Sentence | Moda
"New quality productivity" is undoubtedly the hottest word at the moment.
The supreme leader has mentioned on more than one occasion the need to speed up the development of new quality productive forces. This year, the "Government Work Report" has listed this goal as the first of the top ten tasks.
Compared with traditional productivity, new quality productivity needs to accelerate the transformation and upgrading of traditional industries and the transfer and transformation of scientific and technological achievements.
This is not only an intrinsic requirement and inevitable choice for accelerating the development of new quality productivity, but also an important focus for achieving high-quality transformation.
As an enterprise that focuses on "managing customer relationships" and focusing on user needs for business and innovation, Kidwang has subverted the business logic and business model of traditional mother and baby stores since its birth, and has been regarded as a "new species" by the outside world.
To a certain extent, the "newness" of the new quality productivity coincides with the "newness" of the child king.
In the past year, KidKing, which has continued to deepen and innovate in business, has continuously smoothed the innovation chain, broadened the industrial chain, and improved the supply chain, while shaping its own full growth resilience, it is also leading the high-quality development of the maternal and infant industry.
On April 25, the 2023 annual report of Kid King was released, and during the reporting period, Kid King achieved an operating income of 8.753 billion yuan, a year-on-year increase of 2.73%, excluding the impact of interest expenses on convertible bonds and share-based payment expenses, and the net profit attributable to the parent company increased by 55.70% year-on-year.
It is worth mentioning that the increase in the scale and profitability of Kid King is not achieved by sacrificing cash flow. In 2023, the net cash flow generated by Kidwang's operating activities will be 804 million yuan. This is the sixth consecutive year that KidKing's operating cash flow has been positive since the financial data was available in 2018. Considering the current downward pressure on the economy, this achievement is not easy.
More importantly, the financial report shows that by the end of 2023, the monetary funds on the account of the child king will reach 2.472 billion yuan, and the abundant cash flow and healthy financial situation make the child king's resilience as always undoubted.
From this financial report, we can see that in the context of weak β in the maternal and infant industry, the child king is expected to achieve strong α growth by cultivating internal strength and gathering energy.
1. Smooth innovation chain: Numerical capabilities have become the foundation for growth
An objective fact is that the number of births in China is gradually approaching the ceiling, and the demographic dividend is disappearing. But on the other hand, the new generation of young families, two-child families, parenting concepts and needs continue to innovate, which forces the maternal and infant industry to "kinetic energy transformation".
Under the stock competition and incremental market, how to find breakthrough growth?
The development of new quality productive forces is both the result and the answer.
In essence, the new quality productivity is to promote industrial innovation with scientific and technological innovation, especially to promote new industries, new models and new kinetic energy with disruptive technologies and cutting-edge technologies.
In the past 15 years, the reason why Kid King has been able to evolve, iterate and upgrade all the way, and redefine the maternal and infant industry, is inseparable from "innovation" -
Insist on keeping up with market demand and carry out business innovation, and persist in chasing user needs and innovating experience.
In the view of the child king, the decisive ground of the trillion-dollar market of the maternal and infant and children's industries is only a small part of the goods, and a greater proportion lies in the service. The group served is not limited to the traditional maternal and infant category, but a broader space for the growth of parent-child families and children of all ages.
This means that the maternal, infant and child industry has long passed the high-speed growth stage of the tuyere fast run, and has entered the high-quality growth stage of competing for refined operation of people and freight yards.
From the earliest informatization to digital intelligence, KidKing has vigorously implemented the omni-channel development strategy with its strong digital capabilities, giving full play to the advantages of scenarios and supply chains, and forming a deep "infrastructure" barrier.
This is highly consistent with the core driving force of new quality productivity - scientific and technological innovation.
In 2023, the online sales revenue of children's king maternal and infant products will be 3.289 billion yuan, accounting for 43.42% of the sales revenue of maternal and infant products. As of the end of the period, the APP had more than 56 million users, more than 62 million Mini Program users, and more than 10 million users of the enterprise and micro private domain services.
