Analysis Of China'S New Retail Industry In 2018: Early Warning Of Ebb Tide, Reduction Of Efficiency And Return To Retail Essence

Analysis of the development of China's new retail industry in 2018

Whether the traditional retail enterprises or the Internet companies from the online marching line, returning to the essence of retailing has become the reality that every "bureau member" has to face.

The development history of retail industry is the process of constantly changing and merging new and old formats.

In October 2016, the concept of "new retail" was led by Ali into the public view.

In just two or three years, Ali and Tencent are the two largest Internet giants.

The traditional retail giants also started to "seek prescription" actively or passively.

During this period, business innovation, capital influx and constant gimmick became the norm.

In November 2016, the general office of the State Council issued opinions on promoting the pformation of physical retail innovation, and made arrangements for entities retail enterprises to speed up structural adjustment, innovation and development mode, cross boundary integration, and continuously improve the supply capacity and efficiency of goods and services.

According to statistical data released by the foresight Industry Research Institute, China's new retail industry business model innovation and investment opportunities depth report, in December 2018, the total retail sales of social consumer goods totaled 35893 billion yuan, an increase of 8.2% over the nominal year, and an increase of 0.1 percentage points over November.

Among them, the retail sales of consumer goods above the quota reached 15084 billion yuan, an increase of 2.4%.

On the whole, in the 1-12 months of 2018, the total retail sales of social consumer goods totaled 380987 billion yuan, an increase of 9% over the previous year (the actual growth of 6.9% was deducted from the price factor, the nominal growth of the following except for special instructions), with a growth rate of 0.1 percentage points lower than that of 1-11 months.

Among them, the retail sales of consumer goods above the quota reached 145311 billion yuan, an increase of 5.7%.

Statistics and growth of total retail sales of consumer goods in China in 1-12 2018

Source: Prospect Industry Research Institute

But in fact, combing the movements of the major retail giants is not hard to find. Since March 2018, Ali and Tencent have virtually stopped buying and buying.

In the camp, there was also a figure of "ebb tide integration".

In addition to no convenience, the capital boom is fading. In December 2018, Yonghui supermarket.

Stripping Yonghui Yun Chuang has become a sign of a new round of adjustment in the retail industry.

As a trial of new retail sector, Yun Chuang business has seen a serious loss. Its accumulated losses in recent 3 years are nearly 1 billion yuan, and only 617 million yuan in the first three quarters of 2018.

This also brought Yonghui supermarket's net profit down 26.9%, the first decline in its performance in 7 years.

The cooling of the capital market has also reduced the "assist" of capital to new retail sales.

But the problem of low profitability in the early days of new retailing itself should not be overlooked.

Although every business change is beyond the industry's expectations, products and services are still the essence of practitioners' pursuit.

Whether the traditional retail enterprises or the Internet companies from the online marching line, returning to the essence of retailing has become the reality that every "bureau member" has to face.

Early warning of ebb tide

The "retail pformation" triggered by the box horse growth has evolved into a big Carnival in retailing.

In September 2018, Hou Yi, the fresh horse of the box, first disclosed the operation of the box horse fresh life in September 2018.

A total of 64 stores have been opened, covering 14 cities and serving more than 10 million consumers.

From the perspective of Ping efficiency, if it is a mature store (for more than 1.5 years), the daily sales of box shops will exceed 800 thousand yuan, or 50 thousand yuan per square meter.

The efficiency of traditional supermarkets is generally 10 thousand yuan / Ping, and from the perspective of Ping efficiency, the attempt of new retail has made a qualitative leap.

The box horse opens 64 stores in one year, which makes the retail enterprises unable to catch up.

High requirements for financial strength, team, talent, management, supply chain and operational capability are required.

Ali sank to heavy assets to do new retail, based on the strong support of Ali system.

These supports include logistics, service and technology.

According to the source of open orders, the online order volume of the box store reached 60%. In fact, in the middle of 2017, the online order volume of the box store was over the line.

At the customer price level, the online order price of the box is 75 yuan, and the line price is 113 yuan.

Specific to the monthly purchase of members, if members online and offline use box horse service, members spend 575 yuan per month.

Members who spend on pure line spend 279 yuan a month.

Members who consume under the pure line spend 228 yuan per month.

It is worth noting that the data disclosed are just the data of mature stores.

The box is currently releasing only a few data from the head, and the overall efficiency of the hundreds of stores is still not credited.

If there is a larger loss in the latter stores, it is likely to flatten the profits of the head store.

Compared with the original online profit market, the demand for capital in the early stage of online store establishment is higher.

Obviously for Ali's "heart treasure" box horse, the backing of funds is solid.

