Source: Third Eye Retail Author: Chen Xingxing
Xi'an is experiencing the most serious round of the epidemic since the lockdown of Wuhan in 2020, and "difficulty in buying vegetables" after the closure management has also become the key word in this epidemic.
Since the lockdown on December 23, 2021, Xi'an has quickly identified three batches of hundreds of supply enterprises. At the same time, it has established a collaborative supply guarantee platform with six provinces such as Anhui, Shandong and Guangxi to ensure the supply of people's livelihood.
According to data from the Xi'an Bureau of Commerce, the daily market volume of vegetables in the city during the epidemic period can reach 13,000 tons, and the government reserves 25,400 tons of vegetables. The normal daily consumption of vegetables in Xi'an is about 3000-5000 tons, which can fully meet the market demand. At the same time, Yonghui's vegetable, rice and noodle reserves in Xi'an reached 1,400 tons; the materials transferred by Hema from Shandong and Henan were delivered on January 1; and Taocai cai also transferred 2,000 tons of daily necessities to Xi'an. Data from all parties prove that the supply of civil and biological resources in the Xi'an market is basically sufficient.
However, since the "lockdown", the discussion on the issue of "difficulty in buying vegetables" in Xi'an has never stopped. This topic even once appeared on the Weibo hot search list, and relevant government departments have also responded to this topic many times.
As a key part of ensuring people's livelihood, responding to emergencies and ensuring basic consumption supply is a capability that retail enterprises need to have. Especially in Xi'an, where retail formats are abundant and there are many mainstream retail enterprises, and the supply of upstream materials is basically sufficient, the problem of "difficulty in buying vegetables" is still more worthy of attention.
Understand the reasons behind the contradiction between the current abundant supply of materials in Xi'an and the difficulty of meeting the basic needs of citizens. Or it will clarify for us the challenges that retail companies need to face when dealing with unexpected situations, the risks that may arise, and the issues that need to be focused on.
"The Third Eye on Retail" confirmed the fact that the current supply of civil biological resources in Xi'an is basically sufficient after understanding from many parties. At the same time, it was also found that the main reason for the problem of "difficulty in buying vegetables" was that the demand surge was low and the shortage of manpower was serious. Consumption is concentrated in online channels, the existing distribution capacity is difficult to support, and the cost increase is more.
Previously, during the epidemics in Wuhan in early 2020 and Zhangye in 2021, which was focused on by the Third Eye, retail companies faced almost the same problems.
Demand is surging and there is a shortage of personnel
Costs increase
Although the government, retail enterprises, the media and other parties have always been promoting the abundant reserves of daily necessities in Xi'an. However, in the face of uncertainties, many consumers have chosen to hoard rice, flour, grain, oil, fresh and other commodities. Retail companies have to face a sudden "rush to buy".
This "rush to buy" mainly appeared on December 22, 2021, after Xi'an City announced that the next day the city entered closed management. "We replenished the market four times that day, but in the end all the dishes were bought." Zhang Huqiang, head of the Xi'an Xianmu Farmers' Market, said. Guo Tianhao, general manager of Mihe Fresh, also said that the wholesalers who normally left work at 6 p.m. sold goods until the early morning of the 23rd. Even if it is constantly replenishing, the shelves of many retail companies have been emptied that day.
In addition to this round of "rush to buy", after December 28, the government issued "free dishes" to the public during the one-time large-scale purchase, which also intensified the pressure on vegetable supply in the Xi'an market.
In fact, during the epidemic, due to the implementation of various control measures, the supply of vegetables has declined. According to Xinhua News Agency, since Xi'an strictly controlled vehicle travel on December 27, the total number of vegetables entering the Xinqiao market every day has decreased by 20% compared with before, and the Xinqiao market has supplied more than 90% of the vegetables in Xi'an.
Zhang Huqiang also told "The Third Eye on Retail" that although there is no shortage of goods at present, the supply is relatively tight. "After delivering to Xi'an, foreign drivers need to face the problem of being quarantined after returning, so they are reluctant to deliver."
Vegetable prices have also risen significantly in the face of surging demand but tight supply. It is understood that after the epidemic, the average increase in the purchase price of vegetables in Xi'an has reached 20%-30%. During the government's distribution of free dishes, the price of cabbage soared by 300%. In addition, during the epidemic, many companies have chosen to sell vegetable packages, which have increased operating costs in the middle of sorting, processing, packaging and distribution.
