Zong Fuli

My father taught me to endure hardship. But what I want to figure out is: why do we always have to endure hardship?

The Pepperdine graduate and the popsicle vendor #

Her father pedaled popsicles on a tricycle at age 42. She earned a Pepperdine degree before her mid-twenties. He never used WeChat. She launched a premium brand called KellyOne. He ran China’s largest domestic beverage company through handshake deals and personal visits to factory floors. She quoted international management theory and fired underperformers. The question everyone in China’s beverage industry asked — with varying degrees of hostility — was whether Wahaha needed a Kelly or needed another Qinghou.

Zong Qinghou (宗庆后, 1945–2024) built Wahaha from a borrowed ¥140,000 into a ¥78 billion empire — China’s richest man, a folk hero who defeated Danone in 29 lawsuits, and an autocrat who worked 18-hour days for 37 years without delegating a single major decision.

His daughter watched this performance her entire life. “My father taught me to endure hardship,” Fuli once said. “But what I want to figure out is: why do we always have to endure hardship?”

That single question contains the entire generational divide that would eventually make succession impossible.

The price of the family name #

Fuli returned from Pepperdine in 2004 and reported to Wahaha’s Xiasha production base in Hangzhou — not to an executive office, but to the factory floor. Her father insisted. The daughter of China’s richest man would learn the business from the bottom up, the way he had learned everything: through endurance.

Three years later, the education accelerated violently. In 2007, Danone leveraged its 51 percent joint-venture stake to claim ownership of the Wahaha brand and filed a $100 million lawsuit in Los Angeles naming Fuli and her mother as defendants. She was barely into her career. The lawsuit was ultimately part of the broader Danone-Wahaha war — 29 lawsuits across seven jurisdictions — that her father would win decisively. But for Fuli, the personal exposure carried a different lesson than the institutional victory. She had been sued for $100 million because her surname was Zong. The brand she might one day inherit had nearly cost her family everything before she had any authority to defend it.

The settlement came in September 2009 when Danone sold its stake for approximately €300 million. Her father emerged as a national folk hero. Fuli emerged with a strategic conviction she would spend the next fifteen years executing: build something you control entirely.

In 2007, the same year Danone filed its Los Angeles lawsuit, Fuli became president of Hongsheng Beverage Group — a Wahaha subsidiary she would quietly transform into a parallel empire. While her father continued running Wahaha through personal charisma and institutional loyalty, Fuli built Hongsheng into a holding company spanning 210-plus subsidiaries with 100-plus production lines, meritocratic management structures, and a commercial footprint worth more than ¥10 billion. She launched KellyOne, a premium juice brand targeting the consumers Wahaha’s mass-market portfolio could not reach. She negotiated directly with German equipment suppliers in seventeen-hour sessions conducted in English. She built, in other words, everything her father’s company was not: modern, data-driven, professionally managed, and entirely under her control.

The empire without an heir #

The succession was never formalized. Zong Qinghou ran Wahaha as an autocracy — every major decision flowed through one man. A famous internal anecdote captured the dynamic: “During the day, Zong Fuli would fire people; at night, Zong Qinghou would quietly invite them back.” He never resolved the tripartite ownership structure that made unilateral control impossible: the state held 46 percent, the family held 29.4 percent, and employees held 24.6 percent. He never disclosed the three additional heirs — children from a relationship with former Wahaha Party Secretary Du Jianying — who would emerge after his death to claim $2.1 billion through offshore trusts. He never prepared the institution for life without him.

In December 2021, Fuli was appointed Vice Chairman and General Manager of Wahaha Group. The operational transfer had formally begun. But the transfer of authority — the relationships with dealers who had followed Qinghou for decades, the political connections that made a private entrepreneur untouchable, the institutional memory that allowed one man to manage 30,000 employees through personal knowledge rather than systems — that transfer was impossible. Authority of that kind dies with its holder.

On February 25, 2024, Zong Qinghou died of lung cancer at Sir Run Run Shaw Hospital in Hangzhou. He was 78. The national mourning was extraordinary — millions of tributes flooded Chinese social media, and Wahaha’s Xiasha production base became an impromptu memorial site. Revenue surged to ¥70 billion that year, driven partly by a wave of sympathy purchasing that transformed AD Calcium Milk and bottled water into acts of national remembrance.

Fuli was named Chairman in August 2024. She inherited a ¥70 billion revenue stream, 81 production bases across 29 provinces, and a brand that 1.4 billion people considered a personal possession. She also inherited a governance structure designed for one man’s autocratic control, a workforce loyal to a ghost, and a secret that her father had taken almost to the grave.

