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Source: Zhenghedao (ID: zhenghedao) Wei Zhe, former CEO of Alibaba, founding partner and chairman of Jiayu Capital. In just 13 years, his Jiayu Fund has incubated more than 30 unicorns and even super unicorn companies, including well-known brands such as Guoquan Shihui, Shanghai Auntie, Smoore International, and Bubble Mart.
In the current situation where everyone is shouting that business is difficult to do, the Shanghai aunt he voted for reached more than 7,000 stores last year.
Another hot pot barbecue ingredients supermarket brand, Guoquan Shihui, has grown from more than 3,000 stores to 10,000 in the three years from 2020 to 2023. It was listed on the Hong Kong Stock Exchange only 6 years after its establishment.
In 2024, what will be the macro trend, and what should new consumer companies do?
How to achieve a breakthrough from 1,000 to 10,000 stores, and what is the secret behind the success?
China's economy has entered a new cycle, that is, China's consumption has moved from the incremental market to the stock market.
If you look around the world, you will find that the major economies have gone from high-speed incremental economies to stock economies since World War II. China has just entered such a new cycle of stock economy and stock consumption.
When the cycle is switched, it is an era of survival of the fittest.
There was an era of dinosaurs in the history of the earth, when dinosaurs faced the change of climate cycles, it was not the most powerful dinosaurs that survived, but the most inconspicuous pterosaurs survived by evolution.
Therefore, entrepreneurs, the new cycle is both a crisis and an opportunity for us. The consumer companies that were strongest in the previous cycle are not necessarily the most successful in the new cycle. And seemingly inconspicuous consumer companies can also find opportunities in the cycle.
1
The golden age of the birth of national brands
A landmark event occurred last year, Li Jiaqi overturned in the live broadcast room because of the 79 yuan Huaxizi eyebrow pencil. Why didn't everyone say that it was sold for 79 yuan in the early years, but now it has caused controversy? That's because it was still at the end of the incremental economy a few years ago.
In the era of the incremental economy, every consumer has expectations for their own income growth. The essence of Internet celebrity brands is driven by marketing, and customers can't stand a shout, and the money in their pockets will be taken out. Nowadays, consumers do not necessarily have less money in their pockets, but their expectations of income growth have weakened, and consumption has switched from an incremental economy to a stock economy.
At this time, the brand is no longer driven by the marketing side, but by the supply side, and the successful supply-side brand will eventually move towards the national brand.
When did Japan enter the era of the stock economy? In 1985, the Plaza Accord was signed, and since then the Japanese economy has lost 20 years, 30 years, and even 40 years.
In 1984, UNIQLO was born in Japan at the moment when it entered the stock economy. It is the most representative Japanese national brand in my mind, and at least half of the people in Japan wear Uniqlo. There is also a large market in China, whether it is white-collar workers in first-tier cities or small-town youths in third- and fourth-tier cities, there are people who wear them.
The founder of Uniqlo, who makes clothes, has always been in the top three of Japan's richest list for the past few decades.
I think the most representative of the national brand in the United States is Costco. Warren Buffett has always said that Costco is not for sale, and he has never sold its stock since he bought it. The United States has a population of more than 300 million, and I looked at Costco's financial report, and it should have 123 million loyalty cards worth $99.
In principle, one membership card per family is sufficient. The United States has a population of just over 300 million, and does the 123 million membership cards cover more than half of the population?
After World War II, the United States has experienced a booming economy and has lived a good life for more than 20 years. Where was the inflection point? The two energy crises and the Vietnam War put the United States out of the fire, the two most serious energy crises were in 1973 and 1979. Coincidentally, in 1976, between 1973 and 1979. You see, another national brand was born in the era when the economy entered the stock.
It is said that Buffett's wealth today is basically what he began to accumulate after he turned 50. Some people analyze that it is because his investment style has matured after the age of 50. Personally, I think there is a second reason, you see that when Buffett was 50 years old, it happened to be the 80s - early 90s, the economy entered the stock era, and his portfolio was Coca-Cola, McDonald's, Costco and other national brands, and later Apple.
I want to tell you that it is not terrible for the economy and consumption to enter the era of stock, because this is precisely the era of the birth of great national brands.
There are also many companies in China that have begun to take shape as national brands, such as Xiaomi. If I do a survey on the spot and say that there is no Xiaomi product at home, please raise your hand, I don't think anyone will raise your hand. In fact, in my mind, as long as half of the people don't raise their hands, the national brand will be successful.
Although my phone is not Xiaomi's yet, I have a bunch of Xiaomi products at home. But if we look at a young man in a small town, his first mobile phone, or the young man's first car, may be Xiaomi's.
