Facing dual pressures of performance and public scrutiny, Sichuan Swellfun Co., Ltd. (600779) has seen its top public relations executive resign at the end of November. Reports indicate that Hong Zonghua, the former Chief Public Affairs Officer, has left the company and swiftly joined PepsiCo China.
Observers note that during Hong’s tenure since October 2021, he served under four different CEOs—an unusual turnover rate even within the liquor industry. Despite his widely recognized expertise, Hong faced persistent challenges managing crises for Swellfun, including recent controversies over exorbitant CEO compensation, steep profit declines, and the company’s first quarterly loss.
When Hong joined, Swellfun’s market capitalization peaked above ¥70 billion but has since plummeted below ¥20 billion. His career, however, remains unscathed: PepsiCo—a far more prominent multinational—appointed him as Vice President of Corporate Affairs for Asia-Pacific.
**A PR Veteran’s Four-Year Stint** Hong’s career has centered on consumer sectors. Before Swellfun, he held roles as Director of Government Relations at Walmart China (2014–2018) and Senior Director of Corporate Affairs at Herbalife China (2018–2021). At Swellfun, he oversaw government relations, corporate communications, ESG strategy, and industry collaborations.
Notably, Hong worked under CEOs Zhu Zhenhao, Ian Atha, Hu Tingzhou, and interim leader Jiang Leifeng. Swellfun’s frequent leadership changes—eight CEOs in 15 years under Diageo’s control—have led to erratic strategies, such as pivoting from premiumization in 2024 to a "Dual-Star" product strategy in 2025, leaving teams disoriented.
**Mounting PR Pressures** 2025 proved particularly grueling, with Swellfun grappling with slumping sales and outrage over Hu Tingzhou’s ¥6.23 million salary for just six months’ work—making him the highest-paid executive among listed liquor firms. The 2025 interim report revealed a 38% revenue drop, 71% net profit plunge, and a quarterly loss, lagging behind peers despite industry-wide headwinds.
Price inversion—where retail prices fall below wholesale—has plagued core products like Zhenniang No.8 and Jingtai. For instance, Zhenniang No.8 sold for ¥270/bottle online (¥90 below wholesale), prompting Swellfun to halt shipments and penalize distributors, yet chaos persists. Channel confidence further eroded as Swellfun launched the ultra-premium "First Workshop" brand while its mainstay products floundered.
Hong’s successor remains unnamed, but the role will undoubtedly inherit these formidable challenges.
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