Five months #

The assault came from every direction simultaneously. The state shareholder — Hangzhou Shangcheng District Wenshanglv Investment, holding 46 percent — questioned her management decisions and blocked strategic initiatives. An anonymous whistleblower circulated letters accusing her of embezzling state assets through Hongsheng. More than 600 employees formed a “rights protection committee” to oppose her reforms. Long-time dealers resisted changes to the lianxiaoti distribution system that her father had personally calibrated over three decades. And then came the inheritance claim: three previously unknown half-siblings — Jacky, Jessie, and Jerry Zong — alleged that their father had established three offshore trusts of $700 million each for their benefit. The $2.1 billion claim threatened not just Fuli’s personal stake but the governance stability of the entire enterprise.

Every decision she made was filtered through the fuerdai (富二代) label — “rich second generation” — a term loaded with contempt in Chinese public discourse. It implies that inherited wealth substitutes for earned competence. It suggests that the children of self-made tycoons are fundamentally unserious. For Fuli, who had spent seventeen years building Hongsheng from a subsidiary into a ¥10-billion-plus empire, the label erased two decades of work with two characters.

On July 15, 2024, five months after inheriting leadership of a company her father had spent 37 years building, Zong Fuli signed a resignation letter. She cited shareholder obstruction, employee resistance, and public questioning of her legitimacy. She wrote that it had become “impossible to fulfill management duties.”

She had a proven alternative. Hongsheng was hers — built by her, staffed by her people, generating billions in revenue under structures she controlled. She could walk away from the inheritance fight entirely and run an empire that did not require permission from a state shareholder holding a blocking stake.

Retreating in order to advance #

What happened next revealed both her strategic instinct and the limits of her position. Fuli made the resignation public. The letter leaked on July 18 and trended to 50 million Weibo views within hours. The timing was devastating for the state shareholders: the CCP’s Third Plenum was underway, championing private sector confidence and entrepreneurial succession. The optics of a state-owned entity forcing out a private entrepreneur’s heir during a week when the Party was publicly pledging support for private business were politically radioactive.

Public sympathy surged. Within four days, shareholders signed a “friendly consultation” agreement restoring her authority. The Chinese term for what she had done — 以退为进, retreating in order to advance — captured the maneuver precisely. It was a power play executed with the political timing of someone who had grown up watching her father weaponize public opinion against Danone.

Fuli used the mandate to execute the most aggressive restructuring in Wahaha’s history. She replaced old-guard board directors with Hongsheng-affiliated loyalists. She transferred thousands of employees to Hongsheng entities. She cut dealers whose annual sales fell below ¥3 million. She raised sales targets by 50 to 200 percent. She closed eighteen production bases. She merged administrative departments, introduced performance-based compensation to replace seniority systems, and launched sugar-free tea products to address the market segment Wahaha had ignored for a decade.

Revenue held at ¥70 billion — the strongest performance since 2014.

The strategic exit #

But the structural contradictions proved irreconcilable. When Fuli attempted to transfer 387 Wahaha trademarks to a company she controlled, the state shareholder blocked it. She launched “Wa Xiao Zong” (娃小宗) through Hongsheng, creating a beverage brand that directly competed with Wahaha’s portfolio — a move that laid bare the conflict of interest inherent in her dual role. The Wa Xiao Zong rebrand lasted 41 days before distributor resistance forced a reversal.

On September 12, 2025, Zong Fuli formally resigned all positions at Wahaha Group. Xu Simin succeeded her as General Manager. The $2.1 billion inheritance lawsuit continued in Hong Kong courts. The succession had failed by every conventional metric.

And yet. Fuli retained her 29.4 percent equity stake in a company generating ¥70 billion in annual revenue. She controlled 210-plus companies through Hongsheng. She had proven, during thirteen months of crisis, that she could stabilize revenue, professionalize operations, and execute restructuring at speed. Fortune named her to its Most Powerful Women Asia list for 2025.

“Regarding second-generation succession, it was never a multiple-choice question — it is a mandatory question,” she told Caijing magazine weeks before her final departure. “It means catching both the good parts and the not-so-perfect parts. Enterprise succession is also a form of entrepreneurship.”

The word she chose — entrepreneurship, not stewardship — is the key. Fuli did not fail to inherit an empire. She discovered that the empire could not be inherited, extracted the value she could control, and built her own. The founder’s charisma, relationships, and institutional memory died with him. What survived was the commercial logic of the system he built — and a daughter who understood, after five months of siege, that the strategic move was not to force control of an institution that could not accommodate her vision. It was to build an adjacent empire while the brand equity she had helped defend continued generating returns on the stake she retained.

Her father endured hardship because he had no alternative. She figured out why — and chose differently.

Last updated: April 5, 2026