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Surprisingly, although the earnings report was not positive, Dada's stock price still ushered in a wave of rebound that day, and finally closed at $8.1, up 25.78%.
On the backside of this market reaction was a brief outburst of repressive emotions: Dada shares had fallen for a year in the secondary market, falling from a peak of $30.5 to $6.44, and the market value fell by $11 billion.
Not surprisingly, Dada will remain shrouded in negative market sentiment in the coming months until it finds a way to prove itself more than just a local delivery company.
Riders are costly and rely more on internal blood transfusions
The decline in Dada Express revenue was explained in the earnings report as a result of excluding rider-related revenue and costs in the income statement. The growth of JD.com's revenue is driven by the increase in the number of active consumers and the average order size.
According to the Southwest Securities Survey, in 2020, Dada can earn 5.43 yuan per single, of which 3.92 yuan is paid to the rider, accounting for 72.3%, and the single gross profit is 0.96 yuan, and the gross profit margin is 17.7%. Compared with the express delivery field, the gross profit of a single ticket of Zhongtong was 0.47 yuan, and the gross profit margin was 23.2%.
This means that the higher the rider's cost, the lower the gross margin of Dada. And, the worse news is that instant delivery is currently unable to drive rider costs down through economies of scale.
Taking Meituan Takeaway and Zhongtong as an example, in the process of the average daily single volume climbing from 10 million / day to 47 million / day, the transit transportation cost fell from 1.2 yuan / single to 0.8 yuan / single, a drop of nearly 50%; while the average daily single volume of Meituan takeaway increased from 11 million single / day to 28 million single / day, the cost of single delivery did not decrease.
Although the express delivery industry has deteriorated due to the deterioration of the competitive landscape and the failure of enterprises to convert economies of scale into shareholder returns, the long-term profitability of instant delivery companies that are also fiercely competitive is even less optimistic.
However, from the past, the proportion of Dada's two major revenues has been reversed in the past few quarters.
In 2020, the proportion of Q4 was 63.9% and 36.1%, by Q1 of 2021 it will become 53.3% and 46.7%, and by Q4 of 2021 it will become 35.4% and 64.6%.
The scary thing is not the loss
According to the financial report, Dada's net loss in 2021 was 2,471.1 million yuan, compared with 1,705.2 million yuan in the same period last year.
Where is the money spent? From the financial report, on the one hand, it is customer acquisition, on the other hand, technology.
It is worth noting that although Dada's investment in user growth has been very generous, it is still difficult to hide the fact that the cost of user acquisition is getting higher and higher.
In terms of technology, that is, R&D expenses, the financial report shows that R&D expenditure in 2021 was 573.9 million yuan, compared with 428.8 million yuan in the same period last year, an increase of 34%. In the past year, Dada's expenditure on research and development has not increased significantly, and has remained at a stable level, but in terms of the proportion of technology investment, it will only be 6% in 2021, which is not a high proportion for a platform that needs technology drive.
For a company that is still growing, the scary thing is often not the loss, but the limited room for growth.
A data compiled by Southwest Securities shows that in 2019, the market share of instant delivery entities is the top three in the market, of which Meituan ranks first with 47.2%, more than half of the share of the second place, and from the perspective of order volume, it is also the Meituan group far ahead.
The future is still promising
Despite its own strong rivals and losses, there are obvious externalities in the instant delivery industry: it is the key to supporting the near-field e-commerce ecosystem.
In the process of the overall GMV of e-commerce migrating from the traditional form to the near-field e-commerce represented by community group buying, the growth rate of e-commerce business flows corresponding to the instant delivery market is higher, and the characteristics of high frequency and low price of superimposed instant orders, that is, the growth rate of distribution logistics will be amplified.
From the data point of view, in 2020, the transaction amount of Meituan's takeaway business was 488.85 billion yuan, up 24.5% year-on-year, and the total GMV growth rate of Ali, JD.com and Pinduoduo corresponding to non-near-field logistics was 23.2%.
Guojin Securities pointed out in the research report of the express logistics industry that the market size of the fresh food field will grow to 164 billion yuan by 2025, with a growth rate of 18.8%. Southwest Securities also expects that the instant delivery demand generated by 2C near-field e-commerce represented by fresh e-commerce will be 37 billion in 2025.
On the other hand, from the current point of view, Dada and Jingdong have entered a deeper integration binding, and the proportion of Jingdong's business will be further increased in the future, which is contrary to Ku Jiaqi's expectations.
The test facing Dada now is to diversify its business, strengthen its own hematopoietic ability and reduce losses, and how to expand the revenue share of external business while strengthening its close relationship with JD.com.