Grees Prepared Meal Venture Sparks Industry Debate

Dong Mingzhu's leadership in Gree Electric Appliances' foray into the prepared meal market has garnered significant attention. This article delves into Gree's strategic intentions, market prospects, and potential risks in entering this sector. By comparing successes and failures of other companies, it explores Gree's chances of success in the prepared meal equipment manufacturing field. Furthermore, the article highlights that a breakthrough in e-commerce channels is crucial for Gree to regain its peak position in the air conditioning industry. The move signals a diversification strategy amid changing market dynamics.

1. Gree's Strategic Ambition: Equipment Over Products

At a recent pre-made food industry forum in Zhuhai, Gree Electric's Dong Mingzhu announced the company's entry into the pre-made meal equipment manufacturing sector. Rather than producing pre-made meals directly, Gree will leverage its refrigeration expertise to provide specialized equipment and technical support for the industry.

This strategic positioning capitalizes on Gree's existing strengths in compressor and cold chain technology, areas critical for pre-made meal production and distribution. The company has already developed a comprehensive cold chain product line that addresses key industry needs.

  Key Insight: Gree's approach focuses on manufacturing equipment rather than competing in the crowded pre-made meal product market, creating a differentiated and lower-risk entry strategy.
 

2. The Pre-Made Meal Gold Rush: Why Everyone Wants In

The pre-made meal sector's explosive growth stems from several key factors:

Time-saving convenience: These products solve the urban professional's time crunch, offering restaurant-quality meals with minimal preparation.

Changing consumption patterns: Younger generations increasingly prefer home dining, creating demand for convenient meal solutions.

Restaurant industry efficiency: Food service businesses adopt pre-made components to reduce labor costs, standardize quality, and improve operational efficiency.

This market potential has attracted diverse players:

Nongfu Spring: Expanded from bottled water into ready-to-eat rice meals through its "Mother" brand, building on its 2018 rice industry investment.

SF Express: Leveraging its logistics network to address the sector's cold chain transportation challenges.

PanPan Foods: Entered with pre-seasoned, pre-cut meal kits requiring no additional preparation.

  Market Note: Competition intensifies as companies approach the sector from different angles—product development, distribution, or logistics—creating a complex competitive landscape.
 

3. Market Potential: Trillion-Dollar Promise or Mirage?

Industry analysts estimate China's pre-made meal market reached $48 billion in 2021, with projections exceeding $140 billion by 2026. The sector's 20% annual growth rate suggests trillion-yuan scale potential before 2030.

  While the growth trajectory appears strong, market saturation risks emerge as supply growth outpaces demand expansion.
 

4. Gree's Strategic Shift: Avoiding Past Mistakes

Gree's move reflects lessons from its delayed e-commerce adoption. The company's late entry into online sales allowed competitors like Midea to gain ground. By 2018, Gree held just 17% of China's online AC market share, trailing behind rivals.

Dong Mingzhu's subsequent embrace of livestream commerce in 2020—generating $2.5 billion across five sessions—demonstrated Gree's capacity for digital adaptation. The pre-made meal equipment play represents another attempt to capitalize on emerging trends rather than risk missing another wave.

  Strategic Context: Gree seeks to avoid repeating its e-commerce timing misstep, though success in pre-made meal equipment remains uncertain.
 

5. Market Realities: Hidden Challenges in Pre-Made Meals

Several high-profile failures illustrate the sector's pitfalls:

Qudian's Luo Min: After generating $350 million GMV with promotional pricing, the business collapsed amid product quality issues and controversy over the founder's lending background.

Lu Zhengyao's "Hero of Tongue": The ambitious 3,000-store expansion plan failed, with numerous locations closing nationwide.

  Cautionary Note: The sector's rapid expansion creates supply-demand imbalances, with many players struggling to achieve profitability despite market optimism.
 

6. Gree's Calculated Approach: Equipment as Strategic Hedge

By focusing on equipment manufacturing rather than consumer products, Gree minimizes risk while maintaining relevance to the growing sector. This capital-light approach leverages existing capabilities without requiring major new investments.

  Strategic Assessment: While pre-made meal equipment offers diversification, Gree's core challenge remains strengthening its e-commerce channels to reclaim air conditioning market leadership.
 

Gree's pre-made meal equipment strategy reflects both market opportunity assessment and lessons from past strategic delays. The company's equipment-focused approach mitigates risk, but ultimate success depends on execution and broader efforts to revitalize its core business.