Zengcheng, a far-flung district on the outskirts of Guangzhou, a glittering first-tier city in southern China, is a place where lychees flourish and denim dreams are stitched into reality.
But beneath its bucolic veneer lies a hub of entrepreneurial energy. In 2023, the district’s per capita GDP reached an impressive RMB 92,600 (roughly US$ 12,600), surpassing the national average. Home to 1.59 million people, Zengcheng is known for its residents’ tenacity and knack for innovation, traits that fuel a private economy as vibrant as its bustling markets.
Zhang Jiarong is one of Zengcheng’s many entrepreneurs. Now approaching 40, Zhang first envisioned opening a store to sell imported wine 16 years ago. His initial foray into the industry proved fruitful, earning him his first major financial success.
By 2011, China’s wine industry was experiencing rapid growth, and Zengcheng was no exception. As one of the district’s earliest import wine retailers, Zhang’s business flourished thanks to his strategic management. However, success that comes too easily can be precarious. When the central government’s austerity measures targeting luxury spending came into effect, Zhang was in the midst of expanding his business, leading to a significant financial setback.
Yet, the Chinese adage, “Persistence leads to victory,” is exemplified by Zhang’s journey. Despite challenges, he chose not to exit the industry. Instead, drawing on years of experience and his network, he managed to re-establish a brick-and-mortar store in 2018, which he has successfully operated to this day. Zhang now possesses a deep understanding of how to sell wine and the unique characteristics of Zengcheng’s market.
First Fortune
For Zhang Jiarong, as for many, wine began as a hobby. In 2009, while working in the textile industry, Zhang found himself drawn into the world of wine by a distant relative. This relative, an overseas Chinese based in Australia, owned a winery there and had recently opened a wine cellar in Guangzhou.
“I’ve always had a fascination with wine,” Zhang recalled. “This relative was equally passionate, and we clicked instantly. I realized he had access to excellent wine resources, so in 2011, I decided to open a store in Zengcheng, selling wines directly from his winery.” At just 23 years old, Zhang was entering a world that many at his age had barely begun to explore. Yet he quickly proved adept, turning his first venture into a significant financial success.
At the time, Hong Kong, thanks to its zero-tariff policy on wine, had rapidly emerged as Asia’s wine hub. Guangdong, with its shared culture, language, and close proximity to Hong Kong, inevitably felt the ripple effects. Zengcheng, just 145 kilometers away, became a part of this growing trend. Although wine was still a novelty in Zengcheng, the local middle class proved eager to embrace it.
The relative’s winery, branded as Australia 707 Wine Estate in China, was entirely self-made, with no global reputation and a resemblance to Penfolds 707. Yet, as Zhang discovered, what mattered more than pedigree was how the wine was sold.
Zhang focused on importing wines directly from Australia and introduced an experiential, club-like business model that resonated with Zengcheng’s burgeoning middle class. “We offered private Western dining paired with wine,” Zhang said. “The wine cellar had only two private rooms, so exclusivity and privacy were key. Both the wines and the ingredients for the food were imported from Australia, which guaranteed quality. Customers loved it. Sometimes we’d invite Guangdong’s top wine experts to host salons, letting clients experience the wine in a more intimate setting. Word spread quickly, and the business took off.”
His clientele ranged from government officials and corporate executives to affluent second-generation heirs. Zhang vividly remembers the boom years. “The minimum spend was 300 yuan (US$41) per person, and during peak times, the private rooms were fully booked. On busy nights, we’d turn over the rooms three or four times. Some customers, after tasting a particular wine, would clear out our entire inventory to use for corporate events or as gifts. Gift-giving and banquets were common back then, and wine was seen as a prestigious choice. Demand was high, and customers would return often to restock.”
During those years, Zhang’s small store brought in monthly revenues of 300,000 (US$40,900) to 400,000 yuan (US$54,562). With little competition—Zengcheng was still new to the wine scene—the profits were substantial. Yet this success, achieved so easily, would later prove to be a double-edged sword, setting the stage for challenges that Zhang could not have anticipated.
A Sudden Downturn
After the early success of his wine business, Zhang Jiarong, his younger brother, and a cousin decided to scale up. In 2015, they pooled 900,000 yuan (US$122,766) to rent a nearly 400-square-meter building in Xintang, the most economically developed town in Zengcheng, and opened a more expansive, luxurious wine club.
But 2015 was already three years into China’s anti-corruption campaign, which had curbed extravagant spending across the country. By 2016, a nationwide environmental crackdown and rising labor costs further strained Xintang’s denim manufacturing industry, the town’s economic backbone. Perhaps emboldened by his previous success, Zhang overlooked these warning signs. The new store adhered to an outdated “big investment, big return” model, complete with lavish renovations. It wasn’t long before cracks in the plan began to show.
