Skyrocketing prices, Moutai "reduces fiefdoms"

Asking AI · How does the price increase of Moutai accelerate dealer clearance?

(This article is authored by Super Focus, published with Titanium Media’s authorization)

Text | Super Focus

Moutai is about to “cut” its dealers.

On March 30, Guizhou Moutai announced an increase in the ex-factory price of Feitian Moutai (2026 edition). Among them, the ex-factory price of Feitian Moutai increased by about 8.6%, from 1,169 yuan per bottle to 1,269 yuan per bottle; the suggested retail price through direct sales channels was raised from 1,499 yuan to 1,539 yuan per bottle, an increase of about 2.7%. Effective immediately from March 31, 2026.

According to The Wall Street Journal, two major Wall Street investment banks quickly responded, calling this a key milestone in Moutai’s market-oriented transformation: Goldman Sachs stated in its latest research report: “This is another key milestone in Moutai’s transition to a more market-based pricing system,” covering direct sales, wholesale, and agency sales models, and adjusting prices based on market dynamics; Morgan Stanley pointed out that this price hike “reflects Moutai’s judgment of actual demand for Feitian, especially after the launch of the iMoutai platform.”

So, after two and a half years, why is Moutai raising prices amid a generally weak market? What are its calculations?

01 A Long-Planned Targeted Strike

Foreign investment banks frame Moutai’s price adjustment as a “milestone in moving towards marketization,” but from the perspective of domestic business logic, this is essentially a precise “dismantling of power.”

To put it plainly, this is a typical targeted attack initiated by Moutai (primary market) against channel players like distributors (secondary market).

Many voices believe that Moutai’s choice to raise prices now is because the Spring Festival has just passed and Labor Day is not yet here, placing it in the traditional off-season for white wine consumption. At this timing, the bargaining power of distributors is weakest, and adjusting the pricing system faces the least resistance and side effects, making the outcome most favorable for the brand owner.

This is certainly true, but in the grand scheme of “dismantling power,” the timing of the action is just superficial. The real key is how to play this big game.

Looking at the longer timeline, Moutai’s actions since the end of 2025 have already laid the groundwork.

On December 28 last year, at a dealer symposium, Moutai executives publicly stated they would “respect market laws, follow market trends, and reduce market speculation.” Then, on January 1, 2026, the iMoutai mini-program began directly selling Feitian Moutai to consumers at 1,499 yuan.

The official stance is clear: they want to vigorously develop the direct sales system, reclaim profits that had previously been lost in dealer channels and secondary markets. Therefore, this simultaneous increase in ex-factory and retail prices is just one part of the overall strategic plan.

Moutai is attempting to reconstruct the pricing system from the source, exerting pressure, sharply compressing channel profits, and covertly forcing those unable to withstand the pressure to exit, gradually dismantling the old “factory-bundled” model.

The reason is that baijiu is a product with a very strong regional attribute—powerful local players are hard to suppress. To penetrate and dominate the national market, high-end baijiu must do more than just spend money on advertising; the core is to cultivate a large distribution network. This requires active cooperation from local distributors, who accept factory allocations and stockpiling, using real money to store liquor in their warehouses.

So, the question is, why would anyone be willing to turn hundreds of millions of yuan into inventory? The answer lies in Moutai’s unique “financial attribute.”

Take Feitian as an example. For a long time, its ex-factory price was just over 900 yuan, but the actual transaction price at the terminal often reached two or three thousand yuan. The huge price difference and visible “appreciation potential” are the main drivers for distributors to stockpile and buy in bulk.

This was once a perfect win-win situation. Distributors chased profits, willingly helping Moutai distribute its products nationwide; at the same time, once their liquidity was fully occupied by Moutai, they couldn’t afford to invest in other competing brands. This covert “exclusivity” became the best moat for Moutai.

But in recent years, the fundamental situation has changed dramatically.

Since 2021, as the real estate industry entered a correction period, local land finance shrank, and construction projects sharply declined, directly hitting the demand for high-end business banquets. As Feitian is a “hard currency” for gift-giving and social gatherings, its actual opening rate plummeted. This is also why in 2022, Moutai tried to venture into ice cream and test the mass consumer track, though it didn’t make much splash later.

The cold wind of terminal consumption inevitably blows upstream to distributors.

After resisting inertia for two years, the wholesale price of Feitian in the circulation market finally couldn’t hold in 2024 and fell rapidly. By the end of 2025, the wholesale price of a case of Feitian was about to fall below the official guide price of 1,499 yuan.

This means that the “financial appreciation myth” that long supported the long-term alliance between manufacturers and distributors has actually been shattered.

The harsher truth is that the cost for distributors is not just the nominal ex-factory price. In practice, to get good-selling Feitian Moutai, distributors must accept “bundling,” purchasing other less-sellable series of liquor along with it.

Adding these bundling costs, plus the business and sales costs at each middle stage, the true breakeven point for a bottle of Feitian Moutai is roughly around 1,700 to 1,800 yuan.

In other words, before the wholesale price in the secondary market drops below 1,500 yuan, a large number of distributors holding inventory are already in “floating loss,” and it’s hard to find buyers.

Understanding this environment, looking back at Moutai’s price adjustment, it becomes clear that this is ultimately a “brutal game of ‘factory crossing the river and stabbing the channel’.”