In a first-tier city like Shanghai, the core consumer group of Guoquan Food Market is white-collar workers. However, in fourth- and fifth-tier cities or small towns, pot ring food is still loved by local consumers.
Although these brands have not yet fully become China's national brands like Uniqlo and Costco, when the economy enters the stock era, only such brands will become winners and adapters when the cycle is switching.
2
National brands should do these 5 things well
The first thing is that a brand that can sink is a good national brand.
Hunyuan County in Shanxi is a small place with four or five tiers, but I saw Aunt Shanghai here. I saw the strong vitality of these brands in the county. Only when a brand can sink to these places can it have a chance to become an excellent national brand.
How can we do a good job of sinking? These three elements are indispensable. The first is whether your product can sink or not. The second is whether your store type can sink. The third one is the most difficult, whether your management can sink or not.
First of all, let's talk about the sinking of the product.
Starbucks is placed in the United States and can be called the national coffee brand of Americans, but its price of more than 20 yuan may not sink in China. Therefore, the most similar to China's national coffee brand is Luckin, with a price of between 12 and 15 yuan.
For example, the unit price of fresh fruit tea brands is 20-30 yuan a cup, and it is difficult for such a price to sink to China's third-, fourth- and fifth-tier cities.
Is the cheapest one the most sinking? Not necessarily. It's not enough to have a lining, you also have to have a face.
Many people are worried about whether the national brand is downgrading consumption, whether things are going to be sold cheaply? Not necessarily, the national brand is never the cheapest one, there are many supermarkets in the United States that are cheaper than Costco, and there are cheaper clothes in Japan than Uniqlo. So my point of view is to move from cost-effective to price-to-value ratio.
This is not a play on words, but a change in the way of thinking. What does cost performance mean? Performance is fixed, and then the pursuit of the ultimate price, this is called cost performance, this path is easy to be caught up by peers.
The price-to-value ratio is to dare to set prices, and I will achieve the ultimate in performance, function, value and quality after pricing. Even if my peers catch up with my price, I continue to improve in performance and can crush each other.
The new energy vehicle industry now has an exclusive term called "stacking", that is, to improve the hardware configuration as much as possible within the price range, refrigerators, sofas, and large color TVs are all loaded. Although the cost may be high at the first moment, if the car is sold, the upstream supplier has room to reduce the price. Therefore, Li Auto is very good in terms of gross profit margin and net profit.
If it is always cost-effective, it will enter a vicious circle. If a product doesn't have a proper retail price, it won't be able to sustain the business model and the financial model. Therefore, the sinking of the product does not mean that the cheaper the better, but the sinking of the product is to do the sinking with the thinking of the price-to-nature ratio.
The second is the sinking of the store type, which is very important. I have always had a saying that big stores rely on direct sales, and small stores rely on franchises. Relying on direct sales means that you are a set of management system, and the small store relies on the struggle of every franchisee and small and medium-sized enterprise owner.
In fact, the most important thing is to design a single-store model for your sinking store again. This year, Haidilao is open to joining, and Jiumaojiu's Taier Sauerkraut Fish has also begun to open up to join, so what is a good single-store model?
You have to think from the perspective of a franchisee. The life-and-death line of the single-store payback cycle is 18 months, if you can't return the cost in 18 months, you won't be able to attract the best franchisees in the market.
Therefore, when you do the sinking of the store type, you have to redesign the single-store model, the core of this model design is not how much money you make, but to let the franchisees who sink with you return to their costs within 18 months, or even in a shorter period of time.
To make a small shop, we have to ask ourselves in advance, is the store for the floating population or for the permanent population? For example, if it is a store for the permanent population, it will stick to the community, and there are 3,000-4,000 families in the community to support a store. If you do a business for the floating population, then open it in a shopping mall.
In addition, the product mix is different for the floating population and the store type for the permanent population. In order to achieve a chain of 10,000 stores in China, it is necessary to make a store type with a permanent population. There are more than 6,000 shopping malls in China, and it is worth opening about two or three thousand, even if you add some core business districts, there is still no way to achieve a chain of 10,000 stores. An excellent 10,000-store chain enterprise must be able to be a community store, and must be able to stand and survive.
How many stores can a 10,000-store chain enterprise open that is successful for both the permanent population and the floating population? Usually about 30,000 is the limit. Look at Mixue Bingcheng, both types of stores are doing well.
We all know that Changsha is a city of Internet celebrity brands, and when it comes to Changsha, I think there is only one brand that has the potential of a 10,000-store chain, which can do business for both the floating population and the community population - snacks are very busy. Through the merger, snacks are very busy and have been on the road of 10,000 store chains.
