Convenience bees need to "return" to the essence of convenience stores

Convenience Bee, which has maintained a low profile in the past six months, has once again come to the cusp of the storm because of rumors about its "closure" in recent days.

Regarding the closure of stores, the convenience bee responded that because of the isolation of the epidemic, the transportation of goods was affected, and a small number of stores had to be temporarily closed.

The impact of the black swan event on offline retail is huge, and companies like convenience bees, which take heavier self-operated physical stores as the fulcrum and expand at a high speed, thus running out of scale advantages as a development strategy, are naturally the most obviously affected. Offline stores are closed from time to time, and the passenger flow drops sharply and is unstable; the pace of opening 200 new stores per month has stagnated, directly disrupting the "Ten Thousand Stores" plan originally set by Convenience Bee.

No matter how much "algorithm" and "technology" account for in the story told to capital, in the final analysis, convenience bee is still a chain retail enterprise, and ultimately it is necessary to return to the basic model of convenience stores such as location, function, and human efficiency.

For convenience bees, the strategic closure at this time is to achieve the final victory in the race with further optimization of the store model.

How big is the closure?

How big is the closure of the convenience bee this time? At first, according to the self-media report, the convenience bee closed 700 stores nationwide, and the convenience bee responded that the figure was not true.

The notice received by the clerks of each region about the closure of the convenience bee is not the same. A Hefei convenience bee shop assistant revealed to 36Kr-Future Consumption that as far as he knows, 300 stores across the country will be closed, of which Hefei stores will be closed one after another.

Through the convenience bee APP to query the store data in Hefei, you can see that of the 15 stores displayed, only 3 are still in business, and the rest of the stores are shown to be resting.

A clerk in Zhuhai said that the store closure was due to renovation upgrades and would reopen in the future. Zhuhai is a new city for convenience bees in January 2022, and the app currently shows 4 stores, of which 2 are closed.

Taking Qingdao and Zhengzhou, which have been the focus of the layout of convenience bees in the past two years, as an example, the two cities are the places where brands of convenience stores have developed in recent years. In Qingdao City, of the 30 stores displayed on the Convenience Bee APP, 5 are still operating normally and 25 are "resting", and of the 30 stores displayed in Zhengzhou City, 11 are operating normally and 19 are "resting".

In addition, in several more mature markets that convenience bees entered before 2018, such as Nanjing, Tianjin, Langfang and other cities, the closure of stores is slightly better than that of Zhengzhou, but there are also more than ten closed stores. As the base camp of convenience bees, Beijing accounts for a relatively low proportion of stores closed.

The above information obtained through the Convenience Bee APP can reflect the scale of convenience bee's store closure from the side. According to the response of the convenience bee, some points have not been rented, not completely closed, but only temporarily closed, and will be reopened in the future.

In the convenience store industry, although the growth rate of the track itself slows down in 2021, whether it is a Japanese convenience store or a local regional convenience store, it still maintains a certain number of new stores.

Judging from the information displayed in the Convenience Bee APP, the Convenience Bee has entered 38 cities at present, but the number of stores has not been publicly disclosed since 2,000 at the end of 2020. According to the third-party platform "Diandiantong", there were a total of 2789 stores at the beginning of this year.

In the case of Lawson, which has similar expansion goals to convenience bees, as an example, by November 2021, Lawson has nearly 4,100 stores in the Chinese market, adding about 100 new stores per month. Previously, Osamu Miyake, president of Lawson China, had proposed to reach 10,000 stores by 2025.

Why are you closing?

The strategic closure of the convenience bee at this time may be based on multi-party considerations, based on algorithms, and the temporary closure of some stores with poor performance at this time can save manpower and transportation costs and minimize losses.

However, to some extent, it also reflects the certain shortcomings in the current operating model of convenience bees under the guidance of algorithms. The first is that due to the shortage of "extremely streamlined" personnel, it is difficult for convenience bees to be flexible in responding to emergencies.

Some convenience bee employees broke the news in the pulse that the company cancelled the year-end bonus in 2021 because "due to the epidemic, the company's performance did not meet expectations." But in fact, convenience stores are the least affected by the epidemic in the offline channels, according to the Bain report, in 2021, the sales of various offline channels have shown a downward trend, only convenience stores to maintain the original level.

This is because, during the stay-at-home period, the distance between the convenience store and the community is close enough to become an effective supply site. During the sealing period of several cities in the past, convenience stores have played an important role in ensuring supply, such as 36524 convenience in Hebei, providing consumers with daily supplies and vegetable supplies during the lockdown of Shijiazhuang in early 2020. Looking closer, during the lockdown in Taiyuan, Shanxi, which just ended two days ago, Tangjiu Convenience has also become the first choice for shopping channels for residents who have been sealed in the community.

The above two convenience stores can achieve a good order volume during the prevention and control period, precisely because of the mobility of the clerks. Taking Tang Jiu Convenience as an example, during the lockdown period, the store manager spontaneously initiated group purchase order solitaire in the WeChat group, and delivered it to the door of the community for free for consumers, and handed the materials in from the closed gate.

