Chengdu Red Flag Chain Buys Local Brand Hongyan Supermarket

21 days after the suspension, the Hongqi chain announced in the evening of March 17th that the company used its own capital of 238 million yuan to acquire the related assets of supermarket in Chengdu Hongyan supermarket (hereinafter referred to as Hongyan supermarket), including logistics distribution center, 125 stores and related facilities and equipment, and signed the agreement on asset pfer in March 17th.

In an interview with reporters in March 17th, Cao Cengjun, the red flag chain manager, said that before the merger, the Hongqi chain supermarket already owned 1600 stores in Chengdu and its surrounding areas, but the coverage of the two or three tier market in Sichuan was not enough.

The layout of Hongyan supermarket stores is complementary to Hongqi chain network.

The red flag chain is famous for its Zhongnanhai supermarket which has been operating for nearly ten years in Zhongnanhai, but the supermarket was closed by March 14, 2013.

According to public information, the red flag chain was established in 1993 and went public in September 5, 2012. It became the first A chain market to facilitate the listing of supermarket chains. Its operating income in 2014 was 4 billion 764 million yuan, the largest chain supermarket in Chengdu.

According to local media reports in Chengdu, Hongyan supermarket has more than 125 stores before the red flag chain mergers and acquisitions. About 50 shops are located in Wenjiang, while others are distributed in Pixian, Dujiangyan, Ya'an and other districts and counties.

Two or three line city.

The company has a total of 30 thousand square meters of logistics distribution center, Hongyan enterprise headquarters complex, the Yarlung Zangbo five star hotel and so on, with more than a thousand employees.

Although the size of Hongyan is not large, it can also optimize the layout of the Hongqi chain at present, and the layout of Hongyan supermarket also covers the currently popular tour routes in the country.

"Because the tourism industry is also a dominant industry in Sichuan, to seize this retail market is not only able to export red flag featured products, such as Sichuan local specialties, but also to the whole country and even the rest of the world through tourists. It can also bring the high-quality and special products of tourist attractions into the red flag chain and enrich the sales category."

Cao Cengjun said.

Another important purpose is the implementation of IMP (integrated service platform) and O2O strategy.

In December 2014, the red flag chain IMP new service platform, through the IMP platform "electronic shelf", consumers can browse to all the red flag chain products, and make the order.

Consumers can choose to shop from stores or stores through electronic shelves.

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Hongqi hopes to join the platform of Alipay, WeChat and BOC, and combine the advantages of 1600 outlets in the next line to build a localized O2O platform.

"The original intention of IMP is to serve the local red flag customers. However, with the marginal cost unchanged, increasing the coverage area and increasing the layout of the network will bring greater economic benefits to the company."

Cao Cengjun said.

In addition,

After the first acquisition after landing in the capital market, Hongqi chain hopes to get out of the Sichuan market and expand outward experience through this merger and acquisition, and accumulate some experience in mergers and acquisitions.

"We will continue to start from Sichuan and choose some chain stores with good management standards and good operation to continue to merge."

Cao Cengjun revealed.

The reason why we choose to implement this acquisition plan at this time is that the retail sales in March and April are generally off season. With the addition of 125 new stores, there will be a period of adjustment. In the coming week, the red flag chain will unify the recruitment and training programs of new stores, and integrate the new outlets into the overall layout of the red flag chain as soon as possible.

According to the plan of Cao Shiru, chairman of the red flag chain, 3 years after the listing, that is, in 2015, it will increase from more than 1200 to more than 2100 in the Sichuan store. The acquisition of Hongyan is a step forward from its pre-set goal.