China's 2008 milk scandal severely impacted its dairy industry. Afterwards, the government took prompt efforts to regulate and enhance food safety standards. For example, a dairy marketing management policy was implemented, and concentrated dairy complexes were recommended as options for smallholder dairy farmers. The results of this study show that the policies affected marketing channels at the farm gate. Since then, new dairy complexes have emerged and are becoming the primary marketing channel for milk. The marketing transformation has profound implications for food safety, and has strengthened vertical coordination in the Chinese dairy chain.