How do merchants do instant retailing？ One article clarifies the controversy and value.

Produce/browse the business

Author/Xue Xiang

Recently, two real-time retail data have attracted the attention of a glance at business.

One is that in a recent sharing, Xu Lingna, general manager of over the rainbow Lingzhi Mathematics Department, revealed that online sales in over the rainbow have soared in the past three years, accounting for nearly 30% of the total, while 20% of online sales in over the rainbow actually came from the time when stores closed from 10 pm to 9 am the next day. That is to say, the online instant retail in over the rainbow not only transferred the offline sales to online, but also obtained additional orders.

On the other hand, according to the data of China Chain Store & Franchise Association, in the past year, 67.2% of convenience store visitors decreased compared with last year, but in the case of declining passenger flow, the overall sales of convenience stores changed in the opposite direction. In 2022, the total sales of 64.1% convenience store enterprises still increased year-on-year, one of the main reasons was that they did instant retailing.

Actually,Both over the rainbow and convenience stores are the first batch of instant retail players, and they are pathfinders who have made achievements. Nowadays, more and more platforms and businesses begin to enter this track, and the industry has more and more different views on it.

dispute

Everything is divided into two parts, and the growth of any new thing is accompanied by controversy, and instant retailing is no exception.

After communicating with a number of retail industry practitioners, a glance at the business found that merchants’ worries about instant retailing are mainly reflected in the impact of mature retailers on husband and wife department stores after entering the network, as well as the order distribution of ordinary stores and pre-warehouses. The first batch of instant retail stores have made profits, so it is time to clarify the causes of the dispute and seek solutions.

Online retailing is the true mapping of offline commerce, and the competition between Shangchao convenience store and couples grocery store will certainly exist for a long time.

Consumers are used to online consumption, and this habit is irreversible. As the data at the beginning of the article shows, in the past year, the passenger flow of offline physical stores has been affected, and couples department stores are no exception. When supermarkets, convenience stores and other mature formats, relying on their own capital, technology and traffic advantages, transform to online in advance, the pressure on mom-and-pop stores is even greater.

Indeed, in front of offline mature retailers such as supermarkets, convenience stores, collection stores and discount stores, mom-and-pop stores will naturally be considered weak. At the same time, take-away food has a wider range of radiation, and stores in different blocks are likely to be placed on the same plane for competition. Therefore, it is easy to think that the online increase of supermarkets and convenience stores is obtained by seizing the market share of mom-and-pop stores.

This view has some truth, but obviously underestimates the vitality of the mom-and-pop shop.

First, instant retailing, no matter how to expand its business scope, will not let small stores compete with national brands, which is a local format after all. As long as it belongs to local retail, there will always be a place for couples’ shops, and no one knows the local ecology better than them.

Second, mature retailers often come into contact with new models more quickly, and competition will return to the same starting line after couples’ department stores join instant retailing. With the help of various online business tools, community stores can gain insight into demand faster and stock up flexibly.

Regarding the competition between ordinary stores and front warehouses, we believe that the two formats are dislocation competition and can coexist completely.

Whether it is an "amphibious" store or an online store, it is formed under the impetus of the outbreak of demand and the prosperity of supply. The core of instant retailing is local supply, and consumers will feel convenient only if the coverage rate of businesses in a certain area reaches a certain standard. Taking Meituan as an example, before the launch of new supply projects, some merchants started the pre-warehouse business spontaneously.

Besides,In a glance at the business, this kind of "pre-warehouse" and offline-oriented community stores, although there is competition, are more of a misplaced competitive relationship.

For these small shops, the front warehouse does not have the offline sales function, and many online orders of small shops are the increment brought by expanding the business radius, which does not affect the offline business. Consumers who used to visit small stores may also increase their shopping frequency because of the "home delivery" service. For community stores, the setting of online "starting price" will also increase the unit price of customers.

No matter in terms of product selection, service mode or customer acquisition method, the husband and wife shop can well adapt to the local people’s life and consumption habits, and can also be connected to the community group purchase to become a "group leader", flexibly expanding more convenient services, including making breakfast, receiving express delivery, printing faxes, weighing, and even walking dogs instead of surrounding residents.

value

The above problems mostly point to the possible competition between instant retailers. A glance at the business believes that online and offline integration is an inevitable trend. Instead of worrying about competition and opposition, businesses should study how to adapt to changes and give full play to their comparative advantages.