Therefore, to do a 10,000-store chain, in addition to understanding the essence of the sinking of the store type, it is also necessary to clarify whether it is a business for the floating population or the permanent population. This can even affect when you open, your product mix, and so on.
For example, in the case of operating members, Guoquan Food Exchange is a permanent resident business, so it uses enterprise WeChat to completely hand over member management to the store, and each store can take care of its own 3,000 members.
Shanghai Auntie is mainly engaged in the floating population business, and consumers are here today and there tomorrow, so can I build the membership system on WeChat? Impossible, it is still necessary to build on the mini program. Therefore, if you divide the store into two types: resident stores and floating population stores, the opening time of the store, the product mix, and even the foothold of the membership system are different.
Of course, the convenience of the whole family is called refined operation. They have nine types of stores, and to what extent is the division of labor? For example, at the airport, the stores outside the security line are different from the stores inside the security line. Since the drinks can't pass the security check, there are relatively few drinks in stores outside the security check line, and they are so fine.
The third and most difficult is the management sinking.
This is something I particularly admire about Bull, which now has 1.1 million terminals. Seven years ago, the founder of Bull confidently said to me, "Wei Zhe, you go all over the country, as long as you see one of Bull's shop signs is old, broken, and missing, you take a photo and send it to me, and I will give you a red envelope of 10,000 yuan." I haven't gotten a penny in seven years.
What is my suggestion in the management of sinking? For the 10,000-store chain brand, the density of the area is the priority. Many people used to say that they wanted to be thousands of cities and thousands of stores, and I often corrected the founder, if you want to be thousands of cities and thousands of stores, I won't vote for you.
I also want to cover 1,000 cities when I open 10,000 stores? Isn't it okay to do 100 stores in 100 cities?
The value of thousands of cities and thousands of stores is lower than that of hundreds of cities and thousands of stores, except for a few words, the average of 10 stores in each city is less, isn't this jumping into the pit by yourself?
Why is density the core of managing sinking? There are two main things, the first is to optimize the supply chain distribution, whether it is a normal temperature car or a frozen car, the cost of a car running for a day is fixed. You used to deliver to 5 stores, but now it becomes 15, and the delivery cost of a single store is reduced. How to achieve delivery to 15 stores a day, it can only be close enough to stores and high enough density of stores to improve the efficiency of the supply chain and reduce the cost of the supply chain.
Second, density determines the difficulty of operation management. Today's 10,000-store chain cannot completely rely on technology to solve the sinking management, you still have to have supervision. If the density is not enough, a supervisor can only look at 3-5 stores, but if the density of the store is high enough, one of your supervisors has the opportunity to cover more than 10 stores.
Recently, there are a lot of bubble tea companies listed, you can go back and read the prospectus, don't just read their revenue and profits, you divide the number of stores by its employees, you know who is the king of management. An excellent brand is one that each on-site employee can cover more than ten stores, but this is impossible without regional density. I emphasize that we should do 100 cities and 10,000 stores, because 100 cities and 10,000 stores means that the density of a single city is 10 times that of thousands of cities and 10,000 stores.
Of course, we emphasize regional density, but we don't want you to have to cover every province, and this kind of leapfrogging will make it more difficult for you to manage, and it doesn't make sense. We prefer the development of the encroachment system, which is a secret to good management - forget the administrative divisions of the country, and eat them bite by bite like silkworm babies eating mulberry leaves. Let me give you two examples:
Ali has a branch in Inner Mongolia, and Inner Mongolia is so big, how does it solve the management problem? That is, every branch adjacent to Inner Mongolia "bites" upwards, Shanxi "bites", Hebei "bites", and Shaanxi "bites", and each of them takes a step to the north, and then the neighboring Inner Mongolia is in charge.
For another example, whether it is Gu Ming or Shanghai Auntie, they have a warehouse covering 300 kilometers, which covers both Zhejiang and Anhui, and is not restricted by national administrative divisions. The way to play the development of the chain encroachment system is to take a step forward every time the logistics arch forward, and constantly move forward, rather than leapfrogging forward, and it is not restricted by administrative divisions to develop.
I talked about the three sinking, product sinking, store sinking, management sinking, what to pay attention to in the three sinking, what to pay attention to in the store type, and what to pay attention to in management.
The second thing that national brands should do well is to win the world.
In the era of Internet celebrity brands, it is necessary to win the world in Beijing, Shanghai, Guangzhou and Shenzhen, and to win the world in more than a dozen coastal cities, which is what Internet celebrity brands should do in the incremental era. The simple reason is that global luxury brands need to occupy the commanding heights of Paris, London, Milan and New York, and only then will the brand have a chance to spill over to other cities.