Although the function of delivery to home can be provided in takeaway platforms, store APP, and mini programs, through the simple way of WeChat group buying, on the one hand, it can effectively social fission, so that consumers in the group know that this channel can still buy goods during the sealing period; on the other hand, initiating group purchase in the group can naturally make up enough orders to centralize distribution, reducing the cost of human delivery, and even reducing communication costs.

Therefore, some traditional convenience stores have cultivated users' consumption habits during the sealing period to increase long-tail value. These two points are difficult for the convenience bees that advocate automation and standardization at present.

Secondly, the brand potential of convenience bees is still insufficient in other cities except Beijing. On the one hand, the convenience bee is indeed still an emerging player, and the recognition is lower than that of veteran players such as 711 Rosen; but the more important reason is the convenience bee's store expansion strategy.

Since 2021 alone, the number of cities that facilitate the entry of bees has directly increased from 20 to 38, covering North China, East China, Central China and South China, which can be said to be "blossoming on all sides".

From the perspective of the history of the expansion of the convenience bee, the convenience bee first occupies the representative cities with consumption guidance, such as Beijing, Shanghai, Nanjing, Guangzhou, etc., and radiates to the surrounding cities as the center, such as Shijiazhuang around Beijing, Jiangsu cities around Nanjing, Zhongshan City in Guangdong, etc. This method is a common means of convenience store regional expansion.

But looking back at the penetration method of convenience bees in 2021, it seems "complete and impenetrable".

Specifically, according to the new areas officially released by the convenience bees on social media, not only involve Guangdong, Jiangsu, Fujian and other provinces, but also include inland provinces such as Shandong, Hebei and Henan. In contrast, Lawson, which has a similar number of new stores, will continue to focus on the two major markets in central and southern China in 2021, which allows Lawson to penetrate lower-tier cities one by one in the process of sinking.

In several new cities in 2021, according to the APP, the number of stores is mostly in single digits. This leads to its own brand influence that is not well known in the local area, and it is difficult to lock in the volume of calls through intensive locking, and it is more difficult to form a scale effect in a certain area, and correspondingly, in areas with low store density, the ability to resist sudden risks is relatively weak.

Convenient bees to save themselves

In fact, last year, convenience bees also tried to jump out of the system and make step-by-step optimizations to the current operating model.

The first is to continue to streamline store costs. Previously, Convenience Bee launched its own takeaway business in 2018, and since then, the main delivery mode of Convenience Bee has been a self-built delivery team.

This fully self-operated, full-link data in their own hands of the model, although very heavy, but conducive to the optimization of the convenience bee algorithm model. Relying on the self-operated distribution team, the convenience bee also tested the water in the early days of e-commerce and other aspects of the next day.

However, in the second half of last year, some consumers found that convenience bees began to use third-party riders such as hummingbirds and Meituan crowdsourcing as delivery personnel. Not only that, but a large number of store staff recruitment contracts are also signed through outsourcing companies, and these initiatives are aimed at "reducing the burden" of the already heavy model as much as possible.

The second is to do revenue increments. In the past year, the convenience bee fully accessed the takeaway platforms such as Meituan and Ele.me. Prior to this, the takeaway system of convenience bees was mainly on APP and mini programs, and after accessing third-party platforms, the online exposure of stores may increase, increasing the traffic source of convenience bees to a certain extent.

In terms of categories, Convenience Bee launched the specialty coffee brand "Sleepless Sea" to make up for the lack of consumption scenarios. Judging from the subsidy intensity of the first discount at the beginning of the launch, the initial investment of convenience bees in the sleepless sea is very large. According to the convenience bee, it plans to make the sleepless sea standard in all stores.

But unlike the high-profile propaganda at birth, the sea is much more low-key today. From the perspective of consumers, the direct synergy between sleepless sea and convenience bees is still not smooth enough.

Taking the takeaway system as an example, at present, Sleepless Sea exists on the platform as an independent store, and is embedded in the convenience bee store, but the two systems are independent and do not communicate with each other. This means that consumers place orders from convenience bee stores to buy sleepless sea drinks on platforms such as Meituan or Ele.me, and sleepless seas cannot contact consumers, and if there is after-sales, out-of-stock and other issues, it is difficult to solve.

It can be seen that the data system and store model of the convenience bee still need to be further polished and optimized in the future.

In the good interest of the convenience bee, Zhuang Chenchao and the zebra capital behind him can continue to transfuse blood for the convenience bee in the short term. On April 16, according to Tianyan, the industrial and commercial changes of Convenient Bee Trading Co., Ltd. increased from US$900 million to US$1.21 billion.

But convenience bees also need to pick up the pace. In June last year, 36Kr reported that the convenience bee was planned to go public in the United States at the end of last year or the beginning of this year, but now the plan has been shelved for various reasons.

In the environment where external capital is becoming more and more difficult to find, convenience bees need to "cut down on food and clothing" and usher in the day of overall profitability through their respected "algorithms".