But with the current market rule, the capital recession period usually takes only 3-5 years.

For other traditional retail enterprises, if they rush and bet on "new retail", the consequences may be "bone and steel".

Yonghui Yun Chuang, as a new retail sector, has lost nearly 1 billion yuan in the past 3 years. Its losses in the first three quarters of 2018 amounted to 617 million yuan.

Faced with serious losses, Yonghui has been overburdened.

"Data and algorithm" for Yonghui such a traditional retail industry started a company, if we want to practice, we can not avoid long-term "heavy assets" investment.

Perhaps it is precisely because the short term can not see the bottom of the investment, Yonghui chose to stop in time.

When the new retail atmosphere is in full swing, Yonghui, with its powerful fresh supply capability, cuts into the catering scene from the business super scenes, extends the traffic volume and seeks high margin.

Through the "super species", the mix of high-end supermarkets and fresh food is positioned as light fashion and light luxury food.

At the end of 2017, Tencent invested 4 billion 680 million yuan in Yonghui supermarket, and was granted a 5% stake in the listed company.

Subsequently, 187 million 500 thousand yuan was added to "Yong Huiyun Chuang". After the capital increase was completed, the Tencent held 15% stake in "Yong Huiyun Chuang".

In the retail area, Tencent and Ali's confrontation upgrade, the super species comprehensive marking box Ma Sheng Sheng.

However, at the end of 2018, Yonghui had to face up to the reality of losses and peel off Yonghui Yun Chuang and stop the damage in time.

Insiders say that the influx of hot money is too eager for quick success and instant benefit, which is not necessarily a good thing for a reasonable business model.

Not all situations can solve problems by burning money.

Capital needs education, return to reason, and return to the internal logic of retailing.

We need to rethink how much revenue we can get, how much cost we need, how long it will take to find a balance between input and revenue.

Rapid capital input and rapid passenger flow.

In fact, consumers are smart.

For some consumers who remove the head, for most consumers, they value the money in their pocket and the cost performance of shopping.

Without subsidized dividends, other ways of consumption will naturally be chosen.

The false demand brought by burning money is not sustainable. "

The essence of retailing is still efficiency and efficiency, and the result is cost and profit.

In the era of retailing represented by Carrefour, retailers gain revenue through the way of obtaining relative costs from suppliers.

In the new retail era, Alibaba first made innovations by sharing the value with suppliers and sharing the product, so that the product development cycle of the supplier in the first 18-24 months can be shortened to 3-6 months.

Helping suppliers find the right new products and endow suppliers with value is also a trend in the future.

The industry analysis, for retailers, in essence, it is a setter, does not produce goods in itself.

With the electricity supplier, the value of the setters has gradually weakened. From the logistics setters to the setters of value, mining the value of retailers belonging to customers and producers is the core of the future retail pformation.

In addition, 7FRESH, Tianhong sp@ce are also crazy shop, in such a competitive environment, speed up shop speed, seize the lead advantage seems to become the main force of all parties.

The box store takes a new way of opening up shops to attract high-end customers, and puts forward higher requirements for time and quality.

In the radical expansion of the road, "tide maker" box horse also unavoidable problems.

In November 15, 2018, the "tagging door" of carrot's shelf date was revised in November 15, 2018. In December 11, 2018, the box horse fresh food was reported and listed on the list of Carassius auratus sold in the store.

Differential play

In the new retail melee, traditional foreign retail giants play differently, though they tend to be slow but steady.

WAL-MART's Sam member store launched the cloud storage project in 2017, to some extent, coping with the retail competition that has continued to sink into the community.

In fact, the attempt of cloud storage (front warehouse) has always been controversial in the traditional retail industry.

The front warehouse refers to the nearest and the most advanced warehouse logistics in the internal storage and logistics system of an enterprise.

The traditional logistics distribution pattern has been pformed from an electronic business platform + a courier company + consumer to an electronic business platform + front-end warehouse + instant logistics (or consumers), or front-end storage + consumers.

There are also some attempts in front of the box, such as fresh box, fresh fruit, daily life, Yonghui life, big RFA, Ali's retail outlet, etc., but only slightly different in form.

The box belongs to the storehouse, which is both a store and a storehouse.

The front warehouse of Verma Sam's member store does not have the function of the store.

It covers an area of 200~300 square meters, SKU is around 1000, and the location of the general location members is relatively concentrated. It selects members to purchase high-frequency and high permeable commodities, including fresh, mother and baby, personal care, dry goods, and net red snacks, snacks and snacks. It basically covers all fresh categories and provides 1 hours' extreme speed service for the surrounding 3~5 km users.

