Entire China s dairy industry stock price rises, Mengniu performs exceptionally well

On April 28th, Mengniu Dairy Group relaesed its 2009 annual report. The data showed that the sales revune of Mengniu in 2009 reached RMB 25.71 billion with 7.7% of growth rate, and the production volume reached 5.76 million tons, both of which made Mengniu again the champion dairy company in 2009. Meanwhile, Mengniu ranked No.19 among world s top 20 dair y companies on behalf of the whole Chinese dairy industry which entiled Chinese dairy industry the actual fastest growth dairy market in the world and the third largest dairy production country of the globe. There were two things that attracted worldwide attention which were: good growth and large potential development.
According to National Bureau of Statistics of China, Mengniu Dairy Group won the champion of Chinese market in terms of both sales volume and revenue in 2009. According to statistics from China General Chamber of Commerce released in March of 2010, it showed that the liquid milk of Mengniu got the champion of Chinese market share. As the three consecutive champion of Chinese dairy industry, Mengniu s development was worthwhile to pay attention to and be analyzed.
Green development strategy reinforced the foundation of Mengniu and green gold model gained great advantage
As a worldwide influential dairy brand, Mengniu has already paved the way for its green gold development mode. Dairy industry originally advocates grass planting, grassland and ecological protection, and Mengniu s final goal is to develop ecological industry, grassland and realize green gold development model so as to provide natural, green and healthy product, Said relevant persons of Mengniu.
Serving at this target, in January of 2008, Mengniu invested RMB 45 million to build the world s largest biogas power plant at Shengle Economic Development Zone of Hegineer County. As the counterpart facility of Austasia International Dairy Farm, this power plant is capable of producing 10 million KWH of electricity by utilizing cow manure and urine. Regarding the scale of economy and economic benefit, this power plant is the No.1 in the world. However, as the national leading dairy enterprise, Mengniu has been leading the way to front in the tidal wave of green economy, Said relevant persons from the United Nations Development Program.
In the past, relying on the green ecology concept, Mengniu won the Award of China Low Carbon Pioneer Enterprise of this year which also demonstrated from the other angle that Mengniu s green gold philosophy had already gained wide recognitions.
Through many years efforts made to ecological industry, Mengniu s green philosophy development foundation is solidly laid. Under the era of green economy, today, only the green model can become the sharp weapon for the company to develop well. Represented by Mengniu, a group of Chinese enterprises have cultivated their ability of fast innovation, Said a senior dairy expert.
Technology innovation supports ecological industry and Mengniu concentrates on milk supply construction and product research and development
If ecological industry is the steering wheel of an enterprise, the technology is the engine. Economist Joseph Alois Schumpeter thought that the key to a company s development is the market, and a company should continue to develop right products to meet the market demands relying on developing technology. Therefore, besides system construction, the technological innovation should be emphasized.
For dairy enterprises, raw milk supply is the key issue. Mengniu has invested a lot on dairy farm constrution and achieved great favorable position on milk supply. In 2005, Mengniu s Austasia International Dairy Farm was inaugurated at the 40 north latitude where located the world s gold grassland belt and the world s first ever four model milking machine and milking robot was introduced here. It is known that Mengniu Dairy Group has cooperatively built 11 dairy farms with each holding capacity of over 10,000 herds nationwide. At present, the raw milk from modern farm and communities takes the majority of the whole milk supply.
With good source milk, Mengniu invested RMB 1.2 billion to build the domestic largest high-tech dairy research and development institute. This institute on average claimed one patent every 9 days and launched one new product every 6 days. The institute collected intellects from Cambridge University, Monash University, Chinese Academy of Science, Agricultural University of China and other 16 domestic and overseas institutions. With internal R&D departments of Mengniu, these intellectuals formed a completely advanced R&D chain. Mengniu never neglected investment on product research and development. Under fierce market competition, only when we focus on providing consumers with good products, can we survive and gain the strength for sustainable development, said responsible person of Mengniu s R&D Institute.

Meticulous management mode pushed Mengniu s iron army to become the industry leader
Haier s CEO ZhangRuimin once said that low requirement and non-strict regulations can easily bring an enterprise about lower competitiveness, and if a company wanted to participate in the international competition, it must strengthen internal management to make great efforts to resource consolidation and competitiveness construction. If everybody seems to get along with each other well and everything seemingly goes well, but the company goes bankrupt, then the care to employees becomes a hollow sentence. As a fast developing company, meticulous management is quite important for Mengniu Dairy Group.
The prominent part of Mengniu s management system is on site management, target responsibility and whole staff quality management system. Menginu s plant, workshop, and even the toilet is quite clean, all these should attributes to strict on-site management. How can a person succeed if he doesn t even want to sweep his room? is the requirement for hygienic on-site management. Mengniu adopts position target responsibility system to have people s commitment, power and right clearly set, and staff s remuneration completely depends on system execution, process and the target achievement. Mengniu strictly implements the overall staff quality management system which requires everybody to place the sense of quality to the first.
At present, Mengniu Dairy Group has already formed its own featured management mode, and this is exactly the assurance of the company s sustainable development. From daily conclusion to daily improvement, to openness, fairness and justified encouragement system, meticulous management not only made Mengiu efficient but also greatly cut the cost, and meanwhile, Mengniu s employees remuneration ranked highly in the industry.