Testing patent expired in 2015, all A2 testing in NZ are now carried out by LIC, which carries out 98% of all herd testing work in the country. If they own testing patents, then other brands wouldn’t be able to source their own a2 herds from Ireland and China. But they have.
Mengniu now has a2 herd size of 2,000, roughly the same as SML a2 herd size. And they created it in 6 months. So very commoditised.
They spend 8% of their sales on marketing, vs 40% of what Mengniu spends for its infant formula. And that’s why a2 sales have not taken off in China. It’s been flat 2nd half 2018, even though they increased the number of stores they are in.
And yes, the eCommerce law is quiet explicit. I can understand why for a non-Chinese speaker, the language can seem quiet hard to comprehend. But if you actually read Chinese, and see what Chinese netizens are saying, then you’d be praying for the daigou community because they are about to get rekt.
A2M Price at posting:
$9.31 Sentiment: Hold Disclosure: Held
(20min delay)