However, during the epidemic period, the market supervision department has strict control over the price of goods, so how to stabilize prices in the case of increasing costs is the first problem facing retail enterprises.
For retail companies, in addition to "out of stock", the bigger challenge is "lack of people". After the city's closure on December 23, many retail practitioners were isolated at home and unable to go to work, which led to many stores not being able to operate normally. According to data from the Ministry of Commerce, the opening rate of 13 key guaranteed supply enterprises in Xi'an was once less than 30%. As of January 4, the attendance rate of personnel in beilin district guarantee enterprises was only 51%.
"The attendance rate of some of our stores is only 30%, and one store has not opened because of full isolation." Originally, there were more than 50 merchants in the Mihe Market, and now only 5 or 6 merchants are operating normally." Guo Tianhao said. In addition, Xi'an Hema launched an employee sharing plan, which clearly identified 500 job gaps.
In the case of severe manpower shortage, retail companies are also facing the pressure of increasing labor costs. "The Third Eye on Retail" learned that the wages of employees in many retail companies have increased by 3 times. "When we were guaranteeing supplies to the new city, we temporarily found more than a hundred people to sort and distribute goods, and these people also needed to pay wages." Zhang Huqiang said.
In addition, under the pressure of closed-loop management and high-intensity work, the psychological counseling and enthusiasm mobilization of employees are crucial. At the same time, how to dispel employees' concerns about the risk of infection and prompt them to return to work in a timely manner is also a problem that enterprises need to consider. It can be said that only when retail enterprises solve the personnel problem, the problem of "difficulty in buying vegetables" in Xi'an has the possibility of being truly solved.
Channels have decreased, and online orders have soared
Delivery capacity is the biggest constraint
Since December 27, Xi'an's prevention and control level has been further improved, canceling the original two-day shopping outing, requiring all citizens to insist on not leaving home, and since then, citizens' consumption has almost completely shifted to online. It was also during this period that the problem of "difficulty in buying vegetables" broke out in a concentrated manner.
"The last thing before going to bed and the first thing to wake up every day is to grab the dishes, and even need to set an alarm clock to grab the dishes in the middle of the night. Hema's delivery brother has become the most difficult person to meet in Xi'an. Someone said on the platform. The online orders of Mihe Fresh reached 6,000 on December 28, and before the epidemic, Mihe Fresh basically had no online orders.
When orders are all concentrated in online channels, the current distribution capacity of retail enterprises is difficult to meet the daily shopping needs of the city's 13 million people. In the case of soaring online orders but limited store sorting and distribution capabilities, most companies have chosen to narrow the scope of distribution and open online platforms at a fixed time.
For example, Hema opens online orders at 0: 8, and 12 o'clock, and community group buying platforms such as Xingsheng Preferred are open at 23:00 every day. This leads to the fact that most people need to rely on "grabbing" to shop. Most of the time, the above platforms cannot place orders normally.
From this point of view, the direct cause of the problem of "difficulty in buying vegetables" in Xi'an is the lack of distribution capacity.
First of all, the sorting, packaging, and distribution of online orders all require manpower as support, but as mentioned above, due to the epidemic control measures, many employees cannot work normally, and normal delivery is difficult to guarantee. It is understood that the driver arrival rate of Meicai.com is about 60%. The rider attendance rate of individual takeaway platform sites is about 30%.
Secondly, the delivery efficiency of merchants has also decreased significantly. Subject to traffic restrictions during the epidemic, riders and drivers will be checked multiple times during the delivery of goods, thus increasing the delivery time. At the same time, there are also differences in the control measures of different communities, which also increases the difficulty of distribution.
It is also based on the above problems that many online platforms have launched fixed packages, community group purchase services and measures to reduce the scope of delivery. At the same time, in order to solve the problem that consumers cannot shop offline, many offline retail companies have also begun to carry out online business. However, in this process, due to its lack of online operation experience and no third-party logistics cooperation, it has also encountered many problems in this process.
