New National Standard For Electronic Cigarettes Online
On August 29, Shenzhen officially became the first batch of pilot cities on the national unified electronic cigarette trading management platform (hereinafter referred to as "management platform"). Effective immediately, products that pass the national standard "electronic cigarettes" (GB 41700-2022) (hereinafter referred to as "new national standard products") can be traded wholesale and retail through the management platform, the industry production and sales are entering a new phase of standardized management.
After the new national standard products on line, what changes will be ushered in the first-line consumer market? According to the South China Electronic Cigarette Industry Observation Group visit, the industry is still in a short-term adjustment period, but the industry remains optimistic about the future.
In response to the current feedback from the first-line consumer market, electronic cigarette industry expert Zheng Zhi pointed out that the domestic electronic cigarette market in the short and medium term setbacks can be expected, but due to the limitations of taste, which can easily lead to a narrowing of the differences between products, which requires companies to be more responsive to the flood of times in the future, with more solid product strength and brand influence.
The new national standard products on line in Shenzhen stores, a short-term market is still in the adjustment period
Previously, the group had reported that the "electronic cigarette management measures" issued by the State Tobacco Monopoly Administration has been officially implemented on May 1, which clearly "prohibits the sale of flavored e-cigarettes and atomized e-cigarettes in addition to tobacco flavor," and set a transition period of five months. At the same time, the national standard "electronic cigarettes" will come into force on October 1, which also defines the design and raw material requirements, technical requirements and other indicators for electronic cigarettes.
This means that from October 1, the domestic electronic cigarette production and sales market officially entered a new phase of standardized development. Shenzhen, as the pilot city that officially launched the national unified electronic cigarette trading management platform, also ushered in the first line of the consumer market change period.
On September 2, the subject group visited a number of e-cigarette stores to learn that some stores have been on the new national standard products. Some store owners informed the subject group that on the day the management platform was launched, they had placed orders for small quantities of the new national standard products and tried to sell them in their stores. However, some store owners said that the market acceptance of the new national standard products is limited, it is expected that there is still a short-term adaptation period, "electronic cigarette users are mostly in the 20-35 year old range, the taste of the product requires light, sweet and cool preference, and the new national standard products taste imitation of cigarettes, the taste is heavy, the future will largely lead to changes in consumer groups.
The group observed that the new national standard of e-cigarette devices and e-cigarette pods in the packaging and products are printed with the obvious "no smoking for minors" logo wording. Miss Feng, who came to the store to experience the new product, said that the new product design and taste gradually standardized for consumers is good, but should also take care of the needs of different consumer groups. "In the past, the trendy attributes of e-cigarettes were stronger, with relatively more appearance customization and flavor choices, while today's e-cigarettes should also properly take care of the needs of the original consumer groups under the requirement of more safety and meet the diversity of consumer preferences."
Experts: technical innovation and brand influence to become the core competitiveness of enterprises
From a short-term perspective, the first-line consumer market in the policy requirements have entered the standardized development of the adjustment period, failure to produce products and manufacturers in line with the standards as soon as possible will be shuffled out of the game. In the medium and long term, many industry insiders remain optimistic about the future development of the electronic cigarette industry.
For the relevant departments for the electronic cigarette industry technical review, a tobacco industry experts pointed out that the overall review process is scientific and effective, and some of the products reviewed are also successfully listed. Some users feedback on the existing flavor is more "single", which is more stringent with the review may be related.
"In the flavor review, the more explicit requirements are 'tobacco flavor. But because the process of producing e-cigarette aerosol without combustion, basically no tar, it is difficult to reproduce the flavor of cigarette tar. Therefore, e-cigarettes are unable to fully imitate the flavor of cigarettes. Second, the electronic cigarette 'tobacco flavor' needs to be reflected through the tobacco extract. In accordance with the requirements of the existing review, tobacco characteristics are strong enough, it is bound to add a large number of tobacco extracts, which may lead to a portion of the more harmful impurities such as nitrosamines and polycyclic aromatic hydrocarbons brought into the atomized liquid and aerosol, bringing new safety problems."
In the expert's view, whether for cigarettes, or for electronic cigarettes, the main goal of regulation is to reduce the "induction", especially for minors. The national standard in the additives, product design and other aspects of the product's safety bottom line, but also pointed out the "rejection of minors, reduce the induction" direction, which it believes will be a new starting point for the standardization of the development of the electronic cigarette industry.
In response to the current feedback from the frontline consumer market, electronic cigarette industry expert Zheng Zhi pointed out that the domestic electronic cigarette market is expected to decline in the short term, but due to the limitations of the taste, which can easily lead to a narrowing of the differences between products, which requires companies to comply with the flood of the times, with more solid product strength and brand influence.
"Without the characteristic flavor, no high and low nicotine experience, no open nicotine DIY creation, the provision of a warning statement on the smoke bomb vape and the requirement to use only the raw materials in the white list for flavor design, these factors will eventually lead to the similarity of the electronic cigarette products launched by each company from the shape to the taste will be very high. In this case, the only thing that companies fight for is brand influence and the first to achieve greater technological innovation."
Electronic cigarette industry export advantages in the long term, need to further optimize the new manufacturing business environment
Since 2019, with the domestic policy level on the development of the e-cigarette industry standardization requirements tightened, the industry's head enterprises actively respond to national policies, while seeking to enhance their own R & D, product strength of the path to build a patent moat for the Chinese e-cigarette industry.
According to the data of the Electronic Cigarette Professional Committee of the China Electronic Chamber of Commerce, from 2003 to October 31, 2021, the total number of domestic patent applications was 26,403, of which 93.4% were for liquid electronic cigarettes. Overall, the last three years is the period of concentrated emergence of electronic cigarette patents; among them, Guangdong Province is a large province of electronic cigarette patent applications, accounting for more than 60%, and private enterprises are the main force of patent applications, accounting for nearly 90%.
As China's e-cigarette industry, which occupies global production capacity and technological advantages, has formed a very complete industrial chain in the upstream supply of raw materials, to midstream product design and manufacturing, and then to the layout of global market sales, and has become the world's largest export industry of e-cigarettes. 2021 China's e-cigarette industry exports about 138.3 billion RMB, an increase of 180% year-on-year, and is expected to remain in the next three years In the rapid development stage.
In the context of the standardized development of the domestic market and the prominence of the industry's export advantages, some industry insiders suggested that China's e-cigarette industry should increase its export efforts, strengthen international cooperation and promote open multilateral trade cooperation; call on the country to cultivate a better business environment for new manufacturing enterprises with technological innovation, support the growth and development of local enterprises, and avoid the mass exodus of advantageous industries.
The aforementioned tobacco experts also mentioned that China is the first major producer of e-cigarettes, the vast majority of e-cigarette products are used for export, domestic regulations may have a certain degree of impact on the export of e-cigarettes.
"Domestic restrictions on the taste and import restrictions on tobacco oil, will trigger reciprocal trade terms, other countries can also refuse to export domestic fruit flavored electronic cigarettes. The impact of the new regulations on future industry exports remains to be seen. At the same time, industry companies understand that domestic policies are at the stage of crossing the river by touching the stones and need to be constantly adjusted and improved, while national regulators should also listen to the opinions and suggestions of all parties in order to better serve the overall goal of 'national interest first and consumer's interest first'."