At present, the information is announced. Sam expects to have 10 or more prepositions in each tier city, and further improve the business through deepening cooperation with Jingdong.

For physical retailing, store performance is no longer the only criterion to measure performance.

Traditional retail stores regard stores as the fronts of brand, market, sales, delivery, warehousing and other processes, but for all channel formats, stores do not need to carry all the functions. Besides selling services, stores should also bring better shopping experience for consumers.

Based on this background, the traditional retail giants represented by Carrefour, WAL-MART and rainbow are speeding up the upgrading of stores.

Upgrade the offline shopping experience by adding new mother and baby room, interactive area and introducing star chef to cook food.

Different from the "heavy assets" strategy, the traditional retail giants appear more cautious and pay more attention to their own internal practice.

2019, the trend of increasing concentration of retail industry is irreversible.

There is no doubt that the current retail industry is still in the era of "the spring and autumn and the Warring States" and "a hundred schools of contention".

At present, the top 100 retail enterprises in China account for only 20% of the market share of the entity retail, while the top ten of the foreign retail enterprises account for 30% of the market share.

In contrast, the offline retail development in the US is relatively mature. According to public figures, in 2010, there were five seats in the world's ten largest retail giants, namely Amazon, Krogh, Costco, home depot and Target.

The highly developed offline retailing has also curbed the development of e-commerce.

On the contrary, China's total retail sales grew slowly, and the growth rate was less than 20% since 2009.

But with Ali as the representative of the electricity supplier to achieve the curve overtaking.

Back to the status quo of retail formats, online companies have obvious capital advantages, but lack of offline experience. Under the impact of online businesses, online stores are also facing increasingly difficult situations.

Many physical retail owners began to find it increasingly difficult to make supermarkets and sell assets.

Moreover, the trend towards the development of the global retail industry is also showing a tendency to increase the concentration of assets.

Mergers and acquisitions also play an important role.

After 2019, the concentration of the retail industry will also become an inevitable trend.

In the first half of the electronic commerce era (C2C), we should pay more attention to the flow of horse race and the B2C.

New retail giants are facing bottlenecks in online traffic growth, and they are beginning to explore the business mode of demanding traffic under the line.

From 2000 to 2018, the two core key words of the industry are the online upgrading of flow and brand. But at present, the cost of flow is rising, and the platform is facing a higher cost in increasing the particle size, resulting in a slowdown in the development of the brand line.

2017 is the most crazy year for Tencent and Alibaba.

Ali Suning department and Tencent Jingdong Department represent a new battle for the new retail layout.

At the beginning of 2017, Ali completed the privatization of Yintai, signing Shanghai Bailian Group, joining Shanghai Lianhua supermarket, Fujian New Hualian, as well as the blockbuster Gao Xin retail (big RH mart, Auchan), and investing in the home unexpectedly, completing the new retail layout quickly.

In December 2017, Tencent formally joined in Yonghui, and began to follow Ali's intensive efforts in offline retailing.

Rapidly expanding the battlefield, forming a collection of WAL-MART, Carrefour, Hongqi chain, Zhong Bai group, BBK, the United States, the daily excellent, Tianhong shares of the retail territory.

2018 social networking business is booming.

Social retail has the characteristics of low cost, diversified scenes and centralization.

Based on this characteristic, business community has in-depth analysis of several customer cases, and has made three new sections in the field of social business: social retail + social distribution + social marketing.

Retail sales will continue to focus on re purchase and efficiency in the post electricity business era after 2018.

In addition, population structure and consumption habits determine the direction of retail sales.

In addition, digital retailing, from the day of its birth, carries the imagination of value exchange and verification of the future.

From this year's digital process, it is easy to see that in the era of digital commerce, both manufacturers and retailers should shift their focus from past product thinking to customer thinking.

With regard to the re structure of people, goods and markets in new retail, scenario based thinking based on mobile Internet technology can enhance the stickiness of businessmen and consumers, and is also the most accessible digital way.

DDT also released research report, pointing out that the most fundamental change facing the retail industry today is that consumers' technology applications surpass enterprises, thus pushing enterprises to pform themselves to catch up with the new demands of consumers.

The digital platform can help enterprises reach consumers in an unprecedented way, thus bringing about a radical change in the competition mode.

The new retail business has been exploring for more than two years.

There is no fixed competition in the industry and the result is unknown.

However, whether Sam, box horse, or super species, 7FRESH, are all looking for "medicine", and now they are also on the combined track of opening stores and electronic business.

Despite its uncertain future, the new retail business has seen several ups and downs.

For enterprises, is the rush to advance or steady progress? The final answer still needs to return to the core of business, efficiency and efficiency.