In terms of real-time retail business in the same city, Kidwang has continuously optimized the full-link digital system, and has successively launched a series of time-sensitive products such as the fastest 30 minutes within 3km, the fastest 1 hour within 5km, the whole city delivery, and SF Express half-day delivery, with a timely order fulfillment rate of over 99%. It not only meets the needs of users for instant shopping, but also expands the leading edge of Kid King in the instant retail track.
Digitalization is not only a new technology, but also a high-latitude user experience. In the AIGC era, as an industry-leading enterprise in the level of intelligence, Kidwang took the lead in seizing this round of rush window.
In June last year, KidsKing launched the self-developed "AI Parenting Consultant Model" KidsGPT, an intelligent consultant that has mastered a large amount of maternal and infant knowledge, and has been applied in multiple scenarios such as KidsKing APP, Mini Program, and community, effectively broadening the boundary and depth of parenting consultant services, and improving management efficiency and operational benefits. In addition, Kid King has also launched AI live broadcasts, AI cute treasure photos, etc.
The importance of digital transformation in all walks of life is self-evident Today, we have seen the power of digital and intelligent transformation in KidKing.
2. Broaden the industrial chain: "endogenous + extensive" to create growth potential
Looking at the total population trend in the past 10 years, the peak growth occurred in 2016-2017, and children born in this stage have now entered the age group of 6 years old + middle and older children.
In addition, with the full opening of the birth policy and the increase in the fertility rate in the Year of the Dragon, the proportion of second and third children in the birth population has exceeded 50%, and the scale and consumption demand of second-child families, middle children, and older children have increased, which has become a new dividend for the maternal and infant population.
How to not only keep the basic stock of stock, but also seize the new opportunities of increment? The solution given by the child king is to find deterministic growth through "endogenous + extensional".
Last year, KidKing pioneered a new format of one-stop shopping and growth services for children - All-Age Children's Life Hall, becoming the first platform in China that can meet the needs of one large and one small family.
As a new format launched by KidsKing that can not only meet the one-stop shopping needs of parent-child families, but also provide social interaction and edutainment, the Children's Life Museum has made innovative leadership from the inside out.
According to preliminary statistics, after the upgrade, the average transaction volume of a single store in the children's life hall increased by more than 35% year-on-year (including large service business), and the average transaction volume of medium and large children increased by nearly 30% on average, and 200 stores will be upgraded across the country in the next three years, which is expected to bring a new "growth pole" to the performance of the child king.
It is reported that the Children's King All-Age Children's Life Pavilion has been officially launched on the APP, which is synchronously subdivided into parent-child life scenarios such as dressing, learning to play, nutritional supplements, and outdoor sports, and unlocking a new immersive parent-child shopping experience through all channels.
In addition to constantly cultivating internal skills, Kid King is also broadening the industrial chain through extension mergers and acquisitions to improve "environmental adaptability".
Looking back on the mother, baby and child track in 2023, the integration of the chain industry is the general trend. However, unlike the previous round of scale expansion, staking and turf competition, the new stage of maternal and infant chain rate is constantly improving, and the regional pattern and national pattern are gradually emerging. Behind this, it reflects the "complementary advantages of differentiation" and "the strong are always strong" of leading enterprises.
In 2023, Kidwang will complete the largest acquisition in the history of domestic maternal and infant chains, and officially incorporate Leyou into its portfolio, so as to accelerate the layout of the northern market and open up the development model of boutiques and franchise stores. The two form a complementary effect in terms of advantages and scenes, which further strengthens the leading position of the child king.
At present, KidKing has entered 200+ cities in 21 provinces and cities, and opened more than 500 large-scale digital stores. After the acquisition of Leyou, it has a total of nearly 1,200 stores.
In 2024, Kid King will officially open the franchise model, and the franchise business of large stores and small stores in the system will be opened at the same time. At that time, KidKing will share the core capabilities of existing store digital management and member precision marketing, work together with more partners to develop synergistically, expand scene formats, and serve more Chinese parent-child families.
