Yellow rice wine has suddenly become a huge hit: for this RMB 21 billion niche market, why are distributors the first to set their sights on it?

A type of alcoholic beverage that has long been confined to the dining tables of Jiangsu, Zhejiang and Shanghai has suddenly become a "new business opportunity" in the eyes of channel distributors recently.

Since September, the rice wine index has risen by 55.78%, with enterprises such as Kuaijishan and Guyue Longshan posting markedly strong performance. However, the lively stock price is only a superficial phenomenon. What is truly worth observing is the moves of offline channels: a group of distributors who mainly sold Baijiu in the past are signing contracts with rice wine enterprises to help them enter markets in Northeast, North, Central, Southwest China and other regions.

Problems have also emerged accordingly: for a category with total national sales revenue of around 21 billion yuan and consumption highly concentrated in Jiangsu, Zhejiang and Shanghai, why has it suddenly regained the favor of alcohol distributors?

The answer is not that "rice wine has become popular across the country overnight". Instead, when traditional alcohol channels are looking for new profit sources, rice wine provides an alternative category that features a moderate scale, concentrated brands, and still adjustable price ranges.

Nevertheless, the willingness of channels to enter the market only proves that there are people who will stock the products. Whether consumers are willing to repurchase after drinking the rice wine will determine how far this round of popularity can go.

How Large Is the RMB 21 Billion Market? The Answer Is Clear When Placed in the Alcohol Beverage Market

Rice wine has a very long history, but its business scale is not large.

Data disclosed by the China Alcoholic Drinks Association shows that in 2023, the total sales revenue of national rice wine production enterprises was about 21 billion yuan, of which the sales revenue of rice wine enterprises above designated size reached 8.547 billion yuan. Compared with the Baijiu market that boasts a scale of hundreds of billions of yuan, rice wine is still a relatively niche category.

Moreover, the 21 billion yuan is not the revenue of listed rice wine companies, nor the retail market transaction volume of a specific year, let alone the profit pool that enterprises can directly divide. It reflects the industry-caliber sales revenue of national rice wine production enterprises.

Rice wine also has a prominent feature: its consumption regions are extremely concentrated.

In Jiangsu, Zhejiang and Shanghai, rice wine can be found on family dining tables, festival banquets and in daily cooking, so consumers do not need to take a "rice wine knowledge course" before consuming it. But outside its traditional markets, many people's impression of rice wine still stays at "used for cooking", "served warm in winter" or "alcohol for elders".

This has formed an interesting contrast:

Rice wine is not short of history or cultural stories. What it lacks is stable and repeated bottle-opening behavior from consumers across the country.

For enterprises, a small market scale is not necessarily a bad thing. A small market means that the development space may not have been fully opened up, and it also means that more money and time need to be invested in consumer education.

By entering the market at this moment, channel distributors are betting exactly on whether the latter can be converted into the former.

Why Are Baijiu Distributors Starting to Sell Rice Wine?

Alcohol distribution is a business that highly relies on channel density.

A mature Baijiu distributor may have resources covering supermarkets, tobacco and liquor stores, catering outlets, group purchase clients and wedding banquets. In the past, Baijiu enjoyed fast sales, so this network mainly served Baijiu brands. When the market enters an adjustment period, some distributors will look for new products that can be placed in existing channels.

Rice wine happens to meet several relevant conditions.

First, the product is differentiated. Instead of adding another Baijiu brand with similar flavors, it can supplement consumption scenarios such as low-alcohol beverages, catering-specific drinks and traditional cultural alcohol.

Second, the supply is relatively concentrated. Although the rice wine industry is small in scale, leading brands have already formed certain public recognition, so distributors do not need to explain the product from scratch.

Third, the price structure still has room for adjustment. Rice wine used to be perceived as a relatively affordable product. If enterprises can launch products more suitable for banquets, gifting and young consumers, distributors will have the opportunity to access new price ranges and profit space.

Fourth, the channels can be partially reused. The existing tobacco and liquor stores, catering terminals and group purchase resources do not need to be built from zero.

In plain terms, what attracts alcohol distributors is not just a bottle of rice wine, but whether their warehouses, sales teams and client networks can support an additional business line.

This calculation is very realistic for channel distributors: adding a new category does not require a significant increase in rent and manpower, but can increase the sales revenue of each store, so it is certainly worth a try.

However, reusing channels also has boundaries. Baijiu channels can put rice wine on shelves, but cannot automatically make consumers in northern China form the habit of drinking rice wine. In the past, Baijiu sales relied on banquets, gifting and business consumption. After switching to rice wine, the consumption reasons, drinking methods and matching dishes all need to be re-established.

With 76.59% Growth, Don't Rush to Claim "Successful National Expansion"

The non-local revenue data of Kuaijishan is one of the most concerned evidences in this round of rice wine popularity.

