Supermarket inventory in 2023: price wars, alternation of old and new brands, introduction of more product content, and determination to return to offline

2023 is coming to an end, with the replacement of new and old supermarket stores and the upgrading of space, all of which are inseparable from the theme of returning to offline. Whether it is a price war or an improvement of experience, supermarkets are inseparable from the theme of offline drainage. At the same time, new and old supermarkets have also completed a market succession this year, and traditional stores have gradually been replaced by new models of supermarkets. It is worth noting that no matter what form it takes, the commodity, experience, and supply chain are still the foundation of the supermarket.

Closing

Since the beginning of this year, the traditional stores that have opened hundreds of stores in China, Carrefour and Wal-Mart have been shrinking, especially Carrefour, and Chinese stores have closed stores on a large scale. Taking Beijing as an example, Carrefour currently has only one operating store in Beijing, but only a small number of shelves in the store are open for sale, and other areas are temporarily closed to the public.

In addition, Wal-Mart, Yonghui Supermarket, BBK and other high-loss stores have also closed some loss-making stores and tried in new formats. Relevant statistics point out that the market share of hypermarkets continues to decline, and some hypermarket chains have even decided to close their underperforming stores across the country.

Under the impact of live e-commerce, community group buying, and instant delivery, the passenger flow of traditional hypermarkets has been shrinking, and the industrial chain and supply chain of hypermarkets are long and multi-layered, which has become a disadvantage now.

Expansion

Competition in the retail industry is intensifying, and supermarkets are also trying to improve their services and refined management to meet the diverse needs of consumers. Supermarkets and stores have developed from the supporting formats of shopping malls to small complexes. The Sam's Club app has a "Gift Cards" category in the product category. Card coupon categories include gourmet restaurants, buffets, dessert cakes, hotel vacations, life services, etc., but these products are non-self-operated products.

Not only Sam's, but also retailers have made great efforts to improve services and expand product categories, and continue to "fill" within the framework of the store, so that the offline scene with thin functions has become "full" in content. In order to attract traffic, companies have also expanded their categories, and Hema has also launched "Whale Life" and launched housekeeping services. At the same time, Wumart multi-point App supports the placement of life service products. According to the relevant person in charge of Wumart, the services in this sector are provided by third-party merchants, and at present, the related business is growing rapidly, and the main services promoted in different periods have achieved rapid growth.

entity

The reshuffle of the retail industry is the entry and exit of the old and the new. Traditional stores are closed, and cutting-edge chain brands are taking over to open stores. A few days ago, Tongzhou Sunshine New Life Plaza introduced Freshippo, and the location of the store is the original Carrefour Tongzhou store. In addition, a reporter from Beijing Business Daily learned that Seven Fresh Supermarket settled in CapitaMall Grand Canyon. It is reported that the Seven Fresh supermarket is the first store in the country to add offline cashiers. In July this year, Seven Fresh Supermarket Beijing Lufthansa Outlets and Tianjin Jinyu Jiapin Store opened on the same day. In addition, the Chaoyang Beiyuan store of Seven Fresh Supermarket also opened in September this year.

Not only that, Hema X Club took over from Walmart and opened at the Dawang Road store of New World Department Store. AEON Supermarket Chaoyang Joy City, which has been operating in Beijing for more than a decade, closed last year. China Resources' Olé supermarket will enter Chaoyang Joy City, nearly a year after Aeon Supermarket closed its store. In the face of many alternative channels represented by new retail, it is difficult for hypermarkets to provide consumers with sufficient store links in terms of product selection and display.

Price

"Moving mountains" and "tug-of-war"...... Nowadays, these common words have become a "catfish" in the supermarket track, setting off a fierce "price war" in the competition of the industry. The reason is that Hema has reduced the price of some of the same products of the same standard Sam, and Sam has also bitten the price to adjust the price. Some typical products have a 30% to 40% reduction, and Hema revealed that the ultimate goal of the "discount" change is to make all Hema products more competitive. The new procurement model and supply chain optimization are the key to supporting the long-term "discount" reform.

It is worth noting that not only Hema and Sam, but also this year, Yonghui Supermarket has set up a discount area in the store, and Wumart Supermarket has also tried to open a discount store independently. As a leading retailer in the industry, whether it is Sam's, Hema or Yonghui or Wumart, it has been maintaining low purchase prices and converting them into low selling prices through large-scale procurement and refined supply chain management to attract more consumers.

In the end, the competition of "price war" is the competition of supply chain and commodity chain, which requires both parties to work harder to promote market development.

live broadcast

The short video platform lays out local life, and supermarkets are also looking for traffic online to attract traffic to stores. Since the beginning of this year, Wumart, Yonghui, Metro, etc. have successively opened accounts and live broadcasts on Douyin, Walmart has opened live broadcast rooms on JD.com, and Hema has entered Taobao Live Broadcast, including three modes: hourly delivery, mailing and online group purchase + in-store pickup.

Live broadcast and short video platforms have also begun to carve up the local life market, giving traffic tilt to "in-store". Driven by the fact that instant retail seems to be more likely to drive chains out of the circle, in-store visits are irreplaceable in importance. Offline merchants can link to in-store customers through the creation of scenes, and consumers can greatly reduce the consumption threshold in the process of shopping and improve the flexibility of income disposal. For the offline retail and service industries, seizing this wave of dividends will drive growth. In-store consumption has also played a key role in the upgrading of the retail industry. After the retailer determines "who the in-store shopper" is, it makes in-store improvements based on the needs of this group of people, so as to form a deeper repurchase bundle with customers.

Membership store

In a year when the retail industry is looking for transformation, membership stores are still opening high. In 2023, Fudi+ boutique supermarket will open two stores in Beijing in a row, as a supplement to the member stores, to achieve complementary scenes. At the same time, Sam's new store in Beijing is also in the pipeline. Sam's expects 6 to 7 new stores to open every year in the future, and the number of Hema X Club stores will also reach 10.

At present, Costco has opened 5 stores in Chinese mainland.

According to Kantar Worldpanel's China Shopper Report 2023, hypermarkets' market share continues to decline, with some hypermarket chains even deciding to close their underperforming stores across the country. However, thanks to the increase in the number of shoppers and the increase in shopping frequency, warehouse membership stores in the hypermarket format achieved a strong growth of 58%. The popularity of membership stores reflects the strong consumer demand for innovative, cost-effective, private label products. This brings a greater test to traditional supermarkets.

Beijing Business Daily reporter Wang Weiyi