From imported formula to fresh milk: six appointments

Mandate

Bring distributor credit under control, return e-commerce to profit and give a state-linked listed board a clear view of cash, raw-milk commitments and currency.

Outcomes

• Cut distributor receivables from RMB 820 million (71 days) to RMB 270 million (27 days) by December 2023.
• Moved e-commerce from a RMB 96 million contribution loss in 2022 to a RMB 58 million profit in 2025.
• Honoured 46 contract-farm agreements through the raw-milk surplus; 44 renewed on index-linked prices in 2025.
• Reduced net debt from 2.4 times EBITDA in 2021 to 1.3 times (RMB 1.5 billion) at December 2025.
• Recommended deferring a HK$2.5 billion Hong Kong listing; the board agreed in August 2025 and adopted an annual capital-structure review.

Decisions in context

I became CFO in April 2021, five years after joining Cuiling as deputy, when my predecessor retired. Revenue had grown from RMB 5.2 billion in 2016 to RMB 6.9 billion in 2020, partly through the acquisition of a Fuzhou yoghurt maker, and distributor credit had grown faster than sales. The president's brief was to restore cash discipline without breaking a sales organisation built on relationships. Distributor credit came first, then the e-commerce channel, then the raw-milk surplus that arrived in 2023 and the Hong Kong listing proposal of 2025. I lead 260 people with seven direct reports and attend every board meeting without a vote, presenting results, budgets, capital plans and the quarterly cost of the farm commitments. Revenue reached RMB 8.62 billion in 2025 and EBITDA RMB 1.12 billion, while net debt fell from 2.4 times EBITDA to 1.3 times.

Reason for the move

Current role. Not seeking an executive move; considering one independent directorship with the Cuiling board's consent.

Mandate

Give the sales organisation channel-level and outlet-level economics, and bring order to treasury and currency exposure.

Outcomes

• Built cost-and-return economics for 31,400 chilled cabinets; 4,600 moved and 3,300 withdrawn; sales per cabinet up from RMB 38,000 to RMB 52,000 a year.
• Consolidated 23 bank relationships into nine and cut the average cost of borrowing by 0.6 percentage points.
• Wrote the board's first currency-hedging policy for imported powder, approved in 2018.
• Ran finance for the RMB 680 million acquisition and integration of a Fuzhou yoghurt maker in 2019.

Decisions in context

I joined Cuiling from the beverage industry because I wanted to work in chilled dairy, where cash, shelf life and the channel meet more sharply than anywhere else in food. My brief from the CFO was to give the sales organisation economics it could act on. The chilled-cabinet model was the first result: every cabinet's sell-out, servicing and electricity subsidy set against what it cost, so that sales teams could move cabinets to better shops instead of adding more. In treasury I reduced our banks from twenty-three to nine and wrote the board's first hedging policy for imported powder, which proved its value in 2022. In 2019 I ran finance for the acquisition of a Fuzhou yoghurt maker for RMB 680 million and integrated its distributors into our credit process. I also saw distributor credit growing faster than sales and could not yet change it.

Reason for the move

Appointed CFO by the board when my predecessor retired.

Mandate

Bring the finance function to listed-company standard and prepare a Hong Kong listing.

Outcomes

• Reduced the monthly close from 15 working days to six.
• Refinanced RMB 900 million of short-term loans into three-year facilities.
• Cut unreconciled distributor rebate claims from RMB 64 million to RMB 9 million.
• Prepared a Hong Kong listing that the board withdrew in the autumn of 2015 when markets fell.

Decisions in context

Mingxi was my first role as a company's senior finance officer. The founder had built a strong regional brand of tea drinks and juice but ran it on monthly accounts that took three weeks to close, and Tidewell Capital Asia, which held 38 per cent, wanted an exit through a Hong Kong listing. I rebuilt the close, reconciled years of distributor rebate claims and refinanced short-term loans that renewed every few months. Most of 2015 went into the listing: an offshore holding structure, three years of audited accounts, a prospectus and a long series of meetings with sponsors and investors. When markets fell sharply that summer, the board withdrew the offering. I learnt how much of a listing's cost is spent before anyone knows whether it will happen. Early in 2016 Tidewell sold its stake to a food group with its own finance leadership, and I moved on.

Reason for the move

After the withdrawn listing, the private-equity investor sold its stake to a food group in early 2016 that brought its own finance leadership.

Mandate

Keep commercial finance and distributor credit in step with sales after demand for imported formula surged in 2008.

Outcomes

• Required deposits and thirty-day terms for about 200 new distributors opened after September 2008, limiting later losses to RMB 19 million.
• Built distributor profitability statements for all 410 accounts.
• Introduced monthly stock checks at the 60 largest distributors to stop parallel resale across provinces.

Decisions in context

I was promoted to commercial finance director two months before the melamine contamination of domestic infant formula became public in September 2008. Within weeks distributors who had sold domestic brands were queuing to buy imported formula, and our revenue roughly tripled over the next four years. The sales director wanted to open two hundred distributors on sixty-day credit; I argued for prepayment and we settled on deposits and thirty days. About a third of those distributors failed or left within three years as confidence in domestic brands returned, and our losses stayed at RMB 19 million. I also found that some distributors were reselling our formula across provinces at prices that undermined others, and introduced stock checks at the largest accounts. By 2012 I wanted to run a complete finance function rather than one part of it.

Reason for the move

Wanted to run a whole finance function as CFO.

Mandate

Give the subsidiary a reliable view of landed cost, distributor margin and the effect of the euro on each product.

Outcomes

• Built landed-cost models for 48 products covering freight, duties, value-added tax and the euro rate.
• Introduced monthly distributor margin reports used in annual price negotiations.
• Reduced write-offs of short-dated imported stock from 2.8 per cent of sales to 1.1 per cent.

Decisions in context

I joined Veldhaven's China subsidiary from audit because I wanted to see a consumer business from inside. The company imported every product it sold, paid in euros and sold through distributors who knew far more about their markets than we did. My first task was landed cost: freight, duties, value-added tax and the exchange rate for each of 48 products, so that we knew what a tin of formula really cost us when it reached Shanghai. Then I built monthly distributor margin reports, which our sales team used in price negotiations for the first time. Short-dated stock was a constant problem, because imports arrived in large shipments with fixed shelf lives, and we cut write-offs by matching orders to distributor sell-out. The work taught me that currency and shelf life are both forms of time, and both cost money.

Reason for the move

Promoted to commercial finance director.

Mandate

Plan and run audit fieldwork for consumer and retail clients.

Outcomes

• Led fieldwork on about twelve audits a year by 2002.
• Introduced testing of supplier rebate and slotting-fee contracts at retail clients.
• Qualified as a certified public accountant in 2001.

Decisions in context

I joined Jiaheng straight from Weixi Institute of Finance and Commerce and stayed five years, qualifying as a certified public accountant in 2001. Most of my clients were food manufacturers and retailers in and around Shanghai. The work that shaped me most was at a supermarket chain, where income from suppliers, in rebates, slotting fees and promotion charges, was larger than the chain's net profit and was recorded from a spreadsheet kept by the buying department. I persuaded the partner to test those contracts as a separate audit area, which became our practice for every retail client. By 2003 I was leading fieldwork on about twelve audits a year with teams of three to six. I left because I wanted to make the judgements I had spent five years testing.

Reason for the move

Wanted to work inside a consumer business and make decisions rather than test them afterwards.