Original xiangma new consumption 101
Author: Xiangma | Editor: Ge Weiwei
"Even if you are sealed as a’ God’, you can’t slack off."
Good article 3535 words | 6 minutes reading
The title map comes from the movie "The Richest Man in Xihong City"
As a Shangchao brand, Fat Donglai is hot now, but it is an undeniable fact that Fat Donglai’s self-operated supermarket has never left Henan or even entered Zhengzhou, the provincial capital.
However, in the eyes of Yu Donglai, the founder of Fat Donglai, geographical limitations no longer seem to be a problem-when asked if Fat Donglai would drive to Zhengzhou, he replied: "If you go to Yonghui, you will come to Fat Donglai?"
The background of this question and answer is that Fat Donglai launched a 19-day explosion reform of Yonghui Supermarket Zhengzhou Xinwan Plaza Store. The product structure after the reorganization of the latter reached more than 90% of the product structure of Fat Donglai, including moon cakes, craft beer, fruit juice, laundry detergent and other products with "DL" logo.
According to media comparison, these private brand products are priced the same as those in the self-operated supermarket in Pangdonglai. In addition, the supermarket’s dynamic line layout, equipment and facilities, service capacity and employee welfare are all comprehensively studied.
From the user’s point of view, Zhengzhou consumers go to the Yonghui store mentioned above, and the shopping experience is indeed similar to that of Fat East. From the industry’s point of view, their own brands have been sold to more places through the explosion of stores, breaking the previous geographical limitations of Fat East and further enhancing the competitiveness and influence of Fat East. Pang Donglai also admitted that the development of private brands should be "benchmarked against world-class standards".
Obviously, Fat Donglai is playing a big game of chess.
The power of a craft beer
First of all, thanks to the strong traffic and brand effect of Fat Donglai, the explosion-reformed stores that cooperated with it received good results after resuming business.
Taking Yonghui Supermarket Zhengzhou Xinwan Plaza Store as an example, local media reported that on June 19th, the supermarket opened for business. In just one minute, there was no vacancy in the queue entry area of "Jiuqu Ileum", followed by current restriction, purchase restriction and waiting for one and a half hours, but it still failed to reduce the enthusiasm of consumers.
Yonghui Supermarket revealed that Zhengzhou Xinwan Plaza Store sold 1.88 million yuan on the first day of business resumption, which was 13.9 times the average daily sales before the reform; There were 12,926 passengers on that day, which was 5.3 times of the average daily passenger flow before the reform. "The reform has achieved remarkable results."
Yonghui Supermarket after the reform, Tuyuan Yonghui Supermarket
It is worth noting that, according to reports, Fat Donglai did not charge any fees and did not involve any return. "And many costs such as helping the team’s salary, transportation and accommodation are all borne by Fat Donglai."
Then, the question is coming. What does Fat East want? The answer is four words: own brand.
Still taking Yonghui Supermarket Zhengzhou Xinwan Plaza Store as an example, a large number of self-owned brand goods from Pangdonglai have settled in, among which DL craft wheat beer can be called the "most beautiful boy" in the store.
You know, this beer is still sold out when one person is limited to one case. That night, the store had to announce that due to the excessive passenger flow during the resumption of business after the reform, in order to ensure customer safety, the sales of DL craft beer were suspended.
A craft beer broke out with great power, showing the strength of Pangdonglai’s own brand, not only in Yonghui Supermarket Zhengzhou Xinwan Plaza Store, but also in other explosive stores.
For example, the relevant person in charge of BBK revealed that in May 2024, the sales of Pangdonglai’s own brand goods accounted for 28.22% of the total sales of BBK Changsha Meixihu Store.
This store is the first BBK store in Pangdonglai. At the beginning of the explosion, BBK said that the store would introduce "20 popular products worthy of recommendation from Pangdonglai", including DL craft wheat beer, DL orange juice, DL enzyme sterilization and mite removal laundry detergent, DL instant oatmeal and so on.
Fat people from the east are popular with self-operated goods, and the new retail business review photo.
Fat Donglai’s own brand products not only attract consumers who go shopping in supermarkets, but also appear in the purchasing service of "Changsha helps buy fat Donglai goods", and its appeal is self-evident.
Behind the popularity of Fat Donglai’s own brand, Chengdu Business Daily learned from the media "Red Star Capital Bureau" that Fat Donglai’s own brand products are not produced by itself, but rely on different suppliers.
A supplier revealed that the specifications and proportions of these products are customized, and they are produced by Pangdonglai and suppliers, with exclusive formulas, "not simple OEM products".
According to Zhuang Shuai, the founder of Bailian Consulting, Fat Donglai has made its own brand an independent brand by "helping" other supermarkets and completed multi-channel expansion.
In other words, after this campaign, Fat Donglai is not only a supermarket retailer, but also a brand with insight into consumer demand and holding many popular goods. The combination of the two has enhanced the competitiveness and influence of Fat Donglai.
"God" is not omnipotent
In the past two years, the influence of Fat Donglai has continued to rise, but in fact, it has been well-known before.
As early as 2017, Lei Jun, the founder of Xiaomi, visited Henan and specially went to Xuchang Pangdonglai Times Square for "pilgrimage study". In the micro-headlines released at that time, Lei Jun pointed out: "Fat people come from the east, and the retail industry in China has always existed like a god …"
Look at the influence of Fat Donglai now, especially the sales record won by other supermarkets after the explosive reform, which makes Fat Donglai have the meaning of being deified.
Why is Fat Donglai deified?