From the perspective of the industry, whether it is the Children's Life Hall of all ages of the Children's King, from the space to the scene, it provides complete solutions and creates high-quality circle socialization, or the sinking penetration of the "big store + small store" channel formed after the acquisition of Leyou by the Children's King, up and down, there are more certainties.
3. Improving the supply chain: a differentiated path for sustainable growth
Looking at the road, we look at experience and confidence, and look at the future, we look at trends and strategies.
Previously, KidKing focused on managing customer relationships, based on the core pain points of customers, and pioneered the big store model, parenting consulting services, "goods + services + social" operation model, and the single-customer economic model under heavy members, etc., which broke out a strong growth momentum in linking users and services.
After years of accumulation, the child king has achieved the ultimate in the single-customer economy. By the end of 2023, the company has more than 87 million members (including 25 million Leyou), and member sales account for more than 98%.
As a result, the stickiness of Kid King members is getting stronger and stronger, with about 1 million black gold members, a year-on-year increase of 5%, black gold member income accounting for nearly 70%, and the output value of black gold single customers is more than 10 times that of ordinary members.
At the end of 2023, KidKing will continue to deepen the strategy of "global preferred and differentiated supply chain + local parent-child growth service + instant retail in the same city", and put forward the medium and long-term strategic direction: "expanding categories, expanding tracks, and expanding business formats". Among them, the expansion of categories is from mother and child to all ages, the expansion of the track is from a single lane to ten lanes, and the expansion of business formats is from self-operated stores to multi-scene formats.
From the differentiated advantages of the supply chain, to the service scenarios around the parent-child growth relationship, to the leading of the city-wide digital real-time retail model. The child king has found its own balance and embarked on a differentiated path of sustainable growth.
In 2023, KidKing will create a globally preferred and differentiated supply chain, establish a world-class service provider to cooperate with the popular circle of friends, and build a supply chain commodity system in different scenarios. Last year, KidKing established strategic cooperation with 1,450 self-operated suppliers, cooperating with more than 3,500 high-quality brands around the world, with short-chain direct supply accounting for more than 90%, and cross-border purchase revenue increased by 17% year-on-year.
In the construction of its own brand, Kid King continues to grow and strengthen its own brand, creating a rich product matrix. At present, Kid King has 11 major self-owned brands such as Better Double Care and Chuyimeng, covering the main categories of mothers, infants and children, and the differentiated supply chain accounts for about 11%, an increase of 40% year-on-year, fully meeting the differentiated and refined needs of member families.
During the reporting period, the differentiated supply chain of KidKing achieved a total sales revenue of about 820 million yuan, accounting for 10.82% of the sales revenue of maternal and infant products. Among them, the transaction volume of private brands increased by 74.37% year-on-year.
In terms of local parent-child growth services, KidKing vigorously develops intra-city services, focusing on the three major platforms of "maternity plus", "growth plus" and "intra-city plus", serving the three major customer groups of "mothers, children, and parents-child", meeting the local life needs of members in an all-round, full-scene and in-depth manner, and building a deeper, wider and wider moat.
In 2023, Kid King will implement the plan of 100 cities and 10,000 stores, unite the city's head allies, realize the sharing of member resources, complete the full coverage of 66+ major cities, and settle in more than 10,000 merchants in the allied camp. According to the financial report, the transaction volume of the "intra-city plus" business in 2023 will increase by 105% year-on-year.
At the Children's King investor exchange meeting on April 26, the management said that in 2024, it will win the three must-win battles of the Children's Life Museum, the non-standard battle, and the battle of the same city. From a long-term perspective, the child king is still doing difficult but right things, which is worthy of being optimistic.
The market is always dynamic, and for enterprises, they need to take advantage of the trend and take precautions in advance in order to usher in the other side of the cycle.
China has the largest consumer market and the most diverse population. In this industry that serves "new life", its own vitality is still germinating, and the future can be expected.