Yong-Hui supermarket: The power of fresh electricity manufacturers to create a vertical supply chain

Jiang Yiman

Yong-Hui supermarket has always been to fresh products, and in the overall recession in the retail industry, the company still maintained a positive growth in performance. Operating income and net profit rose 22.83% and 16.37% respectively in the first half of the year.

Like other retail companies, Yong-Hui supermarket also began to layout the business, a O2O app products have been promoted in Fujian Province to use.

Xuan, chairman of the company, said in an interview with "The First financial daily": "The development of the electricity business to the supply chain to do a good job, after the goods are sorted out, the electrical business started again." ”

Active distribution of fresh electric power suppliers in vertical supply chain

This year, Yong-Hui supermarkets to achieve operating income of 17.703 billion yuan, an increase of 22.83%, net profit of 453 million yuan, an increase of 16.37%.

"The overall environment is not very good now, but consumer demand has not diminished," he said. Same-store growth rate is more than 5%. So many years in the development, in the business has a lot of refinement and improvement of space, such as improving the display effect, the centralized procurement of goods and centralized marketing. This year's year-on-year growth has not diminished. "said Xuan.

He told reporters that the core of the company is mainly fresh food, committed to become a national enterprise. In the present situation, or in the existing area to do deep practice. Consumption has not diminished, but the way in which sales flow is changing. Fresh is the last area to be affected by the electric business, and it is also the slowest area.

In the long run, there will be some changes, after all, people's lifestyles are changing. How to use Internet tools to better connect goods and customers is a need to consider. After the company conceived to do fresh electricity business is the main city to do instant delivery, the county to do the next day delivery, open the entire line.

This January, Yong-Hui supermarket store app in Fujian 8 stores officially online operation, the app opened the payment link, not only can line up and down single, pay, offline delivery, offline shopping can also walk "mobile phone payment" channel.

It is understood that the company has set up a fast payment channel in 8 stores, the consumer purchases the commodity after scanning, may form the electronic small ticket, through pays the treasure, the handset binds the bank card line to pay, will generate a verification code, the consumer may realize by this number realizes the fast payment, does not have to wait in line.

Xuan said: "We are doing O2O related to small-scale operations, the core or commodity resources, it is important to build a commodity supply chain." O2O is to make full use of the supply chain of goods and physical stores to increase customer understanding. O2O to make, change is the way of consumption, but in the supply of goods has not changed, consumers look at the price of goods. O2O If you can realize the combination of entity and Internet, take the advantage of commodities as the main line, there should be a better space for development. ”

In his view, although the current market has repeatedly mentioned "internet thinking", but the Internet is only a tool, the key is to have a variety of good products to consumers, better connect the goods and services, to create a vertical supply chain is the consideration of this. If the global competitive goods can be procured effectively, the circulation supply and the system supply can be formed.

And with the milk group cooperation, is the Yong-Hui supermarket to create a perfect vertical product supply chain, one of the key steps.

This August, the wing FAI supermarket announced to Milk International Holdings Limited (60.38,0.00,0.00%) Sun Company-Milk Co., Ltd.-private issue of 813 million shares, Jian Yonghui Total equity of 19.99%, raise 5.69 billion yuan (about 925 million U.S. dollars) in cash.

Milk International was founded in 1886, from the earliest operating dairy products to focus on retail business in recent years, has now become a large-scale Asian retail enterprises, business throughout China, Hong Kong, Taiwan, Singapore, Malaysia, India, Korea and other regions.

The supermarket is one of the most familiar industries of milk international. In Hong Kong, the Milk International's Wellcome Supermarket market share of 39.8%, and Bojia with the Hong Kong chain supermarket industry, the two giants, both accounted for more than 70% of the market.

As of December 31, 2013, Milk International operates 308 supermarkets, 916 convenience stores, 366 health beauty shops and 3 household goods stores, and Mannings is a wholly-owned enterprise that consumers often see.

