[Report] Tofu Bar Craze Sweeping Japan Hits China... The Origin Country's 'Winning Move'

Visiting Pulmuone Beijing Pinggugu Factory
New Tofuba Production Starts This Month... Targeting Chinese Taste Preferences

"Wiiiiiiing~."

As the thick door opens, the cooler immediately responds and starts running. It detects the slightly inflowing outside air and maintains the optimal temperature of '5 degrees.' This is the scene encountered only after putting on dustproof suits, masks, sanitary caps, and sanitary overshoes, disinfecting hands and the entire body, and passing through four consecutive doors.

The Pulmuone 2nd Factory in Pinggu District, Beijing, China, visited on the 23rd, was like the company's 'forward base.' Packaged tofu, processed tofu, dubjang, and the recently introduced 'Tofu Bar' distributed across the Chinese mainland are all manufactured here. The products made here are sold at 250 distribution companies and 20,000 stores nationwide through the cold chain system established by Pulmuone.

The 2nd factory was completed in April 2022 and is now in its third year of operation. Including the 1st factory completed in September 2012, the Beijing Pinggu District plant covers a land area of 28,247㎡ and a building area of 18,703㎡. It is a large-scale facility consisting of six buildings, including two factories, a wastewater treatment plant, warehouses, and a security office.

On the 23rd, I visited Pulmuone's second factory in Pinggu District, Beijing, China. Soy milk made from washed soybeans is being turned into tofu. (Photo by Hyunjung Kim)

On the 23rd, I visited Pulmuone's second factory in Pinggu District, Beijing, China. Washed soybeans are being transported along the line for tofu production. (Photo by Hyunjung Kim)

Tofu Bar, a Hit with 70 Million Units Sold in Japan... Challenging the Tofu Homeland

The Tofu Bar is made by aging tofu produced in the same factory in a 5-degree aging room for 12 hours, seasoning it, then going through processes such as kneading, molding, cooling, baking, and multi-packaging. Since starting the production line on the 1st, it began entering 330 Seven-Eleven stores in Beijing and Hebei regions on the 2nd, awaiting initial reactions. The internal investment review began in November last year, production line preparations started in March this year, and the project was launched decisively within 10 months.

The background of this quick decision and execution is the successful experience in Japan. The Tofu Bar was launched by Pulmuone's Japanese subsidiary Asahiko in 2020 and surpassed cumulative sales of 70 million units in three years, becoming a so-called 'blockbuster product.' Based on this, it entered Singapore in April and has just debuted in the Chinese mainland, the homeland of tofu. Currently, Korean-style sweet flavor and Chinese-style spicy flavors such as Korean Bulgogi and Xiang La have been released. Priced at 7.9 yuan (about 1,500 KRW), it is a typical convenience store snack price.

Kim Yong-ju, head of Pulmuone's Beijing factory, explained, "In China, as in Japan, there is increasing demand for healthy protein intake, and so far, the snack market is mainly focused on animal protein such as chicken breast and crab sticks. We aim to break away from traditional processed tofu competition and pioneer a new category of plant-based protein refrigerated snacks."

Kim Yong-ju, the head of Pulmuone's Beijing factory, introduced the 'Tofu Bar' product to reporters at Pulmuone's factory in Pinggu District on the 23rd. (Photo by Kim Hyun-jung)

Post-Zero-COVID in China, Performance Slows... "Investment Continues"

Pulmuone is a food company recognized alongside Orion as a successful localization case in China. However, like most new corporations, Pulmuone only turned a profit for the first time in 2020 after ten years of hard struggle since establishing its Beijing subsidiary in 2010. The establishment of the 2nd factory was also an investment executed encouraged by the hard-earned results amid the COVID-19 situation. As a result, a stable dual production system was completed: the 1st factory produces pasta, cold noodles, rice cakes, and sauces, with pasta accounting for the highest sales proportion (38% as of 2023), while the 2nd factory manufactures packaged tofu, processed tofu, Tofu Bar, and dubjang.

However, last year's performance fell short of expectations. The transition to With-Corona became a major setback for the industry, and increased dining out demand hit sales and profits. Pasta and tofu sales, which reached 478.58 million yuan (about 91.5 billion KRW) in 2022, shrank to 395.33 million yuan last year.

Nevertheless, Pulmuone is reviewing investments to establish a new factory in southern China, including Guangdong Province. By the end of next month, it plans to introduce and start selling frozen gimbap, which is wildly popular in the U.S. This is the result of the headquarters' proactive will and on-site efforts.

They also spare no investment or expenses to improve employees' working conditions. In fact, inside the Beijing factory, coolers are busily running everywhere to help employees escape the heat. These facilities were not present at the factory's early operation but were created through the concerns of the factory manager and executives. A site official explained, "Because the work is tough, factory production workers usually move quickly chasing wages, but employees here have worked for more than four years. This is based on trust in the work and the company."

Kim Yong-ju, Plant Manager of Pulmuone Beijing, introduced the wastewater treatment process to reporters at Pulmuone's wastewater treatment plant in Pinggu District on the 23rd. (Photo by Kim Hyun-jung)

Meticulous hygiene management and strict adherence to principles have saved the company through multiple crises. Recently, the factory successfully passed on-site inspections by supervisory agencies following the aftermath of the edible oil incident (transportation of cooking oil by tanker) in China. The city authorities have repeatedly tried for years to push manufacturing plants generating wastewater out of Beijing, but the factory maintained its location by purifying water to agricultural water standards through its own wastewater treatment plant before discharging into the sewage treatment plant. It is also a rare Korean company certified as a high-tech enterprise, receiving benefits such as a 10% corporate tax reduction.

The biggest current challenge is the technology and marketing strategies of rapidly growing local companies. Doo Jin-woo, CEO of Pulmuone China, said, "The biggest concern is that rapid market changes make it difficult to predict distribution channels. In the past, Pulmuone's products stood out uniquely on shelves, but now local competitors have caught up in many aspects, and it is difficult to secure price competitiveness with low costs."