But if it is a national brand on the supply side, the logic is to win the world. We should look at the "four provinces of mountains and rivers" from Beijing, Shanghai, Guangzhou and Shenzhen, Henan, Hebei, Shandong, and Shanxi, with a population of more than 300 million in the four provinces. If you want to be a national brand in China, without these more than 300 million people, you can't cover the whole of China.
In the era of increment, many southern brands went north. However, in the era of stock, many northern brands have gone south, from north to south. Why is this happening? Because the consumption power of the Central Plains, especially the four northern provinces, is weak, and if your products, pricing, store types, and business models can prove successful in the north, and you go south, it will be easier to fight. You can do the most difficult market, product, store type and management, is it easier and easier for you to go south?
In addition, if you haven't done a four-season market in the north, your products and store types may have blind spots. For example, in Guangdong, I still drink iced fruit tea in January, but when I go to the north, the fruit tea will be directly frozen as soon as I take it out in winter. Therefore, in addition to summer products, the brands that started in the north must also have thoroughly studied winter products.
The same goes for the store type. Many stores in the south, especially those that are mainly takeaways, can actually be a stall store, and the door curtain is not needed, and the salesperson stands on the side of the road to sell goods directly. If you go to the north, these two salesmen at the roadside stall will freeze directly into popsicles.
Therefore, the store in the north must not only have a door curtain, but also have two door curtains, if there is only one door curtain, the air conditioning and heating will run away in winter. Therefore, only after experiencing the four distinct seasons in the north, it will be easier for your store design, products, and markets to go south.
To sum up, the national brand in the era of stock economy has returned to the Central Plains to win the world, which has to be done through the "four provinces of mountains and rivers", and it is necessary to do a good job from north to south.
Let's take a look at those brands that started from the Central Plains, Mixue Bingcheng, Guoquan Shihui, and even the former Shuanghui and Synear all started from Henan.
These consumer brands that have proven the success of the Wandian chain and have begun to take shape as a national brand, you will see that they all started from the Central Plains, and they all used their ability to penetrate the four provinces of the Central Plains and take down the most difficult northern market. Therefore, in the new era, the Central Plains will win the world, and it will be fought from the north to the south from the "four provinces of mountains and rivers".
The third thing that national brands should do well is to do it in the off-season.
As soon as the summer comes, the frequency of eating hot pot must have decreased, so it is necessary to pull up the barbecue. At that time, various football events around the world also began, and everyone watched football, drank beer and skewers, so the pot circle food exchange made a camping scene again. To do consumption, remember not to do things that are more prosperous in the peak season, but to achieve the off-season.
What each of our consumer companies has to ponder is how to make the off-season not light, because you have paid the rent, the employees are there, and the franchisees have to eat, so what we have to use our brains all day long is to eliminate the off-season, so that there is no off-season all year round.
In addition to the seasonal off-season, we also have to find a way to eliminate the seven-day off-season a week. We helped FamilyMart design a membership system, and the original idea of FamilyMart was to put the member's day on Saturday and Sunday, because these are the best days. I said don't do anything to make the peak season more prosperous, let's see which day is the lightest, it's very strange, not only the whole family, but all convenience stores in China are the lightest on Wednesday, so we set its membership day on Wednesday, and it has continued until now.
Now seven days a week, the convenience of the whole family is the most prosperous on Wednesday, and the lightest day of the week is not light.
Catering companies also have to find ways to eliminate the off-season of the day. Mr. Zhai of the hometown chicken listened to me after a lecture, and when I went back to the hometown chicken, I had breakfast. In fact, there is nothing new under the sun, KFC has been selling soy milk fritters for a long time, you have to do it, otherwise your morning will be wasted.
For another example, the milk tea brand is about to enter the peak of the day after 11 o'clock, and the business of the bubble tea shop before 11 o'clock is generally not good. Coffee shops are the opposite, and coffee shops have a downward inflection point at 11 or 12 o'clock. So there are tens of thousands of stores in Shanghai, of which nearly 2,000 are embedded with coffee, and the rent is paid anyway, and the employees have to go to work and open their doors.
In short, the mantra is, don't do things that are more prosperous in the peak season, eliminate the off-season, and do not light the off-season. The off-season has three dimensions, four seasons of the year, seven days a week, from morning to night.
The fourth thing that national brands should do well is the integration of product channels.
Today's good national brand must be the "king of kings" and must be the integration of product channels.
Let's take a look at foreign examples, Uniqlo is essentially a product company, but it builds its own self-control channels. Costco is a channel company, but its own brand accounts for 70%-80%, which is a channel company to embrace products, from channel to product king, and become the "king of kings". It's the same with Uniqlo.
