Business Tycoons Scramble For A New Round Of Supply Chain Competition In The Same City?

After the electricity business occupied nearly 24.3% of the total retail sales of the whole society, the giants turned their attention to the blue ocean below the line.

In June 19th, the economic report reporters in twenty-first Century learned that Alibaba set up a retail business group in the same city. The business mainly includes the new retail sector of Tmall supermarket, private brand, Shang Chao and hungry, and is still in internal integration. Alibaba stakeholders did not disclose more details.

Prior to this, Suning and Jingdong have launched the same city retail format, Suning main Suning shop, retail cloud shop, Su Xiansheng, Suning supermarket and so on, and bought Carrefour China, playing a new concept of 1 hours living circle. Jingdong mainly supports Jingdong's home and 7FRESH Jingdong convenience stores. Since last year, the US group has begun to set foot in the line, and its flash buying business has been greatly increased during the epidemic.

The competing layout of giants has made the city retail a new opportunity for the second half competition of the electricity supplier industry. Dada Group founder and CEO Kui Jia Qi, in an interview with the economic report reporters in twenty-first Century, said that the rapid development of China's electricity providers in the past 20 years has brought about many excellent enterprises in the past few years. Even so, the retail industry occupies only 20% of the market share, and the remaining 80% will be the biggest opportunity.

The retail sector is testing the flow, performance and supply chain of the platform, and who can win it?

Targeting retail outlets

In June 16th, Jingdong came to the linkage platform of nearly 10 stores and many brands, opened the "618" big promotion. This year, the number of entity retailers participating in sales promotion is significantly higher than that of last year, covering more than three or four line cities. Data show that in June 6th -6 14 days, Jingdong sales increased 138.8% over the same period last year, and dada sent a total of 73.4% orders of distribution year-on-year.

Under the epidemic situation, real time retail plays an indispensable role in maintaining the stability of the consumer market and meeting the needs of residents' lives.

The advent of the epidemic has also accelerated the digitalization process of the offline retail industry. An investment professional told reporters on twenty-first Century economic report that most of the retail sales in the same city are concentrated in fresh, medicine and commercial super categories. The vegetable market is a high frequency transaction but has not yet found a better profit model. The drug is a nighttime demand and has no effect on consumers' consumption habits. Therefore, the key point of the platform is to pry the next super market. "Chain traders are super strong. As a platform, Jingdong can't get a higher commission than the US."

It is reported that the commission ratio of takeaway and net car industry is relatively high, the proportion of takeaway commissions is about 10%-20%, the proportion of net car commissions is more than 20%, and the proportion of commissions on ultra fast delivery platform is 5%-10%, most of which are around 7%. E-commerce platform for business super importance far exceeds the purchase of vegetables and drugs.

Dada group prospectus shows that from the business level, Jingdong related business is still the main force of dada net income. From 2017 to 2019, Jingdong contributed 56.7%, 49.1% and 50.5% net income to Dada respectively, while WAL-MART brought 4.6%, 13% and 14.9% net income.

After the listing, Kui Jia Qi said that Jingdong is still in the stage of investment. Jingdong's income comes mainly from the Commission, promotion fee and consumer payment. The expense is composed of riders' freight and subsidies to consumers.

However, at the same time, many merchants began to fight online, accelerating their digitization and transformation of electricity suppliers. In the first half of this year, the global retail industry was hit hard by the outbreak of the new crown pneumonia. The digital economic platform such as electricity supplier and live broadcast has promoted the retail industry to a certain extent. Statistics released by China's National Bureau of statistics show that in May this year, total retail sales of consumer goods totaled 31973 billion yuan, down 2.8% from the same period last year, a decrease of 4.7 percentage points from last month. In 1-5 months, the online retail sales volume of 40176 billion yuan, an increase of 4.5% over the previous year, 2.8 percentage points higher than that in 1-4 months.

Among them, the online retail sales of physical commodities increased by 33739 yuan, an increase of 11.5%, accounting for 24.3% of the total retail sales of social consumer goods. In the online retail sales of physical commodities, the consumption and consumption of commodities increased by 37% and 14.9%, respectively, and the wearing commodities decreased by 6.8%.

Mastering quality control and SKU's right to speak

It can be said that dada Jingdong's dependence on Jingdong and WAL-MART has laid the foundation of its supply chain in the past six years. At present, both the US group and Alibaba are targeting the shopping malls and supermarkets under the line, but it is extremely difficult to break through, because the electronic business platform needs to form the right to speak in quality control and SKU (inventory entry and exit measurement units). According to the twenty-first Century economic report reporter, the retail giant of 414 stores in the country will run to the vice president of Alibaba group and Lin Xiaohai, general manager of retail. Lin Xiaohai will serve as CEO and report directly to Alibaba CEO Zhang Yong. Huang Mingduan still holds the post of chairman of Gao Xin retail CEO and Da Yun FA China. According to the financial report, the proportion of Gao Xin's online business has reached 15% in 2019, which is nearly 90% higher than that in 2018. Gao Xin retail CEO Huang Mingduan said 2020 is expected to exceed 20%. After the adjustment of executives, it will further speed up collaboration with Alibaba.

According to the analysis of CICC, Gao Xin retail is expanding its cooperation with Alibaba, developing cat super shared inventory and community group purchase. It is expected to form a retail service network system covering all channels and multi scenes, and continuously enhance market share. "As Ali continues to strengthen its strategic position in the retail business of the same city, the future will not exclude the possibility of further deepening cooperation between the two sides."

For Alibaba, its integration is a series of resources under the offline retail, and the mode has also been directly selected from a single sale. However, there is still a certain threshold for the control of SKU. "Why did the US group and the hungry make tens of millions of orders for the takeaway scale, because the number of merchants SKU is low and the corresponding cost is low. But there are many commercial super products, basically hundreds of thousands of SKU, Carrefour, WAL-MART and other giant chains even have more than 20 thousand SKU. Commodity packaging takes longer time, and the picking cost has also increased a lot, which is also a test for the performance of the platform. A series of short boards such as shortage, packing, after sale and so on, still need a long time to make up. The foregoing investment bankers further analyzed.

At present, the offline business has also begun to work outside the platform, launching its own APP and small programs for online sales. According to Yonghui supermarket's earnings report, sales of Yonghui supermarket reached 3 billion 510 million yuan in 2019, an increase of 108% compared with the same period last year. As of the end of 2019, Yonghui APP and small programs have covered 24 provinces, with a monthly turnover of 5 million 60 thousand. In the first quarter of 2020, Yonghui supermarket reached 2 billion 90 million yuan in sales, up 2.3 times from last year. However, because of the expansion of superspecies burning money, it once made Yonghui Yun Chuang into a loss.

At present, even if the giants such as Alibaba and the US group join in, how to run the profit model and how to further upgrade and perfect the service is still the biggest problem for the platform and businesses.

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