In the first half of 2026, Kuaijishan's sales revenue in regions outside Jiangsu, Zhejiang and Shanghai reached about 134 million yuan, a year-on-year increase of 76.59%; revenue in Shanghai increased by 20.95% year on year, and revenue in Jiangsu increased by 7.48% year on year. Meanwhile, its revenue in the Zhejiang region was about 467 million yuan, a year-on-year decrease of 9.85%. The 76.59% growth rate is very impressive, but it should be viewed together with the low base figure.

Although revenue from regions outside Jiangsu, Zhejiang and Shanghai is growing rapidly, it still only accounts for about 16% of the company's total alcohol sales revenue. The revenue from Zhejiang region alone is still more than 3 times the total revenue of all other non-local markets.

This indicates two things are happening at the same time:

On one hand, non-local markets are indeed being opened up, and cross-regional expansion is no longer just a goal written in the corporate plan. On the other hand, the company's reliance on traditional markets has not undergone fundamental changes, and the national expansion is still in the foundation-laying stage.

What is more noteworthy is the channel structure. In the first half of the year, Kuaijishan's wholesale and agency revenue was about 657 million yuan, a year-on-year increase of 2.12%; direct sales and group purchase revenue was about 165 million yuan, a year-on-year increase of 18.45%. This set of data reminds us: the rapid growth in some non-local markets does not mean that all distribution channels have achieved full sales growth. Regional growth, investment attraction and contract signing, distributors making payments for goods, terminal sales and consumers opening the bottles are five completely different links.

Getting the alcohol into distributors' warehouses is called "shipment"; placing it in restaurants and tobacco & liquor stores is called "stocking"; being purchased by consumers is called "fast-moving sales"; and repurchase after drinking is the real "repeat purchase".

What the market truly wants to see is obviously the last step.

For Rice Wine Nationalization, the Hardest Part Is Not Driving Out of Zhejiang Province

Alcohol enterprises often encounter a misunderstanding in their expansion: there are many blank areas on the map, which seem to bring incremental growth everywhere.

But the absence of sales does not necessarily mean that the market is waiting to be developed. It may also mean that local consumers do not have stable demand for the product for the time being.

To go national, rice wine needs to cross at least three thresholds.

The first threshold is taste. Preferences for sweetness, alcohol content and drinking temperature vary in different regions. The flavor familiar to consumers in Jiangsu, Zhejiang and Shanghai may not naturally fit consumers in other cities.

The second threshold is scenario. Why would consumers buy a bottle of rice wine in addition to Baijiu, beer, wine and pre-mixed cocktails? Is it for food pairing, solo drinking, gifting, or the light intoxication experience pursued by young people? If the scenario is vague, the product will easily become a "cultural exhibit" on the shelf.

The third threshold is inventory turnover. Alcohol distributors fear most that their goods are piled up in the warehouse. The first batch of stock can be driven by investment promotion policies, but the second batch of orders must rely on terminal sales. If the inventory turnover is slow, channel enthusiasm will cool down earlier than consumer enthusiasm.

This is why in recent years, rice wine enterprises have not only emphasized channel stocking, but also made product adjustments: increasing the proportion of mid-to-high-end products, launching low-alcohol or sparkling rice wine products, and adjusting packaging and drinking methods.

In the first half of the year, Kuaijishan's sales revenue of mid-to-high-end rice wine reached about 595 million yuan, a year-on-year increase of 14.17%; revenue of ordinary rice wine was about 148 million yuan, a year-on-year decrease of 24.02%. This is not simply "the more expensive the better". Instead, it shows that the enterprise is trying to get rid of the old competition model that only relies on low prices and traditional regional markets.

The problem is that premiumization can increase the revenue per bottle, but cannot replace the consumption base. Younger packaging does not mean that young people will buy the product in the long run; distributors' willingness to purchase the first batch of goods does not mean that the terminal can sell out smoothly.

To Judge Whether Rice Wine Is Truly Popular, Look at These 5 Indicators

Ordinary consumers do not have to conclude that a rice wine consumption boom will soon emerge around them just because rice wine stocks are rising. The capital market trades on future expectations, channel distributors trade on product price differences, while consumers purchase based on taste, scenario and experience. The three are not synchronized.

To judge whether this business has truly expanded beyond Jiangsu, Zhejiang and Shanghai, we can refer to five indicators:

Non-local revenue proportion: we should not only look at the growth rate, but also look at its proportion in the total revenue;

Repeated orders: whether newly signed distributors place the second and third restocking orders;

Inventory turnover: whether the products are in the hands of consumers, or still piled up in the channel warehouses;

Catering terminal penetration rate: whether rice wine can enter real dining scenarios, rather than only being sold in tobacco and liquor stores;

Repeat purchase of core products: whether the sales are driven by a single viral new product, or a stable consumption habit has been formed.

The 55.78% rise of the rice wine sector can prove that market expectations have changed; the 76.59% growth of non-local revenue can prove that the enterprise's expansion has started to generate sales; the entry of large Baijiu distributors one after another can prove that channels are looking for new profit pools.

But none of these can independently prove that rice wine has completed its national expansion.

Channel distributors can deliver a bottle of rice wine to every corner of the country, but only repeat purchase can make rice wine truly stay in the national market.