What kind of company is Pop Mart? a product company, but it completely controls the channels, from its own stores, vending machines, to small programs to brush blind boxes. The pot ring food exchange and Shanghai aunt are all to achieve the integration of product channels. Because today you only have product profits are not enough, you only have channel profits are not enough, only the superposition of two profits makes your safety point higher, and the space for profits to consumers can appear. Therefore, it is necessary to be the "king of kings" of channel product integration.
Is it enough to integrate products and channels? It is not enough, the "king of kings" must be upgraded, and excellent national brands must dare to embrace technology to the upstream of the upstream, and together they are called the trinity of trade, industry and technology.
We have to embrace technology, where is the technology? In a word, the technology of consumer goods is upstream of you.
Your upstream technology can be encountered by your peers, so you must jump away from your upstream and go to your upstream to do research and development with technology.
For example, Uniqlo is so powerful, it is very important to have an invisible champion behind it, called Toray Toray Materials, and its market value is also very amazing. Many of Toray's materials are used in semiconductors.
As another example, I once went to Changsha to inspect a project of a monk fruit purification sugar substitute company. Nowadays, many consumers don't want to eat real sugar, they have to eat sugar substitutes, and the side effects of monk fruit purification may be minimal. We went to the company and asked who its number one customer was, and it turned out to tell me it was Costco, a national brand in the United States.
I said oh my God, we are in China, and it took us two years to find such a monk fruit purification company in Changsha, Costco, which is thousands of miles away, and has already used their products two years ago.
Everyone thinks that this monk fruit purification company is the upstream of making sugar, and Costco will not buy its products directly, it will buy the square candy that people use for coffee. Costco requires its sugar cube suppliers to use sugar substitutes that come from the monk fruit purification company.
National brand companies like Uniqlo and Costco are working on the supply side, not on the marketing side. You rarely see Uniqlo ads, and you hardly see Costco ads in the United States.
When many business owners are faced with competition, the team says that it is good to add two points to the marketing expenses? I have told many bosses that the same two points, do you dare to use them in R&D? If they are used in marketing, they will be spent, and your consumers will not get any benefits.
But if you do product development, consumers get the benefits. The era of national brands is driven by the supply side, and the core of the supply side drive lies in your product research and development.
We still have to believe that good products speak for themselves. Your product is not too hard, and the wider the marketing coverage, the more disappointed consumers will be with you.
The core of this cost-effectiveness ratio lies in whether the product performance can keep up after you set the price, and this depends on your product research and development. Let's not equate product research and development with national hard technology, all consumer goods, including catering, are worth research and development.
Let me give you an example, what is an important idea of Internet R&D? They have a lot of internal beta tests, and finally use closed-loop data to decide how to modify and adjust the product. The owner of the restaurant suggests that you try it, take a picture when you clean up the table, and then count it to see which of all the restaurants in the country has the most leftovers. You have to think about whether this dish should be changed, and whether this dish should be taken off the shelves.
Xibei has a famous red refrigerator, which is to put the leftover dishes from each table back into the red refrigerator every day, and the chef and store manager want to eat and see why there are so many leftovers of this dish. What is it? It's a closed-loop thinking in product development.
Similarly, Internet product research and development includes internal testing, public testing, and how to further adjust the product after it is fully launched.
Shanghai Auntie is almost bi-weekly a year, because of the volume of the milk tea industry, the proportion of new sales accounts for more than 30% of the year. New products are so important, so the research and development of new products of milk tea must come up with the method of Internet product research and development.
After trade, industry, and technology reach a certain scale, we must control the upstream factories. In addition to food safety, trade profits, product profits, and channel profits, you have to add another one, and the industrial profits that should be obtained must also be obtained.
The "king of kings" with products as kings and channels as kings is the first step, but after it is really done, it will put forward higher requirements - the trinity of trade, industry and technology, and the upstream to ask for technology, and dare to smash the marketing expenses of two points to increase the research and development costs of two points.
In addition to the "trinity of trade, industry and technology", people, goods and places are also very important. This is the fifth thing that national brands should do well.
Consumption is inseparable from people, goods, and places, and the order to be followed is to put people first, goods later, and then field. Let's start with people.
Many new retail brands are the first to break through the new retail field. In fact, we should go back to consumers, don't be obsessed with serving all consumers, the needle is fine enough to penetrate it, and the consumer group should be subdivided and subdivided. If we have the ability, we will always believe that young people will win the world, and the post-95s and post-00s will win the world.
Do middle-aged and elderly consumers care? Don't worry, penetrate young consumers, middle-aged and elderly people will have a crowd spillover effect. But in turn, to penetrate middle-aged and elderly consumers, he will not overflow to young people. When we were young, we bought it with our parents, and we used whatever brand they used. Now I follow my son all day long, and wherever he goes to play and eat, I will follow him.
