In the post-epidemic era, many uncertain factors exist in the market, leaving many offline physical retail companies facing an embarrassing dilemma with no solution. Under such circumstances, fortunately, Community Unchained has seen that a new phenomenon has emerged in the market, from actively embracing the private sector to actively embracing live streaming e-commerce, and then to instant retail. Community Unchained has also discovered that compared to the original traditional offline store opening model, "instant retail" with low cost, low risk and high potential is becoming the new growth code of the entire retail industry.
Retail tycoon’s “new password for growth”
The Double 11 promotion is currently in full swing, and JD.com said that based on JD Daojia and JD Hourly Shopping’s instant retail services of “online ordering, store delivery, and hourly and fastest minute-level delivery of goods,” this year’s Double 11 Within 10 minutes of the start of the sale, consumers in more than 500 counties, districts and cities across the country had received products delivered by JD Knight. And from 20:00 to 8:10 on October 31, on JD Daojia and JD Hourly, sales of electronic teaching products increased more than 10 times year-on-year; sales of egg gift boxes increased more than 6 times year-on-year; sales of pet health products increased A year-on-year increase of more than 4 times; sales of sports and outdoor, perfume and cosmetics increased by more than 2.5 times year-on-year.
The huge orders from major merchants on the JD.com platform have once again verified the imaginable space of instant retail. Similarly, Suning.com announced earlier that it has officially entered Meituan, and based on the latter's localized express delivery advantages, it has begun to provide users with instant consumption services including electrical appliances, 3C and other products. But taken together, it is clear that the strategic significance of Meituan’s acquisition of Suning.com, which has 9,749 stores, is far greater than its actual significance. Because, currently, from the perspective of instant retail consumer categories, there are mainly four categories: fresh food, food, alcoholic beverages and medicine, and these are not Suning.com’s advantage categories. So from this perspective, convenience stores that cover food, alcoholic beverages, daily necessities and other commodities have huge "win-win" opportunities.
In recent years, affected by the epidemic, more and more consumers have gradually become accustomed to ordering takeout at home. After all, compared with the current troubles of going to physical stores to scan codes (venue codes) and take body temperatures, coupled with the fact that now all walks of life It’s so tiring, especially for office workers who find it hard to have the energy to go shopping in physical stores after a busy day at work. But if someone gives them the 30 points they want, life will be much more comfortable.
Earlier, CCTV News reported the story of "A Grocery Store Owner's "Counterattack" with Monthly Sales of Millions". A couple born in the 1990s opened an 80-square-meter grocery store in Tongzhou, Beijing, and launched online takeout. Business, relying on the riders of major retail platforms, Xiao Liu’s supermarket can meet the needs of surrounding residents for daily necessities within 30 minutes. The service radius also expanded from 1-2 kilometers to 5-6 kilometers. Finally, the daily order volume of the grocery store increased by 3,000 orders.
In addition to the benefits of such mom-and-pop stores, many national supermarket chains have also enjoyed this wave of market dividends. Recently, a number of listed chain stores have also intensively released performance reports for the fiscal year or the first three quarters. The "instant retail" business of Sun Art, Yonghui Supermarket, Jiajiayue, Zhongbai Group and many other companies has become the biggest highlight in the financial reports. .
Sun Art Retail showed in its financial report that based on years of exploration and accumulation of digital upgrades, it has vigorously developed its home delivery business. As of now, offline, 80% of more than 600 Sun Art Retail stores have automated suspension equipment. Online, in the 2022 fiscal year (21Q2-22Q1 natural year), the average daily order volume of a single B2C home delivery business is 1,250 orders, a year-on-year increase of 12.5%. Calculated based on 602 stores, the total daily average is 752,500 orders/day, and B2C revenue accounts for The ratio reached 21.5%. Benefiting from the size of single-store orders (1,000 orders is the profit and loss point), unit price per customer (around 70 yuan) and gross profit margin (21-22% online), Sun Art's home-delivery retail business has achieved profitability.
Similarly, Yonghui Supermarket also stated in its financial report that the company continues to develop its omni-channel business and strives to polish the online and offline "warehouse-store integration" model. Driven by this, the company's overall revenue in the first three quarters reached 70.907 billion yuan, of which The company's online sales reached 11.6 billion yuan, a year-on-year increase of 16.35%, accounting for 16.4%. It is worth mentioning that the company's self-operated home delivery business has an average monthly repurchase rate of 51.7%. The third-party platform home delivery business has covered 915 stores, achieving sales of 5.3 billion yuan, and an average daily order volume of 210,000.