When the channel can’t sell due to falling prices and no profit, Moutai, as the boss, not only refuses to rescue the market but also moves to the front line, squeezing out the last bit of terminal profit to ensure its listed company’s performance remains impressive.

Simply put, the channel and speculators’ livelihoods are about to run out, and Moutai not only refuses to add to the “meal,” but also takes the pot back home. As for whether distributors will go hungry, it no longer concerns them.

Imagine if the official didn’t intervene to rescue the market but instead flooded the terminals with direct sales at original prices—this would be a fatal blow to traditional channels. Since official channels are cheap and genuine, middlemen holding stock would have no choice but to drastically cut prices to make up for “trust discount.”

Regarding the specific figures of this price adjustment: the official retail price rose from 1,499 to 1,539, just a token move to keep up with inflation; but the real killer is that the purchase price for distributors jumped from 1,169 to 1,269, a full increase of 100 yuan.

A 100 yuan increase in purchase price, with only a 40 yuan rise in the suggested retail price, what does this imply?

It means that for each bottle sold by distributors, Moutai is squeezing an extra 60 yuan in profit. Under the guise of “price adjustment,” it’s actually the official further squeezing the survival space of channels, forcing weak distributors out with razor-thin margins.

Business rules have always been like this. When middlemen can no longer cover their risks with their earnings, the manufacturer’s direct control becomes just a matter of time and the right approach. And Moutai has made a decision that is most responsible for capital, yet the coldest and most ruthless.

02 Face must not allow “price cuts”

Moutai’s “dismantling of power” explains “who it’s targeting.” But in the current environment of a sluggish overall market and high inventory in the baijiu industry, the conventional approach for consumer goods is to lower prices for promotion and clearance. So why does Moutai dare to go against the trend, not only refusing to lower prices but actually raising them?

If you see Feitian Moutai as just a simple bottle of white liquor, this move is purely suicidal. But if you shift perspective and see it as a “luxury item,” this logic becomes entirely plausible and even very clever.

In the luxury goods world, there is a counterintuitive classic strategy: “raising prices to clear inventory.”

Feitian Moutai is no longer an ordinary consumer product. Although sales have been under pressure in recent years, it remains the only unicorn in the baijiu industry, a social symbol that has been elevated to a divine status.

Everyone is not stupid—when consumers spend a thousand or two thousand yuan on a bottle, they are not just buying the liquor inside; they are buying the “emotional value” it confers. Out of the 1,500 yuan, only a few hundred are for the liquor itself; the rest is for face, status, and showing respect to guests.

This emotional value is built on the expectation that “price will always be firm, even rising.”

Therefore, for Moutai, maintaining high prices for its flagship products allows the myth to continue; but if one day the official price drops or even just stops rising for a long time, it would be a catastrophic collapse for the brand image. Consumers would think “Moutai is just so-so,” and the “face value” would depreciate. The rigid demand for gifts and banquets would be greatly reduced.

This is why Moutai is willing to raise prices despite market cooling, but refuses to lower them to stabilize the market. Raising prices is a reaffirmation of its luxury positioning, while “dismantling power” is just a means to stabilize profits during price fluctuations.

Moreover, Moutai is confident in doing this because of its extremely restrained brand protection strategy.

Once, Wuliangye, which could compete with Moutai at the high end, later diluted its scarcity by aggressively licensing and developing dozens or hundreds of variants, diluting the main brand’s exclusivity.

In contrast, Moutai is very protective of its reputation. Although it also develops other products, it rarely allows the use of core “Moutai” branding. The products that generate over 98% of profits and revenue are still the few flagship series tightly guarded in the core circle (Feitian, Yingbin, Prince, Hansoj, 1935, etc.).

Because the core brands are not overexploited, Moutai’s pricing power remains firmly in its own hands.

A more practical point is that the target consumers of Feitian Moutai are not sensitive to a few dozen yuan increase.

“Now, the baijiu market is clearly stratified. Ordinary folks drink cheap grain liquor for a few tens of yuan; friends’ gatherings cost two or three hundred yuan; some business occasions might push six or seven hundred yuan to impress. Feitian Moutai now costs over 1,500 yuan, mostly for graduation banquets and housewarming or wedding celebrations.”

Sales expert Tao Lingfeng believes that for bosses who need a bottle of Moutai to get things done or sign big deals, whether it’s 1,500 or 1,539 yuan per bottle makes almost no difference. As long as the bottle can impress at the table, they don’t care about a few yuan difference.

In contrast, if a bottle of Erguotou from Niulanshan suddenly increased by ten yuan, its core audience might immediately switch brands.

Therefore, the slight retail price increase in this price adjustment has almost no resistance for genuine end consumers. The only group truly suffering from this price hike, as mentioned in Part 1, are the dealers and wine speculators holding large inventories and facing liquidity issues.

This is the brilliance of Moutai’s move—killing two birds with one stone:

Internally, by raising the ex-factory price sharply, it severely compresses channel profits, accelerating dealer “dismantling” and clearance; externally, by guiding the terminal retail price upward, it continues to uphold the high-end myth of “luxury price hikes to clear inventory,” preserving the brand’s emotional value.

In the overall shrinking baijiu market, as long as Moutai remains firmly in the unicorn position without reckless moves, and plays out this game of primary and secondary markets and luxury control, it will still be that profitable “sauce aroma tech.”