Many of my attempts at something new like milk tea were educated by my son. So if you penetrate the post-95s and post-00s, he will have an overflow of age groups. Generation Z pleases themselves more than others, whether it is eating, catering, milk tea, or hot pot, it is most important to be satisfied, so we should focus on people like the post-95s and post-00s.
The second point is the goods. There are three main points of goods.
We divide consumption into four categories, one is called absolute FMCG, which is called daily active products in Internet terms, that is, the water you have to drink every day, the milk you have to eat every day, and the oil for stir-frying, which all belong to daily active products, and the unit price is a few yuan. On the other hand, it is called absolute durability, and houses, cars, refrigerators, and air conditioners are all absolutely durable. The replacement cycle is often several years, and the unit price of customers is thousands, tens of thousands, or hundreds of thousands, and the house is more expensive.
If you start a business to do consumption, my advice is that these two should never be touched. In the era of stock economy, the replacement frequency of absolutely durable goods is lower. Even with the help of capital, it is difficult for you to make a third one in addition to Yili and Mengniu, and it is difficult for you to make a 10-billion-level water brand in addition to Wahaha and Nongfu Spring.
These two should never be touched, so what should be touched? The two are relatively winning the world, called relatively durable and relatively fast-moving.
What is relatively durable? For example, our clothing has to be bought every year, and small household appliances are relatively durable goods. What is relatively FMCG? For example, catering companies, such as those who eat hot pot, are generally monthly active users, and many young people who drink milk tea are weekly active users, which are essentially called relatively FMCG. The goods in the people and goods yard should focus on relatively fast-moving consumer goods, which is the first point.
Second, it should be legally addictive. The reason why many people like to eat hot pot is because hot pot is spicy and has a certain addiction. Carbohydrates can relieve my troubles, and sugar also has a certain degree of addiction, which is called legal addiction. This is the second point in the goods.
The third point of the goods is called the linkage of equipment and consumables. The cigarette stem of an e-cigarette is a piece of equipment, and the cartridge is a consumable. The toothbrush rod of an electric toothbrush is the equipment, and the toothbrush head is the consumable.
The pot ring food market has to make a barbecue, and at first it couldn't be done because Chinese people don't have BBQ equipment at home, and there are not so many outdoor barbecue places. So it took two years to make an infrared oil-free and smoke-free indoor barbecue converter. After the equipment breakthrough, the consumables were only picked up later. So think about the equipment for the consumables, and think about the consumables for the equipment. The third is the linkage of equipment consumption.
The third point, after talking about people and goods, let's talk about the scene again. After making investments, we invest in e-commerce non-friendly consumer goods. What is e-commerce friendly? What is e-commerce non-friendly?
Or take the water on the table as an example, if you buy a case of water is an e-commerce friendly product, click on the phone screen, and someone will send a box of water to your door. But if you buy a bottle of water, it is not friendly to e-commerce, you must not send it through a takeaway platform, the waiting time is also long, and it is expensive, you should find a nearby convenience store or vending machine to buy that bottle of water.
So some categories are inherently e-commerce-friendly, some are e-commerce-non-friendly, and we just like to invest in e-commerce non-friendly.
The same goes for catering, don't be kidnapped by takeaways, because the core attribute of catering is that e-commerce is not friendly. No matter how fast you send something, it is different from the on-site experience. Some categories will change, from e-friendly to e-non-friendly, and vice versa.
I'll give you an example, snacks. Snacks were a typical e-commerce-friendly category more than four years ago, but three or four years ago, a new format emerged. At first, it was a wife in Zhejiang, and later it was a very busy snack store, with a store of more than 100 square meters and two or three thousand SKUs, which were consumed through consumers.
You can take two packets of dried tofu, a packet of peanuts, three chicken wings, and an average of forty or fifty yuan to eat seven different products. It is especially suitable for today's girls, who are greedy and afraid of gaining weight, but I spent forty or fifty yuan to eat seven or eight kinds of snacks, and I no longer have to buy a pack of one kilogram of pistachios like before. Today's Generation Z has a smaller family and eats mainly for one person.
In order to make an order for 40 yuan, I have to pick up two packs of dried tofu and three chicken feet for you in a huge warehouse. What's more, those offline stores still have the opportunity to taste new products for free, and the on-site experience is far more than crushing e-commerce, so it took less than three years for the entire snack industry to directly change from e-commerce-friendly to non-e-commerce-friendly.