The New Retail Business Review believes that it is because the founder, Yu Donglai, stuck to the bottom line and meticulously and deeply implemented the altruistic spirit. In Donglai’s own words, "the best marketing is sincerity, and the best service is goods." As long as we persist in sincerity and insist on selling high-quality goods, there is no reason not to succeed. "
These words seem to be "the truth", but in fact they are a kind of strategy, especially for developing their own brands.
This is because, if you develop your own brand, you can gain a certain cost advantage without middlemen to earn the difference, and you can also sell at a low price. However, if you blindly pursue low prices, you may ignore the control of product quality, thus undermining consumers’ trust in products and brands, leading to "voting with your feet."
According to Lianshang. com, relevant investigation reports show that high-income consumers are more picky about where to buy their own brand products, and about 65% consumers only buy their own brands from certain stores they trust. "As a strategic breakthrough point for the future development of the industry, solving the problem of private brand trust is the key."
How can we solve the "trust problem" Here in Fat East, the solution can be summed up as "insisting on sincerity and selling high-quality goods".
The aforementioned DL craft beer is evidence. Some netizens compared and analyzed that DL craft beer pays attention to raw material selection and brewing technology. The ingredients list only contains water, barley malt, wheat malt, hops and yeast. It is brewed by traditional German technology, and its body is full of aroma. In a word, it rejected "technology and hard work".
Tuyuan JD.COM
The same is true of fruit juice. For example, the packaging of orange juice indicates that about 15 oranges are used for squeezing, and no preservatives are added, only water and concentrated fruit juice are used.
In an internal sharing, Yu Donglai reiterated that selling things is real and frank. "You are thinking about the society, and the society also gives you back trust." The result of trust must be beautiful.
It is not difficult to see that through high-quality goods and sincere service, Fat Donglai has established a sustained and solid trust relationship with consumers, which is the underlying logic for its own brand to be strong.
However, on the other hand, private brands need comprehensive operation. Even if they come from the fat east and emphasize "sincerity" and "quality", it is impossible to play every product.
In fact, "Red Star Capital Bureau" visited many stores in Xuchang and found that "Fat Donglai has almost no price advantage in Xuchang" among many categories of goods and services.
In terms of expansion, there are still some fresh products that have a large loss, and some products are not very popular-this is also easy to understand. At present, there are about 20 popular products among more than 400 private brand products from Fat East.
For this reason, Fat Donglai needs continuous and refined operation, and needs to rely on popular single products such as craft beer to keep the overall gross profit margin of Fat Donglai in the range of 4%~5%. Compared with the gross profit margin of the retail industry, which is usually below 3% or even at a loss, Fat Donglai’s achievement is more eye-catching, but there is still much room for improvement.
From this perspective, "God" is not omnipotent. Like other supermarkets, we can’t slack off in products, services and comprehensive operations.
See clearly the ambition from the fat east
After reading the above analysis, we can say that there is really no need to deify Fat East, but it is necessary to see the ambition of Fat East by combing the development of its own brand.
It is worth mentioning that, whether in the self-operated supermarket of Fat Donglai or in the supermarket of explosive reform, the ambition of Fat Donglai is publicly visible. According to the slogan content of these stores, the development standard of Fat Donglai’s own brand is "benchmarking world-class standards, independence, innovation, quality traceability, environmental protection and sustainability".
New retail business review photo
Recently, Ji Zhongzhan, an enterprise development strategy consultant who went to Xuchang to visit Pangdonglai, also wrote that "the products from Pangdonglai are first-line brands selected according to EU standards, or they can make their own brands according to world-class standards".
In other words, Fat Donglai demands himself by world-class standards and is in line with world-class enterprises.
"It will come to a certain time and become a member of the best sequence of world business." In an internal management sharing in February last year, Yu Donglai said: "In some respects, you are excellent, and in some respects, you may not be as good as others, but in general, you are creating beauty. In the future, you will be able to influence outstanding enterprises in the world like Costco, Sam Member Store, Ito Yokado and Oleqi, so that there is no competition between them, and they are all good and benign interactions with each other."
Taking these remarks apart, we can see that Costco, Sam member stores, Ito Yanghuatang and Oleqi are all deeply cultivating their own brands.
In the 2023 China Shangchao Private Brand Case Report issued by China Chain Store & Franchise Association, 10 private brand star commodity development cases from Shangchao and convenience store enterprises were selected, including Costco, Sam member store and Ito Yanghuatang.
As for Oleqi, it is one of the world-renowned low-priced supermarkets and pioneers of its own brand model, with 57 stores in Shanghai, which has a profound influence.
The long-term goal of Pangdonglai is not only to be in line with these "excellent enterprises in the world", but also to influence them in the future, to influence outstanding enterprises with world influence, and to jointly promote good business.
At this point, the big chess that Fat Donglai is playing is gradually clear. The question is, can it achieve the expected goal?
The development of private brands and the leap of influence can help achieve the goal, but the final result needs to be "double verified" by the market and time.
References:
1. "Fat Donglai" revolutionized Yonghui, and its sales increased by 13 times ",Spicy with chopped pepper.
2. "Fat Donglai" Helping "Shangchao: Exporting its own brand, a supermarket and a supplier", Red Star Capital Bureau
3. "Fat Donglai" Explosive Reform "Yonghui: A Win-Win Experiment in the Spotlight", Southern Weekend
4. "I wish the society more fat people from the East and less Xu Jiayin", the old chair coach.
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Original title: "Fat East is not omnipotent"
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