Li Songfeng, CEO of Yonghui Supermarket, also said in an exclusive interview with the media a few days ago that "integration of warehouses and stores" is a key to Yonghui Supermarket's profitability. This model can make better use of the original in-store infrastructure and significantly improve Reduce the investment cost of home delivery business, and you can rely on the platform's digital system to quickly replicate on a large scale.
Jiajiayue also showed in its previous financial report that so far the company has supported home delivery services in 511 stores, and its online sales and order volume have both increased by more than 80% year-on-year.
Similarly, Zhongbai Group, one of the largest supermarket representatives in Central China, also disclosed in its financial report that in the first half of the year, the company had significant sales on third-party platforms such as Duodian, Meituan, Ele.me, Taoxianda, and JD Daojia, as well as its own "Zhongbai Group". "Bai Neighbor" recorded a year-on-year order growth of 16% and a sales growth of 771.38%. Most importantly, the company's entire online business achieved a year-on-year sales growth of 23.28% in the first half of the year.
The true fragrance law of "instant retail"
In fact, it is not just a few supermarket chains that benefit from instant retail. From mom-and-pop stores to large supermarket chains, they have proven the huge prospects of instant retail. At present, the entry of leading companies such as Meituan, Ele.me, Hema, JD.com, Suning.com, and Xiaomi means that this new game will gradually become popular from the niche to the masses. And for all individuals or channel operators with advantages such as commodity supply chain, online e-commerce operation, private domain traffic operation and convenience store operation experience, they will have the opportunity to enjoy this wave of market dividends.
According to Qichacha data, in the past two years (2021.1-2022.10), there have been more than 250,000 new convenience store-related companies across the country. In addition, according to the "2021 China Convenience Store Development Report" released by the China Chain Store and Franchise Association, the number of convenience stores nationwide in 2021 will be 253,000, a net increase of about 60,000 from 193,000 in 2020.
The rapid development of the convenience store industry and the continuous intertwining and evolution of the e-commerce takeout market have made online convenience stores, mainly small formats, the largest experimental field for the instant retail industry. In this regard, Ding Jian, co-founder of "Near Pear Super Selection Convenience", said that he is more optimistic about the "Meituan Flash Warehouse" model compared to the convenience store model of physical stores.
According to Ding Jian, the selection logic of "Lightning Warehouse" is different from that of traditional convenience stores. Chain convenience stores are mainly located along the main streets, or in office buildings, schools, hospitals, train stations, and subway stations, while small supermarkets for couples choose a community. Keeping this community store open, the location selection method for operating a Meituan flash warehouse is to select locations from the perspective of coverage area through comprehensive data analysis. As long as the entire area conforms to the location selection logic, the store location requirements are low. , the store rental cost will be quite lower, and the location risk of a single store that does not rely on offline customer traffic is very small. Nowadays, the demand for online instant consumption is strong, as long as the operation is sufficient to maintain the convenient development of a pure online instant retail.
Ding Jian added that under the background that high-quality offline locations have been quickly seized by chain convenience stores, instant retail has provided new location selection logic and dislocated market competition space, and Suning.com has joined Meituan’s flash sales. Under the big platform, more people will realize that they can buy all kinds of goods on the Meituan platform. This will have a positive and positive effect on the development of Meituan’s instant retail, and it will also expand the consumer group for online convenience stores. The industry is deepening and new opportunities have emerged.
For most retail channel operators, all sources of business growth in the past depended on "location selection", and those stores with superior geographical locations have also begun to "go home." The era of one store selling to the entire district or city is over, and what is ushering in is the consumption trend of one warehouse selling to multiple districts (communities). This requires all merchants to not only integrate all stores and warehouses, but also actively embrace "warehouse-store integration" and fully integrate the existing and complete e-commerce infrastructure system by deploying more front-end warehouses, such as The super APP Meituan Flash Sale provides solutions for traffic, user mentality, front-end warehouses, express delivery, payment, user operations, etc., as well as the commodity supply chain provided by platforms such as Alibaba and Pinduoduo, as well as JD.com, Dada, Midea, etc. Instant delivery companies such as Group Delivery, Hummingbird Instant Delivery, SF Intra-city, Flash Delivery, UU Errands, and Linqu realize instant interception of consumers' daily consumption needs.
For all consumers, although the epidemic will affect everyone's travel to a certain extent, it will not have a great impact on normal daily food, drink, and housing. After all, in the new consumption era of "everything at home", it is possible to avoid crowding and not to gather in large groups. In compliance with safety and epidemic prevention management, online shopping can also greatly improve the comfort of life.
Of course, for all retail merchants, the gradual improvement of e-commerce infrastructure software and hardware will provide unlimited possibilities for all small and medium-sized players.