Sinking to small business state resources million family scheme of fresh electricity business

Eat Tesco just whole picture, relying on their own strong brand advantages, and then to "Small business" attack breakout, China resources million to the full reach of ordinary people living tentacles, thus forming a complementary business chain closed loop.

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Wen/Zhang Shule

Published in the March 2015 issue of Business Review

Under the impact of e-commerce shocks, physical retailing has become less sexy today. At the core of this change, as one of China's largest retail groups, the success of the transformation of Huarun million, in a sense also represents the future trend of China's physical retailing industry.

February 8, China Resources million announced the launch of the new red "Huarun million" brand logo, the new logo will be replaced by the China Resources million and Tesco (Tesco) joint venture company's existing logo of all stores.

The retail giant, which already owns 4,127 stores in the Chinese market and sold $104 billion in 2014, has entered the era of "late" new layouts-a supermarket downstairs.

Eat a Tesco: It takes three years to digest?

Admittedly, Huarun million is a behemoth, even if not eat Tesco.

Data show, as a 30-year retail experience chain supermarket, 2014 Huarun million national self-owned stores to achieve sales of 104 billion yuan, the total number of self-stores reached 4,127. Huarun million has entered the national 31 provinces, autonomous regions, municipalities and special Administrative regions, 264 cities, the number of employees more than 300,000. Its more formed by the China Resources million, Suguo, Ode to Joy, China Resources Hall, Ole ', BLT, Vango, voi_la! , vivo mining, Pacific Coffee and many other brands.

In October 2014, CRC's parent company, China Resources, and the world's third largest retail company Tesco Group signed a joint venture agreement. Tesco shares a 20% stake in the joint venture with 134 stores in China and 19 shopping malls and cash of HK $4.325 billion.

According to Hongjie, the CEO of Huarun million, China resources million has become the "largest supermarket chain in the mainland." The analysis predicts that the sales revenue generated by the two sides will be the sum of the operating income of Wal-Mart and Carrefour in China.

The exchange of marks, in a way, is also to congratulate the merger of the "occasional" move. Hongjie said that this is the opportunity to connect with international practice.

However, this merger is seen in the industry as a 1+1<2 rhythm.

A direct evidence is in China Resources 2014 third quarter performance report, by the Tesco store losses affected, retail business China resources million loss of 700 million yuan.

The reasons for this result are manifold, and one of the key points lies in the right and left side beats of two.

Tesco, who entered the Chinese market in 2014, has experienced a high-speed open-shop period. In 2007, Tao, the chief executive of Tesco China, said: "200 stores in 5 years. "At that time, Tesco had 90 stores in Warsaw Pact, which opened 22 new homes a year to meet demand. In the process of high-speed expansion, a large number of stores because of inappropriate location, the goods do not meet the needs of local consumers, such as the urgency of the state of emergency off.

China resources million has also gone through such a detour. The media reported that China Resources recently closed three stores in Shijiazhuang, Hebei Province and Tangshan. In eastern China, some Tesco stores have been forced to close.

Similar detours also lead to store stacking problems. For this reason, China Resources million vice president, East China President Zhang Huawen said: "After the acquisition of Tesco, in a street can not and need to open two stores at the same time." "This is a solution and a key issue that must be addressed after the merger."

Slimming became the main digestion after the merger, and China Resources plans to spend 3 years to complete the Huarun million and Tesco in all stores in the country docking and integration.

But in the process of slimming, the focus of China resources is not in large stores, and its acquisition of Tesco's reason is really open ...

Small business: The supermarket downstairs is coming.

In the merger and acquisition of Tesco, the real layout intentions of China Resources is also unfolding, on the surface, and merger Tesco does not have much overlap.

In 2014, professional stores, supermarkets and department stores grew by 5.8%, 5.5% and 4.1%, respectively, but fell 1.7, 2.8 and 6.2% respectively from the previous year, the National Bureau of Statistics. It is clear that the entire traditional retail industry has entered a slowing growth period.

But in the last year, China Resources million has been the trend of expansion, a total of 65 hypermarkets (not including Ole ', Vango, etc.), 14 of the company opened, the market gradually to three or four line city infiltration. On the surface, the way of China resources is not much special, previously Tesco also had the same operation, belonging to evade in the first-tier cities and the industry to compete in the hot, into the three or four-line city to tap the new blue sea not covered by the electricity business.

However, in the actual operation of the formula, the center of China Resources to sink to a lower, hypermarket is only the vanguard of China Resources strategy.

The strategic intentions of China resources are already in the first-tier cities, in the hypermarkets gathered a considerable brand energy, and then radiation to other China resources brand. According to the intentions of Huarun million, the future of the market in the first-tier retail stores will mainly show the characteristics of the downsizing of the industry. such as January 27, China Resources million to its retail brand "Vango" as a pilot, in Hangzhou opened the country's first "new generation of Vango convenience store."

According to media reports, the new generation of Vango convenience stores has increased the proportion of fresh food products because of the surrounding existing residential areas and commercial offices. 126 square meters of space, in addition to the common steamed buns, soy milk, Oden, Bento, customers can buy in the new generation of Vango convenience store in the freshly brewed coffee, including American, latte and other 6 kinds of classic taste. In combination with the surrounding business district office and the demand of single apartment consumer groups, the new store has increased the number of household goods (edible oil, spices, etc.). In addition, there are mobile phones, traffic violations, water and electricity, digital TV, such as China's number of payment services.