Once the e-commerce is non-friendly, it means that the store will be opened, and the store will return to our sentence, high frequency, low customer unit price, and the store should be small enough. The store has a toilet or no toilet, we choose the store without a toilet, there are chairs and tables and there are chairs without a table, we only like to cast without a table. As long as you put tables and chairs, consumers will stay for a long time, and your fixed costs will be high.
You also put a toilet in such a good location, and the toilet not only has a rent, but also a cleaning fee. We haven't even invested in a shop with toilets and tables, and it's better not to have chairs, so we can't put a few chairs, and the smaller the table, the better.
Let's summarize the front: the era from the Internet celebrity brand to the national brand, from the cost performance to the price-to-price ratio, to sink the market, to get the Central Plains, to get the mountains and rivers of the four provinces to win the world; after the integration of product channels, to the upstream of the upstream to technology, to achieve the three-legged trinity of trade, industry and technology.
Finally, the order of people and goods can not be wrong, focus on the crowd, choose the right products, and think clearly about which format to use as your best format.
3
From 1,000 to 10,000, the password was revealed for the first time
How to realize from 100 stores to 1,000 stores, especially how to realize 1,000 stores to 10,000 stores? Our unique methodology is to reject the small and beautiful, and move towards "high and big."
What is "high"? High goals, big aspirations, and speed.
First of all, how does the high goal come about? Our first step is called "market capitalization to finance". What do you mean by "market capitalization to finance"? If your ideal net profit margin is 5%-6%. Then let's push it back, 3 billion turnover, 5% profit, is equal to your turnover multiplied by 20 times.
Therefore, if the pot circle food exchange wants to achieve a market value of 100 billion, what is the first step from market value to finance? 60 billion sales, 3 billion profits, so that there must be a market value of 100 billion. The method of building a market value of 10 billion is also this calculation logic.
What is the second step? It's called "Finance to Business". How did this 60 billion sales and 3 billion profits come about? 60 billion is 60,000 stores, and each store does 1 million a year. Or the other way around, 10,000 stores, each store does 6 million. So we first asked Mr. Yang of Guoquan Shihui, saying that we can run 60,000 stores? The largest number of stores in China is now Mixue Bingcheng, with more than 36,000.
The boss of Guoquan Food Exchange said that it is impossible to build 60,000 stores, and the market does not support you to have 60,000 stores, but the market supports more than 20,000 stores. When we say that 20,000 stores do 60 billion, how much does it mean? 3 million for a single store, this is another business indicator, go to the market to test whether it is possible. At that time, there was no need to do market inspection, because there were already some single stores with more than 3 million yuan, which was the third step "from business to market".
From the business to the market, the market is what supports the assumptions of your business model. At this time, there is only one thing left, if you can't do it, you won't blame the external environment, you have to blame the internal organization, so the fourth step is called "market to organization".
Second, the high goal is set, but we had better translate the high goal and transform it into a "big wish".
How did this inspiration come about? I have to thank Mr. Ma Yun, when Taobao was 60 or 70 billion yuan in 2005 and 2006, Ma Yun really wanted to do 1 trillion yuan. He translated the goal of one trillion yuan, saying that he would help one million merchants achieve annual sales of more than 1 million, 1 million× 1 million, and one trillion. But it's interesting to change it, Taobao's merchants at that time sounded very feeling, merchants felt that your high goals were helpful to me, and the employees were also very happy, because there were already thirty or forty thousand more than one million merchants at that time, and said that we would do a little more every month, and we could always achieve 1 million million merchants.
From this example, we have learned that high goals should be transformed into big aspirations, in fact, you shout out something that has real social value. The big wish of Guoquan Shihui and Shanghai Auntie is to make franchisees the happiest franchisees in China and become millionaires or multimillionaires with a thousand teams.
If you realize such a wish, it will be the market value of 100 billion mentioned earlier. Therefore, the high goal of 100 billion market value must be transformed into a big wish that customers have a feeling after listening to it, and employees have a big desire to grasp it, and then turn the high goal into a big wish to achieve it.
After the big wish, go on the speed. Big aspirations are important to the organization, vision, mission, and even culture, but ultimately you have to get up to speed. The 10,000-store chain we invested in has exceeded 10,000 stores in more than three years.
These stores are able to steadily open 300 stores a month and add 300 new stores a month, how did this come about? Of course, the core is that you embrace technology and organizational change.
Stress test is an Internet term, that is, when Double 11 arrives, it depends on whether our system can support hundreds of millions of people to buy at the same time?
First, how do I set the stress test target? Second, how to set the stress test frequency? The stress test target I suggest is 3-4 times the current normal store opening speed or business indicators. I know that I have opened a small store, and it takes about three months to select a location, sign a contract, and open a store, so I use months as the frequency of stress testing.
