Zhong Shanshan, China’s richest man and the founder of bottled-water giant Nongfu Spring, has vowed to steer clear of price wars, after a year of aggressive price cuts and online personal attacks cost his company billions in market value.
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“Blind pursuit of low prices, especially through internet-driven price wars, is destroying the quality of Chinese products and undermining China’s economy,” the billionaire said on Thursday at a company event. “Only the incompetent resort to price wars. With strong expertise, advanced capabilities and true innovation, price wars are unnecessary.”
The remarks came after Zhong in November unexpectedly lashed out at Pinduoduo, a Chinese e-commerce platform with over 900 million users, for adopting “low-price strategies that have stymied the development of the industry ecosystem”. In videos that previously circulated on Chinese social media but have since been removed, the tycoon even went so far as to criticise Chinese authorities for their lack of regulation over e-commerce platforms.
Despite claiming to detest price wars, Nongfu in April introduced a budget bottled water product priced at under 2 yuan (US$0.27) in an attempt to regain market share.
In November, Zhong admitted that the decision to launch the budget product was made “in a moment of impulse”, adding that the product lacks value and is unsuitable for long-term consumption.
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