According to a report by self media food reference on July 25th, two executives from Mondelez China were suddenly taken away on suspicion of embezzlement and large amounts of money. At the same time, their employee accounts were cancelled, computers were confiscated, and related structures were also lost. That evening, Mondelez China held an impromptu meeting to discuss this matter; At the meeting, Mondelez specifically requested that company employees "refrain from speaking" about this matter.
According to the screenshot cited in the above report, the executives involved are Grace Zhu, Vice President of Marketing and Development at Mondelez Greater China, and Simon Xiu, Director of E-commerce at Mondelez China.
In this regard, Interface News consulted with the public relations personnel of Mondelez China and received the following response: "Our company has taken note of the self media article. The two employees mentioned in the article are cooperating with the investigation and are currently off-duty. We will release information in a timely manner based on the official investigation results. Our company adheres to the highest compliance culture standards, actively cooperates with relevant departments to conduct a detailed investigation, and will handle any behavior that deviates from the company's values in accordance with the law and regulations
As a super snack manufacturer, Mondelez International has multiple star brands with annual revenue exceeding $1 billion, such as Cadbury, Milka Chocolate, Jacobs Coffee, LU Biscuits, Nabisco and Oreo Biscuits, Guozhen Solid Beverages, and Trident Gum. In 2023, Mondelez International's global net revenue increased by 14.35% year-on-year, and net profit increased by 82.25% year-on-year.
Mondelez China owns several well-known brands among Chinese consumers, including Oreo, Fun Duo Duo, Youguan, Xianqu, Wangzi, Taiping, Lezhi, Yikoulian, Hershey's, Xuanmai, Miaoka, and Guozhen. In the first quarter of 2024, Mondelez China's performance was also impressive in the overall global performance. According to the financial report, the net revenue of the AMEA (Asia, Middle East and Africa) region, which is owned by Mondelez China, in the first quarter was 1.95 billion US dollars (about 14.069 billion yuan), an organic growth of 5.9% year-on-year. Among them, the sales/portfolio decreased by 0.2 percentage points, the lowest decline among all regions.
Zhu Yijing is a veteran in the fast-moving consumer goods industry. Public information shows that Zhu Yijing joined Mondelez China in May 2019. From 2019 to the end of 2021, she served as the Sales Director of Mondelez Greater China, and then as the Head of the Marketing and Development Department of Mondelez China, mainly responsible for marketing, consumer insights, e-commerce, and catering channels. Prior to this, she had worked at companies such as Nielsen and PepsiCo.
Xiu Zerong's position is the E-commerce Director of Mondelez China Greater China, responsible for e-commerce and O2O business. An industry speech event in February 2024 introduced him as having 20 years of experience in the fast-moving consumer goods industry, with a deep understanding of offline KA channel customer management, online e-commerce channels, and O2O business development.
In April of this year, Zhu Yijing stated in an interview with China Business News that since 2019, Mondelez China has achieved high single unit growth in 2023 through digital transformation of online and offline channels, expansion of sales network, and investment of more than 50 million yuan to build an intelligent warehousing center in Beijing. At the same time, it has also increased its joint marketing efforts.
She mentioned in the interview that "according to Nielsen's data and other external data, our cookie category has the highest market share, both online and offline; chewing gum is second, and chewing gum ranks first among young people." Among them, Mondelez has shown outstanding performance in creative marketing activities. According to Kantar data, in March of this year, the brand penetration rate of Quduoduo reached a historic high; Oreo has launched a co branded product with the popular IP Line Dog, an ice cream product in collaboration with Nestle, and multiple spring limited edition "Sunshine Lemon Flavor" new products.
Zhu Yijing's approach of expanding channels and branches mentioned above has also received support from the headquarters. At the 2023 earnings conference, Mondelez CEO Dirk Van de Put expressed his intention to further expand distribution channels in emerging markets, including China, by selling products such as Oreo through more convenience stores and mom and pop shops. He revealed that about 50% of Mondelez's organic growth in emerging markets is driven by distribution expansion, and if we look globally, about 2% of its additional organic growth comes from this.
Regarding the possible corruption issues behind the sudden removal of executives from Mondelez China, two distributors in the fast-moving consumer goods industry told Interface News that the phenomenon of "corruption involving expenses due to different channels or chaotic channels" mentioned in the above report exists in many large fast-moving consumer goods companies.
For example, the business in some channels or regions is relatively stable. The leadership basically decides which dealer to do it for. There is a lot of rent-seeking space, which is prone to corruption. On the other hand, the reason is that in the process of change, it usually involves the actions of replacing and increasing distributors, and the cost control in between is also a high-risk area for corruption.
In addition, the uniqueness of the Chinese market lies in the fact that over 90% of the millions of sales outlets and terminals are traditional channels, such as convenience stores, husband and wife shops, and tobacco hotels. Due to the high cost of business operations, companies often need to invest heavily in order to exchange money for efficiency.
For all parties on this chain, display fees, electricity fees, promotional activity fees, material costs, etc. are all spaces that can generate gray income.
When brand data growth is good, corruption issues may be overlooked, but when growth is weak and stagnant, these issues are more likely to be exposed, "the distributor told Interface News, similar to the previous issue of a senior executive from Yuanqi Forest being detained for corruption.
Corrupt behavior from executives to middle management in the fast-moving consumer goods industry is not uncommon. In January 2023, Ye Licheng, the former head of Yuanqi Forest Marketing Center, was criminally detained by the police on suspicion of major economic crimes such as corruption. Subsequently, Yuanqi Forest dismissed Ye Licheng. In 2020, Cai Xiaogang, the director of the logistics department of Nongfu Spring, was sentenced to eight months in prison for accepting bribes of 115000 yuan from suppliers.
Regarding the latest developments, personnel from Mondelez China's public relations department told Interface News that a new statement is expected to be made within this week.