On the day of the "lockdown", Mihe Fresh launched a vegetable package and distributed it in Xi'an City. "We did a similar activity before, and it was JD.com who was helping us with delivery. But this time, JD.com and SF have almost stopped after the epidemic, and the logistics team we set up ourselves has a relatively low distribution efficiency and extremely high cost, and the logistics cost of one piece of goods has reached 30 yuan. Guo Tianhao said.
Around December 28, online orders surged to 8,000 orders, and it was not until January 2 that Mihe Fresh processed the backlog of orders. Also because of the inability to perform the contract in time, the company received a lot of customer complaints. "We have experience in distribution and processing, and the biggest challenge in this process comes from logistics." He said at the same time.
In terms of this epidemic, in solving the problem of 100 meters, in addition to online channels, the community has also played an important role. Many community stores have established communities during the epidemic to allow consumers to place orders in the group, and then the stores will be centrally distributed to the community. Because it is a unified distribution and the distance is relatively close, the overall cost, manpower requirements are low, and the efficiency is relatively higher.
The situation of "difficulty in buying vegetables" has been improved
How to respond to emergencies requires reflection
According to data from the Ministry of Commerce, on January 7, 1,045 of the 1,722 stores of 13 key supply enterprises in Xi'an were operating normally, and the proportion of business reached 60.6%, an increase of 30% over the lowest period. The price of vegetables in the focus of monitoring wholesale markets has dropped by 14% compared with 10 days ago.
With the gradual control of the epidemic situation, the continuous improvement of various policies and regulations and the response measures of enterprises, the problems of "shortage of goods" and "shortage of people" of Xi'an guaranteed supply enterprises have been effectively solved, and the situation of "difficulty in buying vegetables" has improved. With the end of the epidemic, the problem of "difficulty in buying vegetables" will no longer exist.
Although, in most emergencies, the difficulties faced by retail companies are caused by objective reasons, the epidemic is no exception. Whether it is employees who are isolated and cannot come to work normally, or offline channels are difficult to consume normally, it is not possible for enterprises to change.
However, for retail enterprises, ensuring the supply of people's livelihood is a social responsibility that needs to be borne by supply enterprises, so enterprises need to have the ability to respond to such emergencies. In today's normalization of the epidemic, whether it has this ability is even more important.
In fact, after experiencing the impact of the sudden epidemic in Wuhan in early 2020, the public generally believes that local governments and related enterprises have the ability to respond to such emergencies, so they have higher expectations for the ability to guarantee supply.
Today, looking back, whether it is Wuhan, or Zhangye, Xi'an, retail enterprises in the epidemic encountered problems is not much difference, in a nutshell is to ensure the supply of goods, manpower and logistics distribution.
After the epidemic in 2020, Xinle Supermarket doubled the safety inventory of rice, noodles, oil and other livelihood commodities, and the supermarket's daily material reserves were sufficient. Therefore, in the face of the sudden epidemic situation, 500,000 people were guaranteed to work, and there was no problem in the supply of materials in Xinle Supermarket.
At the first time of learning that Xi'an would be closed for management, Zhang Huqiang asked employees to live in the market and carry out closed-loop management for them, so as to avoid employees being isolated and unable to work normally. It is understood that except for one aquatic products merchant, the other stalls of the Xianmu Farmers' Market are operating normally. This also provides a basis for its subsequent supply of new urban areas and sinking to community sales.
National chain retail enterprises such as Yonghui, Hema, JD.com, and Meituan have a strong supply chain system that can ensure that they mobilize materials and ensure supply at the first time of the epidemic. While it is difficult to buy vegetables through various mainstream channels, many companies are buying vegetables through douyin live broadcast, and their attention and order volume are also quite considerable.
From the above perspective, if the company itself has a certain sense of crisis and can make plans for various emergencies in advance, then the problem similar to Xi'an's "difficulty in buying vegetables" may be solved.
At present, the current round of the epidemic has been effectively controlled. According to the normal situation, after the end of the epidemic, retail enterprises are bound to usher in retaliatory consumption of consumers, coupled with the demand for hoarding goods during the Spring Festival, the market will usher in a new wave of consumption. However, due to the approaching Spring Festival, many suppliers and logistics channels have stopped operating, and it is not known whether the Xi'an market will once again have the problem of "out of stock". 【End】
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