Not every Chinese knows the name Zhong Shanshan, but they all know his Nongfu Spring brand. This hugely successful bottled water has remained at the top of the Chinese market for eight consecutive years, quenching the thirst of millions. The brand’s most popular slogans include: “Nongfu Spring tastes a bit sweet,” and “We don’t produce water, we are just the porters of nature.”
Mr. Zhong is the founder of Nongfu Spring. After his company was listed on the Hong Kong Stock Exchange, its stock price skyrocketed, making it China’s largest beverage company with a market value exceeding $77 billion. In just a short span of time, Mr. Zhong became China’s richest person.
Lone Wolf Attacked
On Feb. 25, news reverberated across China about the passing of Zong Qinghou, who founded the Wahaha Group. Headquartered in Hangzhou, Zhejiang Province, this conglomerate of companies is the largest beverage producer in China,Mr. Zhong extended his condolences by sending a wreath and paying respects at the funeral home, mourning the loss of his “mentor and friend.” Yet, he notably refrained from attending Mr. Zong’s memorial service.
Unexpectedly, Mr. Zong’s demise plunged Mr. Zhong and Nongfu Spring into a maelstrom of public scrutiny. Various marketing channels and independent media outlets began dredging historical anecdotes about the two water giants, albeit with a clear bias. Many personal media platforms branded Mr. Zhong as “ungrateful” toward his former mentor.
The media described Mr. Zhong as a failed entrepreneur who found refuge under Mr. Zong’s wing. Later, he exploited the resources of the Wahaha Company to amass his initial fortune and establish Nongfu Spring as a competitor. This prompted calls for a boycott of Nongfu Spring.
Mr. Zhong’s criticism escalated unabated, calling into question his patriotism and alleged ties to Japan. The packaging design of Nongfu Spring’s products was criticized as flattering to Japan and humiliating to China.
Afterward, the Little Pinks disparaged how his son holds American citizenship. Claims circulated that by supporting Nongfu Spring, consumers were indirectly funding American interests. The orchestrated harassment of Mr. Zhong also raised suspicion of support from higher authorities.
On March 8, a 7-Eleven convenience store in Changzhou, Jiangsu Province, announced the cessation of all Nongfu Spring-related product sales, citing a refusal to endorse items perceived as promoting Japan or disparaging China.
Additionally, footage circulated of a supermarket owner returning a Nongfu Spring freezer, accompanied by bloggers’ live streams pouring Nongfu Spring mineral water down toilets and similar acts of protest.
The onslaught of verbal and written assaults dealt a significant blow to Nongfu Spring. During the first eight days of March, its stock price plummeted by 6.53 percent, resulting in a staggering $4.2 billion loss in market value. Daily sales volumes plummeted from $14,000-$35,000 to a mere $700-$1050, representing a decline of over 90 percent.
Lone Wolf Defends Himself
Amid the flurry of false accusations, the normally reticent Mr. Zhong chose to speak up on his behalf. On March 3, the Weibo account of Nongfu Spring released an article titled “Zhong Shanshan: A Few Words about My Relationship with Mr. Zong,” aiming to rebut the untruthful accusations against him.Mr. Zhong began by saying: “Mr. Zong has always been an entrepreneur I respect. We were both mentors and friends to each other, albeit competitors as well. Upon learning of Mr. Zong’s serious illness some time ago, I immediately arranged for a visit through intermediaries. However, by that time, Mr. Zong was unable to take visitors, and I regretfully couldn’t visit. After Mr. Zong’s passing, I went to the funeral home to pay my respects, laid a wreath, and expressed sympathy to his family.”
Mr. Zhong then proceeded to lament the cyberbullying against him. He expressed disbelief at the surge of online attacks, asserting that such behavior contradicted Mr. Zong’s principles. Feeling compelled to address the matter, Mr. Zhong discussed several key events involving himself and Mr. Zong.
Mr. Zhong clarified that his initial business success was not based on earnings from Wahaha, but stemmed from a curtain company he established in 1990.
He recounted his initial encounter with Mr. Zong. Upon his suggestion, Mr. Zong invested in the development and production of Wahaha porridges. He also took Mr. Zong’s suggestion and set up Wahaha offices in Guangxi and Hainan to sell Wahaha Nutri-Express. However, despite his efforts, the products couldn’t sell well in the market. He ended up selling them to a trading company that might sell the products to Guangdong.
He addressed the dispute over natural water versus purified water post-2000, highlighting its resolution under the supervision of officials in Hangzhou. He reaffirmed his belief in the importance of mineral elements in water for human health while expressing unwavering respect for Mr. Zong’s entrepreneurial spirit.
Water Quality Controversies
This incident seems like a sequel to one in 2013.From April 10 through May 7 that year, the Beijing Times dedicated a staggering 67 pages and 76 reports to scrutinizing the water quality of Nongfu Spring. Allegations surfaced claiming that its water was “inferior to tap water” and failed to meet national standards.
In response, Nongfu Spring convened a press conference on May 6 to counter the claims. The company stated that their use of the “Zhejiang Drinking Water Standard” already exceeds the “National Drinking Water Standard” mentioned in the report, and furthermore, the national standard for natural drinking water had not yet been established. They suggested that competitive interests influenced the Beijing Times’ coverage.
The impasse persisted, culminating in Nongfu Spring’s decision to exit the Beijing market and pursue 60 million yuan in compensation from the Beijing Times. The conflict ended without this payment being received due to the closure of the Beijing Times in 2017.
Harvesting Private Enterprises Amidst the Specter of the CCP
During the 2022 Central Economic Work Conference, Xi Jinping voiced his support for private enterprises, offering his guidance in helping to resolve their uncertainties. After these claims were made, it was difficult for people to comprehend why China’s Central Propaganda and Cyberspace Administration departments stood by, allowing China’s richest person and most popular bottled water brand to be cyber-scourged and publicly humiliated, resulting in a 90 percent drop in sales.Speculation emerged suggesting that harming Nongfu Spring, a private enterprise, was meant to benefit Wahaha, of which 46 percent of it is owned by a state-owned investment company.
While these rumors are unconfirmed, it is no surprise that the Chinese Communist Party (CCP) is in desperate need of money, and private enterprises are their coveted targets.
Moreover, Mr. Zhong lacks political heritage and support. His parents were rightists, and he is not a member of the CCP. He has publicly stated, “I don’t like flattery and won’t drink or dine to socialize with people.”
In Communist China, wealthy business people who lack political heritage and the support of prominent figures are certain to face difficulties. Although Mr. Zhong has endured tremendous hardships, his future and that of Nongfu Spring are uncertain.