At present, instant retailing originates from the elimination of instant consumer demand. Thanks to the development of physical retailing in China, both the supply and demand sides are in the stage of increasing and expanding. As the report of the Ministry of Commerce recently predicted, instant retailing will cover more application scenarios.

First of all, the epidemic, e-commerce, pre-warehouse, and community group buying have made consumers more lazy. Changes in consumption habits have forced physical retail to enter the network, making home delivery a retail standard.

Secondly,The theme of retail has always been to reduce costs, improve efficiency and make consumers get more convenient services. The essence of the Internet platform is connectivity, which can match transactions by reducing the information gap. This is the case with the most prosperous online e-commerce in the past two decades. The traditional e-commerce supported by social logistics has become the Red Sea, and instant retailing is a new opportunity for physical stores, the main body that failed to profit from e-commerce in the past.

Finally, the first wave of merchants who have joined instant retailing have begun to get dividends, and the speed of merchants accessing the network will be faster and faster. Taking convenience stores as an example, the take-out ratio of the head stores of Henan Yuelai Yuexi can reach about 30%, which probably brings about a 50% increase. Instant retail orders for fresh food in Wuhan Today convenience store increased by 90%. At first, online orders were only 2,000+a month, and now there are more than 10,000 orders a month.

Wu Teng, vice president of Hebei 36524 convenience store, told a typical example. There are seven stores similar to them on a street in Shijiazhuang, and the latest order they took over was placed 30 meters across the road, and the delivery distance was no more than 100 meters. They bought iced drinks and snacks. If they don’t provide instant retail, this order will definitely miss them.

Under such circumstances, only doing a single channel has become a disadvantage. Even for large-scale chain retail enterprises, the outlets are dense enough, but it is inconvenient for consumers to come out or even want to come out, so they can only watch the orders fly away.

Therefore, a glance at the business believes that,For businesses that have set foot on instant retail ships, we should continue to adhere to and operate for a long time. For businesses that have not started to do instant retail online, we should shelve the debate and actively transform with reference to the operating experience of the first wave of online businesses.Moreover, from the commercial point of view, joining at this time also has advantages that the first wave of mature retailers do not have.

On the one hand, after years of development, the instant retail platform has developed a perfect digital system, which can enable small-scale community stores and small supermarkets to quickly access the network at low cost, saving a lot of technical investment;

On the other hand, the change of consumer habits means that the early stage of consumer education has ended. At this time, going online can not only expand the coverage of small stores, but also reduce the marginal cost of rent by adding new orders.

In addition, local supply is the foundation of real-time retail, and the key for physical stores to do real-time retail is to keep up with the real-time needs of local consumers. This is also a huge advantage for the mom-and-pop shop, which is already in the community and familiar with the surrounding environment.

Finally, let’s look at a set of news:

This year’s No.1 Document of the Central Committee mentioned instant retailing for the first time, pointing out that "the construction of county commercial system should be comprehensively promoted. Accelerate the improvement of county and rural e-commerce and express logistics distribution systems, build county-level collection and distribution centers, promote the integration of rural passenger and postal services, and vigorously develop new models such as joint distribution and instant retail. "

According to the estimation of China Chain Store & Franchise Association, from 2020 to 2021, the annual growth rate of instant retail will basically remain at 80% to 100%.

Obviously, the development of instant retailing is the general trend. Although there is some controversy, everyone is more worried about the possible uncertainty.

Throughout the history of human development, there are many uncertainties, but in the history of instant retailing, at least the achievements of the first wave of merchants such as supermarkets and convenience stores are certain, and the operation mode is also certain, so is the widening of the operating radius of mom-and-pop stores.

A glance at the business believes that the essence of instant retail is retail, so it is still a long-running business, and we can’t just look at short-term disputes. As long as merchants are good at tapping the unmet needs of offline and traditional e-commerce, as long as they turn traffic thinking into cost thinking, serve residents well in a limited radius and ponder over details, they can see more certainty in the instant retail field.