Saky Deepens Partnership with E-Asia Supply Chain to Compete in the Oral Care and Wellness Market, Backed by Legend Capital

VCBeat (WeChat: vcbeat) has learned that Yishang Finance, the supply chain finance service platform under Eternal Asia (002183.SZ), recently signed a strategic cooperation agreement with oral care company Weimeizi. The resources of Weimeizi’s two major brands, Saky and Saky Kids, will be integrated with Eternal Asia’s supply chain ecosystem and Yishang Finance’s “Supply Chain + Finance + Technology” platform to jointly tap into the oral health market.

According to AC Nielsen's research and analysis report, the entireThe total market size for oral care has reached RMB 25.7 billion., it is projected that China’s oral health market—encompassing oral care, prevention, and treatment—will exceed RMB 500 billion over the next 15 years, indicating that the full potential of the oral health market has yet to be realized.

During the rapid expansion of the market, in addition to “foreign giants” such as Colgate and Crest benefiting significantly, there has also been an emergence ofYunnan Baiyao, Saky, Nice Group, and Other Leading Domestic Brands, competition is becoming increasingly intense.

According to AC Nielsen statistics, Saky toothpaste’s market share in the supermarket and hypermarket channel continued to grow from 2014 to 2017. In the mid-to-high-end segment priced above RMB 10, Saky ranked second, with an average transaction value of RMB 12.6 per 100 grams, trailing only Yunnan Baiyao (RMB 18).

Saky was the only brand among the top ten in the supermarket and hypermarket channel to record significant growth, with its sales share reaching 11% in 2017, a 0.4 percentage point increase from 2016, while most other brands experienced a decline.

Furthermore, Saky’s children’s product line, Saky Baby, has also demonstrated a stable growth trend, becoming the leading offline brand with a market share exceeding 35% in supermarket and hypermarket channels.

Since receiving Series A investment from Legend Capital, a subsidiary of Legend Holdings, in 2014, Weimeizi began to lay out oral smart care centers across China, proposing an integrated marketing strategy from "products" to "services" to connect the upstream and downstream industrial chains from daily oral care to professional diagnosis and treatment, aiming to build an industrial ecosystem of "Internet + Oral Care + Oral Medical Services".

In 2016, Weimeizi secured hundreds of millions of yuan in Series B funding from Lancheng Asia and Zhongding Venture Capital.Analysis suggests that Saky, having already secured two rounds of investment, must now scale up its operations in preparation for a future initial public offering (IPO).

Currently, Saky primarily operates on e-commerce platforms such as Tmall, JD.com, and Vipshop, with online sales accounting for approximately 20% of its total revenue. Its offline presence is mainly concentrated in large hypermarkets and supermarkets, including National Key Accounts (NKA) and Local Key Accounts (LKA). In the future, leveraging the capabilities of Eternal Asia, Saky aims to further expand its terminal coverage and intensify efforts in developing new channels, such as maternal and infant care outlets and Over-the-Counter (OTC) pharmacies.

“Previously, we relied entirely on our own strength to carve out a niche in the highly competitive oral care market. However, going forward, relying solely on ourselves is far from sufficient; we must forge strong alliances and move toward a model of symbiotic growth and mutual benefit,” revealed Cao Rui’an, Managing Director of Weimeizi. He disclosed that Weimeizi achieved sales volume of RMB 4 billion in 2017, with a growth rate exceeding 30%.

Data shows that, as China’s first listed supply chain enterprise, Eternal Asia has established distribution networks in nearly 300 cities across 31 provinces, autonomous regions, and municipalities directly under the Central Government, covering approximately 1.5 million end-terminals. Yushang Finance is a wholly-owned subsidiary of Eternal Asia.Focusing on providing "chain finance" services through supply chain data integration capabilities, providing tailored financing solutions for brand manufacturers and their upstream and downstream partners.

As early as 2016, Weimeizi began collaborating with Eternal Asia. Last year, the two companies officially launched a strategic partnership, leveraging Eternal Asia’s 380 distribution platform to facilitate Saky’s market upgrading and omni-channel penetration across China.

This partnership with Yushang Finance,Weimisi Will Deepen Cooperation with Eternal Asia’s Supply Chain Ecosystem, provide corporate guarantees for comprehensive credit lines to downstream distributors, and leverage backend procurement and sales big data along with Yushang Finance’s fintech solutions to enhance marketing efficiency and rapidly capture market share.

Weimeizi and Eternal Asia will engage in deep strategic cooperation across three dimensions: logistics, commercial flows, and capital flows. First, they will focus on warehousing, logistics, and distribution to jointly explore new models of logistical collaboration. Second, they will deepen channel cooperation in terminal channels, maternal and infant sectors, and new retail. Finally, they will develop upstream and downstream financing solutions from the perspectives of customers, supply chain, and direct key accounts (KA).

As competition in online channels intensifies, costs continue to rise, and the concept of new retail is proposed, this has promptedBrands Reassess the Importance of Offline Channels。

According to Chen Weimin, Vice Chairman of Eternal Asia and President of the Yushang Financial Holdings Platform, Yushang Finance’s total funding disbursement to Vimiex this year is estimated at approximately RMB 300 million. “Based on an average financing amount of RMB 2–3 million per transaction, this would cover more than one hundred distributors,” he noted. In Mr. Chen’s view, all channels—whether brick-and-mortar retailers, e-commerce platforms, or specialized institutions such as dental clinics that may be involved in the future—are subject to settlement cycle requirements.

“Payment terms may involve monthly settlements with a 30- to 60-day credit period after delivery. However, many of these entities are small and medium-sized enterprises (SMEs) that face difficulties in securing bank financing. Despite having strong business operations, high-quality products, and robust upstream and downstream relationships, their financing needs can be met quickly through supply chain finance.” Regarding partner selection, Chen Weimin stated that priority would be given to upstream and downstream suppliers with long-term cooperative relationships with Saky, as well as upstream and downstream partners in emerging markets that are slated for key future expansion.