Obviously, such a layout is no longer the traditional retail model, but it becomes a kind of ground gas community living space. According to the shop location to tailor-made, in fact, China Resources "small business" concentrated performance.

Vertical, functional and miniaturization is the basic characteristics of small business, but it is obvious that China resources want to do in its large stores after the formation of the brand, and then use the "small business" attack into various business circles, a targeted layout, to provide convenient living services, the radiation hit farther, forming a complementary and collocation of the commercial chain. Can be regarded as a "kiosk" upgrade version, can also be seen as a drag N supermarket group combination.

In the one or two-line city's brand power has matured today, the "Small Business" layout of Huarun million is bound to form a rapid replication, while the three or four-line city, the replication of the first-tier city of the module, starting from the big stores, so reciprocating cycle. Mergers and acquisitions Tesco is not so much the expansion of the overall store volume, rather than in the vacuum zone of Huarun million, directly to the original brand of Tesco's energy to realize, faster to achieve a "small business" new layout, as a catalyst to speed up the mode of "copy" cycle.

In this way, the size of the combination of the purpose is to adapt to the young people of this consumer group of new consumer demand. In particular, for the intrusion of electronic commerce, to carry out differentiated merchandise sales. In short, it is difficult to sell the network directly to provide life services, especially in the exploration stage of the current, insert a variety of business district of China Resources "small industry" can become the closest supplier of life services, or consumers downstairs supermarket.

On this basis, the e-commerce strategy of China Resources million will follow.

Fresh partner: E-commerce land

According to the layout of Huarun million, according to Hongjie Introduction, February 6, huarun million brewing has long been the e-commerce platform "E million home" began to the internal staff of China Resources department Open, and in Shenzhen, because the China resources million in Shenzhen distribution system more perfect, can be combined with China resources million supermarket, community shop for the whole network straight send. If it goes well, it will be officially launched in March this year.

This is not the first time the China resources million electric shock. As early as November 2004, Huarun million home on the online e-commerce platform "million Moore", but mainly services in Hong Kong, China, Macau. Since 2009, the mainland and overseas businesses have gradually expanded, but by 2013, the million Moore e-commerce platform ceased operation. The main reason for failure is the same as other entity retailers, between the physical stores and e-commerce too tangled, not only did not form a complementary, but the formation of left and right mutual beats.

The re-war e-commerce, seems to have fallen behind the other layout of e-commerce retailers are far away from the Huarun million, the strategy is clearer, the flagship fresh management, self-built logistics, stores will also become a pick-up point. Last July, the so-called "fresh partner" system was introduced, that is, to enhance the enthusiasm and performance of the mall's employees through partnerships with fresh employees, and to share the economic rewards of excess performance with employees.

Allegedly, at the end of last year, about 100 stores in the South China Resources million, which created an excess profit of about 6.5 million yuan, of which nearly 3 million yuan has been distributed proportionally to the corresponding employees as a bonus.

And this is a fresh-based e million home of an important foundation. It is not difficult to see, in fact, China Resources e-commerce project, in essence, is a raw and fresh such traditional network shopping channels are still difficult to expand the field of expansion, relying on their own huge store shop as a support, carried out by the emphasis on the type of life service projects.

Cold chain logistics, in the present, is still the traditional network purchase power is not caught. Even if the logistics is effective, but how in the customer is not in the situation, will be fresh to keep in the pick-up point, and ensure that customers do not go bad before picking up? Just this one problem is enough to choke the neck of a fresh e-commerce. While China resources has advantages, huge store coverage and the upcoming "Small Business", coupled with "fresh partners" inspired by the staff initiative, it is easy to crack the last mile of fresh electricity business problems.

Each of the radiation to a specific business district of China Resources "small industry" stores, can become a pick-up point. Customers before and after the online purchase, the local Huarun million stores fresh partners will communicate with customers, and to carry out distribution, at the same time rely on self-built logistics will be fresh express to the nearest customer "small business" stores, and stores equipped with fresh storage equipment, is enough to ensure that customers any time to pick up the goods are fresh enough. As for the online payment or cod, there is no suspense. Once this layout is true, a complete form of fresh and self-distribution is formed.

As mentioned above, mergers and acquisitions Tesco, just can speed up the "big stores + Small Business" layout speed, speed up the coverage capacity, which constitutes the future layout of China Resources, a series of a chain, interlocking.

On this basis, other e-commerce projects may also carry out similar patterns of "duplication", especially the current traditional e-commerce and life services, such as the soft rib, such as food ordering business. As for the experience and network of Tesco's original e-commerce system, it can be regarded as an effective supplement by using Tesco's differentiated advantage in its own goods and cost-effective imported goods.

"Diversified consumption demand, become the retail enterprise diversification development of the important reason, whether to grasp the diversified consumer demand, has become the retail enterprises diversified development success or not key." "Hongjie said.

But the problem still exists, the huge volume of China resources and large-scale layout of the stores, logistics, etc., will constitute a huge cost pressure, this pressure on the price of goods above the above, the foregoing advantages will suddenly become mist.

How to break, but also to wait for the practical action of China resources million home.

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Sinking to small business state resources million family scheme of fresh electricity business