How to set the goal of 300 stores per month? Because before these companies cooperated with us, they were able to open 70-100 stores a month, and we directly multiplied it by 3-4 to get the goal of 300 stores.
What is stress testing? It's an end-to-end process, and it's a bit like driving a car. In the case of normal speed, you drive 80 km/h to 100 km/h, and find that this is a bit of an oil leak, that's a bit of a problem, and you fix it. Then drive from 100 kilometers to 120, and find that there is a problem, and you fix it again. This is a process of slowly discovering shortcomings and slowly solving problems.
The pressure test is different, it treats the car as your organization, and under the high pressure of 300 kilometers, it can press out all the shortcomings of your organization and all the shortcomings of various departments at one time, and it can also suppress many things that companies can do or not.
How to do stress testing? The core steps are just a few steps. 5+1。
The first thing is that each department shouts its own when it is difficult, don't call other departments. For example, taking Guoquan Food Exchange as an example, 300 stores are opened a month, and the supply chain raises its hand first, and there is not enough beef and mutton every month. The operation department said that the supervision was not enough, and the IT department said that IT could not hold up...... You aim to open 300 stores a month, each department shouts difficulties, each department has a big blank piece of paper, and in about ten minutes, each department writes its core difficulties.
The second thing is a little bit harder, it's hard to quantify. Since I've already told you to open 300 stores a month, don't tell me in a very general way. How much is lacking in the supply chain and beef and mutton, you can show me, if you open 300 per month, how many tons are you missing every month. And so on, each department took a moment to write down their quantitative difficulties again.
The third action is to reach out for resources and policies. Suppose the company gives you this policy and resources tomorrow, then what kind of policies and resources do you want to solve your difficulties? Each department has to spend some time, whether it is people, money or policies, they are also counted.
And the fourth thing, really assuming that tomorrow you have this policy and resources, how long are you going to solve the problems that you've quantified? This is the fourth action, the timetable. Once you've done that, you'll notice that the timelines of each department are of different lengths.
So what is the fifth action? How do you call it Razi timetable? For example, there are 10 departments, and six departments say it will take six months to get it done, and we will use this time to pull in the same time. If there is a department that can be done in three months, and you run ahead alone, and the brothers don't keep up, it seems that there are too many resources and policies for you, you have to reduce your resources a little, you have to slow down the pace, it makes no sense to run too fast alone. Some departments say nine months, that's too slow, let's adjust your resources and policies to see if you can catch up with six months.
So in principle, our timetable for these companies is pulled in six months, and at most seven months, this is the fifth action, the timetable of Laqi.
The meeting is over, and then you go out and forget about the task of opening 300 stores a month, this is not a budget, this is a stress test. We should open as much as we need every month, but we will come back every month and touch again, look at each other's watches, and look at each other what we promised to do every month, and don't drop the chain. After this meeting is opened, the store opening speed in the next six months will be 50 or 100, drop to 70, and return to 110, which is still high and low.
In the seventh month, it is the time to witness the miracle, and the Guoquan Food Exchange stands on the steps of opening 300 stores a month, and the eighth and ninth months are also the same. The shortcomings of the organization that affected the opening of 300 stores per month have been solved, and Aunt Shanghai has been perfectly solved in the seventh month, and now she is firmly stepping on the steps of opening 300 stores per month.
Opening 300 stores a month was a shortcoming for all departments of the entire organization at that time. When you're speeding up normally, you'll be solving HR issues for a while, operational issues for a while, and IT issues for a while.
This time, all departmental problems were pressed out at one time, quantitatively, and given resources to solve them. So this is our password from thousands of stores to ten thousand stores, and this is the first time that such a password has been made public.
But it has a very important premise, whether your single-store model is valid? When the single-store model is not established, the whole company will be crushed by me so much. Whether the single-store model is established or not depends on whether your franchisee has 890% of the return on investment within 18 months, which shows that the basic single-store model is established.
This is also why our kind of stress test can only be used when there are already hundreds of stores, and the number of samples is enough, and the number of samples has proved that a single store can hold up. Stress testing can't be done without the single-store model standing up, and the dry can be crushed.
So I'm going to get a vaccination, this set of things is very good, but only if your basic constitution is good. It's equivalent to me taking you to run a high-speed marathon, if you don't have a good heart, that's not good. You have to have a good foundation so that we can help you get up to speed.
To sum up, from 100 stores to 10,000 stores, we must refuse to be small and beautiful, and move towards "tall". Secondly, it is best to realize the chain of 10,000 stores in 100 cities, and to do a good job in a single store, to achieve the integration of product channels.
This article is reprinted from "Zhenghe Island" (ID: zhenghedao), focusing on the general trend and major events in the business world, making rational judgments and expressing them constructively.
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