It is understood that the two sides will take equity investment as a link, to strengthen the strategic cooperation in global sourcing, food processing and safety, the development of self-owned brand products, high-end supermarkets, information technology and E-commerce, personnel secondments and training, can further reduce the company's procurement costs, enhance supply chain control capabilities, improve business operations management capabilities.

Xuan said there were four core elements in the partnership with the Hong Kong milk Company. The first factor to consider is the supply chain of commodities, because Chinese consumers have more and more high quality products to pursue, but there is no systematic and perfect support. Collaborate with them to share their global sourcing supply chain. Supply chain integration is ranked first. The second is the internationalization of Yong-hui is not enough, Milk Group management technology is still relatively advanced, including procurement technology, operating technology, display effect technology and so on. The third and fourth considerations are funds and brands.

"Milk Group supply chain of food or more in line with the yellow people eating habits, the second half of this year, the milk Group of goods and our procurement of high-end goods will come in, next year in large quantities come in." The company's own procurement can also go out, a single product out of a single product, goods in the supply chain to get through, straighten out, the electrical business started again. "said Xuan.

"From the current point of view, vertical supply chain is a more reasonable choice," said Zhiyong, a 500-strong enterprise Research Center at SUFE Shanghai Development Research Institute. In the absence of professional supporting enterprise services, vertical distribution is to build brand, improve quality, expand the size of the optimization strategy, but at the same time also faced with increased costs, operational efficiency is not high difficulties and risks. ”

He believes that Yong-hui's fresh electricity manufacturers represent the future development of fresh industries, the future of a better, more challenging, if Yong-fai in recent years can be the vertical supply chain operation mature, this will be the development of fresh electricity business one of the core.

Adapting to the rising trend of middle-class

Gradually increase the number of high-end stores

Yong-Hui supermarket since the inception of most of the store for the public, and in recent years, the company began to aim at the high margin market, the layout of the green label Shop.

"With the rise of the middle class, consumer demand for high-end imported products is growing, which is the starting point for us to open the Green label shop." "said Xuan.

Company said that at present, has opened more than 10 Green label shop, mainly from the management of operations to explore. Model has been relatively mature, this year also to open 10 dozen stores, the total will be thirty or forty next year Green label shop. These stores focus on Fujian, Beijing, Shanghai, Chongqing promotion, gross margin of 18% to 20%.

At present, Yong-hui supermarket cash flow situation is more stable. Xuan that, in view of the future of the economy will be relatively large changes in the hope that the node, there is ample funds, if the economic downturn in preparation, better than peers, then it is possible to achieve the trend of the contrarian expansion.

If mergers and acquisitions, what kind of business will the company consider?

"We would like to work with upstream enterprises to do collaborative development, if there are good planting enterprises, production enterprises, can be better close cooperation and promotion, we can provide customers with the data to them, so that they in front of the consumer to customize the appropriate products." Second, I hope to work with colleagues, and they through the data and supply procurement to share, to achieve a larger procurement, cooperation, monopoly distribution. "said Xuan.

Zhiyong that, from the data in recent years, Yong-hui development is relatively rapid, the level of profitability in similar enterprises in the forefront. Meanwhile, the pace of its expansion throughout the country has not ceased, Chongqing, Shanghai, Beijing and other core areas of the development is also relatively good, market demand, through mergers and acquisitions and other means also in the relevant areas of scale expansion, so, the overall wing-FAI development space is still very large, it is expected that the next 3-4 years will continue to grow at a high speed.

Reporter learned that, compared with other listed companies, Yong-fai to fresh as the characteristics of these years by seizing the development of the supermarket industry golden period, has formed its unique competitiveness. And the arrival of the era of fresh electricity, not only to face the challenge, you can also see opportunities, and choose to continue to focus on the main business, focus on the supply chain construction of these fresh electricity business "fundamental" company. Yong FAI can be full of competition, seize the opportunity to achieve a leap, let us wait and see.