributors that account for 80% of turnover. Some customers send their
own trucks to the mill gate, but independent trucking
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to distributor warehouses. Thus, the lack of need for
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Dan estimated a 50% market share
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25% share in Shanghai, China's two
largest cities.
MANAGEMENT UPGRADES
Dan said the ambitious implemenWDWLRQ RI 6$3 HQWHUSULVH UHVRXUFH
planning software in July 2017 has
heightened management capability
for sales as well as inventory and
processing operations.
Wudeli's managers also cited the
decision-making authority given to
plant directors as a reason for superior results. The top person in each
mill takes sole responsibility for its
operations. This contrasts with the
majority of state-run enterprises
where most decisions are taken by
committee, slowing response time
and diffusing accountability.
WUDELI'S COMPETITION
Two other major agribusiness com-

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World Grain - February 2019

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