Moutai penalizes dealers, ends two contracts amid supply crunch

Updated 2017-08-23 10:00:18 Global Times

Leading domestic distiller Kweichow Moutai Co on Monday penalized 54 dealers, two of which had their contracts terminated, domestic news website reported on Tuesday.

The dealers, Shanghai-based Xinfuminghang International Trade and Yulin Xinfulong Commercial Trading Co in Northwest China's Shaanxi Province, have seriously hurt consumers' interests and damaged the liquor brand's image despite Moutai's repeated demands, according to a document released by the company on Monday night as saying.

Also, the two dealers' distribution and sales models breached the terms of their contracts and disrupted market order, which prompted Moutai to cease dealing with them and confiscate their performance bonds, said the report. The contracts won't be renewed next year.

The other 52 dealers had such problems as substandard management of franchise stores, lack of promotional campaigns for holidays, and inability to provide complete sales records, the Securities Times reported on Tuesday.

Moutai has issued statements in recent years dealing with penalties for dealers who violate contract terms, but this is the first time the company has formally terminated any contracts. The move reflects the company's determination to stabilize prices and ensure market supply ahead of the National Day and Mid-Autumn holidays, which are traditional peak periods for demand.

Some Moutai retailers have run out of stock while others have imposed purchase limits, the Beijing Youth Daily reported on Monday. In some extreme cases, dealers have taken advantage of the supply crunch and added several hundred yuan to the market price.

"The supply shortage has become a norm in the market, so we need to strengthen supervision and crack down on scalpers," Moutai's general manager Li Baofang said at the company's mid-year work meeting on Monday.

Moutai's online e-commerce platform started to sell a Feitian brand on Monday.

Also in the News

Nicole Kidman Recalls Oscar Glory: Loneliest Time
Showbiz2016/06/16 13:58October 22 2018 05:58:48

Nicole Kidman Recalls Oscar Glory: Loneliest Time

Attending Shanghai International Film Festival, Nicole Kidman talks about her role in "Grace of Monaco".

Labor Day Travel Peak Starts
Also in the News2014/05/01 12:16October 22 2018 05:58:48

Labor Day Travel Peak Starts

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'
Also in the News2014/04/18 13:18October 22 2018 05:58:48

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'

Hollywood star Johnny Depp's speech in the upcoming new film "Transcendence" has been disclosed on Friday, April 11th.

China World Business Sports Showbiz Audio
C4 My Chinese Life The Sound Stage China Revealed Showbiz Video Travel Video
China World Fun Travel Entertainment Sports
Beijing Shanghai Guangzhou
Live Music Opera & Classical Movies Traditional Shows Exhibitions
Learn Chinese:
Chinese Studio Living Chinese Everyday Chinese Just For Fun Chinese Culture Buzzwords