“In 2016, I could feel the economy screeching to a halt,” Zhang recalled. “Orders and production in Xintang’s denim industry were falling, and people weren’t making money. Some regular customers started asking to defer payment after meals. At the same time, the anti-corruption measures made officials hesitant to dine out.”
The club’s location, chosen for its privacy, was in a low-traffic area, making it difficult to transition to a retail-focused model. These combined pressures proved insurmountable, and less than two years after it opened, the Xintang store shuttered.
Zhang reflects on that difficult time with a mixture of regret and resignation. “It wasn’t just my money—I had family involved, too. My cousin’s father invested, and in the end, it was all for nothing. We couldn’t turn things around,” he said, sighing heavily.
After the closure, Zhang took a job at Aussino, one of China’s veteran wine importers, working at their Zengcheng branch. But the role was short-lived, lasting only a few months. His next position ended just as abruptly. By 2017, Zhang realized Zengcheng’s wine market had fundamentally changed. The market’s maturation brought increased competition, a savvier customer base, and slimmer margins.
“Zengcheng is close to both Guangzhou and Shenzhen,” Zhang explained. “Customers who are serious about wine can attend local wine fairs, meet importers directly, and get better prices. Even though Aussino had a diverse and well-curated selection, it wasn’t enough to keep customers from seeking better deals elsewhere.”
China’s fragmented wine distribution system—lacking clear dealership regulations—allowed major clients to bypass middlemen easily. This issue was particularly pronounced in Guangdong, where the wine market is more advanced and importers more numerous than in other regions. As private enterprise activity slowed and cost-consciousness grew, the wine industry faced a wave of consolidation that left little room for Zhang’s old business model.
“Stay at the Table Long Enough, and the Feast Will Begin”
Despite the challenges, Zhang Jiarong never left the wine industry. In 2018, he launched a new venture, Rongpu Wine, renting a storefront in Zengcheng to open a modest yet determined physical shop.
Looking back, Zhang admits the decision was fraught with anxiety. “The memory of my earlier failure was still vivid,” he said. “But I didn’t have much choice. It wasn’t easy finding a role elsewhere, and I wasn’t ready to change industries. I had to push myself to start again. Maybe this was my only chance.”
Unlike his earlier endeavors, driven by youthful passion and a love for wine, Zhang’s second attempt was a pragmatic recalibration. Rongpu Wine moved away from the exclusivity of his former wine club model and the professional sheen of established importers. Instead, the shop embraced diversity, adding cognac, whisky, and baijiu—categories gaining ground as wine sales waned.
“Cognac and whisky don’t have much profit margin because their pricing is transparent,” Zhang explained, “but they sell quickly. If I source good products, even other local wine shop owners come to me for inventory. With enough volume, the profits are still respectable.”
In the wine segment, Zhang streamlined his inventory, focusing on a handful of brands from Australia and Spain. “I mainly work with loyal customers for group purchases, so I don’t follow a retail model,” he said. “The wines I carry are high-value options priced between 100 and 200 yuan per bottle. With my recommendations, customers try them, like them, and keep reordering. To boost sales, I’ve also tapped into the banquet market.”
Zhang speaks modestly about his business, yet Rongpu Wine has quietly endured for seven years—surpassing the lifespan of his earlier, more ambitious wine club venture. Remarkably, Zhang has now been in the industry longer than the relative who first introduced him to wine. That relative, faced with rising barriers to profitability, eventually shuttered his wine business and moved into a different field.
For Zhang, though, the journey continues. His fiery passion has been tempered into something steadier, more enduring—a quiet resilience.
Discussing Zengcheng’s wine market today, Zhang describes a landscape transformed. “Wine shops are everywhere now, and almost all of them carry wine brands. Competition is fierce,” he said. “Back then, people got into wine because of the profits. Now, aggressive price wars have made it a race to the bottom.”
When comparing his current sales to the height of his wine club days, Zhang is candid. “In 2022, when real estate was still okay, my annual revenue barely reached 700,000 to 800,000 yuan. The past two years have been much worse,” he said.
Why does he stay in the industry? Zhang is pragmatic. “I’ve been doing this for so long that changing fields would feel alien. Plus, I’ve built a network of customers. At this point, it’s about earning a living. It’s still my own business.”
To Zhang, his shop is more than a place to sell wine—it’s a platform for opportunity. “As the market evolves, this shop allows me to stay connected to people. Through those connections, new opportunities arise. Some are tied to wine; others lead to entirely different industries. It’s like when I branched into imported ingredients or spirits—the possibilities are endless, and opportunities are always out there.”
Zhang’s story is one of persistence, adaptability, and optimism. It reflects not just the struggles of a wine distributor but the broader resilience of entrepreneurs reinventing themselves in adversity. While each journey is unique, they share a common thread: through setbacks and storms, hope and imagination persist.
Stories like Zhang’s unfold not just in Zengcheng but across countless small cities in southeastern China. They are a testament to the ambition, resourcefulness, and belief in better tomorrows that define the region’s entrepreneurial spirit.
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