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In recent years, many Chinese liquor companies, particularly leading firms, have turned their focus to overseas markets, aiming to achieve new growth through international expansion. However, the internationalization of baijiu still faces significant challenges that demand from industry players. 

Accelerated Progress, Persistent Challenges 

In 2024, Chinese baijiu made modest strides in global markets. Data shows that baijiu exports reached $970 million, a 20.4% year-on-year increase, with export volume hitting 16.42 million liters, up 6.3%. Baijiu accounted for 51% of China’s total alcohol exports, solidifying its position as the top category. However, its global market share remains low. The China Alcoholic Drinks Association reported that the total sales revenue of large-scale baijiu enterprises in 2024 was ￥796.384 billion, with exports contributing merely 0.85%. Even leading brands like Moutai and Wuliangye generate less than 5% of their revenue overseas. 

Key challenges persist. First, cultural and consumption habit differences hinder acceptance. Baijiu’s intense flavor contrasts sharply with Western spirits like whiskey and vodka, limiting its appeal. Second, complex overseas regulations and monopolized distribution channels raise market entry barriers. Third, exports remain concentrated in overseas Chinese communities, failing to penetrate mainstream consumers. 

Structural Issues: Internal and External Pressures

The industry’s struggles reflect deeper structural contradictions. 

1. Overcapacity vs. Scarcity Balance: The sector grapples with excess production and high inventory. In 2024, the average inventory turnover period reached 868 days, a five-year high, with some companies exceeding 2,000 days. While top brands like Moutai manage inventory through production controls, overcapacity persists. Expanding output risks diluting the exclusivity critical to premium baijiu’s brand value. 

2. Monolithic Value Proposition: Baijiu’s traditional emphasis on business banquets and gifting clashes with younger consumers’ preferences for health, fashion, and personalization. 

3. Product Structure Imbalance**: The market exhibits a “dumbbell-shaped” consumption pattern, with ultra-premium and budget products thriving while mid-range offerings face inventory pressures. This imbalance leaves mid-to-high-end markets oversupplied and neglects demand for affordable or customized options. 

Prioritizing Internal Reforms

To address these issues, the industry must refocus on strengthening fundamentals: 

- Redefining Values**: Shift from business-centric narratives to promoting health-conscious and trendy drinking cultures. Aligning with younger consumers’ priorities—quality and lifestyle—is crucial. 

- Adjusting Product Portfolios: Develop diversified, high-quality products. For international markets, consider lower-alcohol or fruit-infused variants; domestically, enhance production innovation and cost efficiency to deliver better value. 

- Rationalizing Pricing**: Overhaul inflated pricing systems. Align prices with costs, demand, and brand positioning to eliminate market bubbles and price inversions. Data-driven pricing strategies should reflect true product value and market dynamics. 

While baijiu’s global potential is undeniable, resolving structural bottlenecks remains urgent. Only by cultivating internal competitiveness can the industry secure a sustainable foothold on the world stage.