Retail Companies Choose To Slow Down To Catch Up With Emerging Markets

In fact, the days of Huarun Wanjia in 2014 were not very comfortable. According to the three quarterly bulletin published by Huarun founder (Huarun Wanjia parent company), its retail business has been losing money, and Tesco has become its "oil bottle".

All along, as the central enterprises, Huarun Wanjia is known as the "king of mergers and acquisitions" role in the domestic retail market, but the reform of big steps is few. Now it has also opened the road of self salvation.

At present, most domestic retail enterprises have chosen a slow pace to postpone or stop the expansion of business costs, but Huarun has gone against the market.

Compared with the previous two years, Huarun's strategy is also being adjusted.

According to Huarun's relevant person in charge, the newly opened stores reflect the two major business strategies of the company: first, form innovation.

The new projects have more breakthroughs in terms of format and mode of operation, such as V+ and O 'VAMOS; two, the channel sink, and the traditional stores (hypermarkets, shopping centers, etc.) accelerate the pfer to the three or four tier cities with lower cost and unsaturation.

Zhang Huawen, vice president of Huarun Wanjia, said that when foreign investment slowed down the pace of opening stores, Huarun 10000 plans to continue to increase sales efforts in 2015 to maintain steady growth momentum, but in general, Huarun's future opening strategy is to sink to the three or four tier cities in the Midwest and favor smaller formats.

"The route change is decided by the market. At present, the high-quality shops in China have become scarce resources, so Huarun tens of thousands of households take the form of channel sinking to intervene rapidly in the target market."

Zhang Huawen said.

The survey shows that in the case of large supermarket formats, the growth rate of the three or four line city stores is faster than that of the second tier cities in terms of sales volume and average daily passenger price growth rate. The growth rates are 4.2% and 4.5% respectively.

Today, Carrefour, WAL-MART and other foreign retail businesses expand in China, aiming at three or four line cities.

Yonghui supermarket has also infiltrated into the county seat, and 34% of the 161 shops planned to build are located in three or four line cities.

Reporters learned that in December 26, 2014, Huarun Wanjia opened in Jingdezhen store, Jiangxi.

Because of the unique geographical location of Jiangxi, it has become the key area for Huarun's Wanjia channel to sink.

Yang Yong, general manager of Huarun Wan Jiangxi, said that now that the three or four line cities are not saturated and the cost of opening stores is lower, Jingdezhen will be the pilot of Huarun's Wanjia channel sinking as the four line city.

If successful, the channel sinking strategy will be implemented within three to five years.

It is reported that in Jiangxi's Fuzhou, Ganzhou and Ji'an, before 2016, Huarun's 10000 stores opened to 9 stores, and in 2017 there was a private property shopping center in Xinyu.

In fact, from the perspective of capital strength, it is not difficult for Huarun to accelerate domestic distribution. The most important thing is whether we can "get a firm foothold" after deployment.

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The sinking channel will also encounter the common encirclement and suppression of local stores and some foreign capital stores with existing layout.

In the Jiangxi market, the "Southwest king" BBK group has been impregnated for many years.

In this regard, Yang Yong said that Huarun Wanjia is also prepared to actively seize the better location.

In the location of sunken outlets, Huarun's thinking is accessibility and visibility, in other words, the golden area where pportation is convenient and people can instantly find it.

"In the three or four tier cities, Huarun Wanjia is also choosing goods that are different from the second tier market, and the original cooperative businesses continue to cooperate and do a lot of persuasion."

Yang Yong said, for example, McDonald's is the first time Huarun has introduced it to Jingdezhen. Only when the interests of both sides are consistent, will the brand go along together.