Interface News Reporter | Lou Yibei
Interface News Editor | Ya Han Xiang
"Huang Guangyu, the former richest man in China!" "Secret meeting with Chen Zhengguo, chairman of Leerle!" This is the content that the Leerle supermarket chain has recently actively disseminated on the official accounts of major social platforms.
Leerle is a hard discount supermarket brand in Changsha, Hunan. Not long ago, Huang Guangyu, the founder of Gome Group, visited the retail chain in Changsha, Hunan Province, and was personally received by the founder Chen Zhengguo and his senior management team. After the visit, the two sides held closed-door talks and signed a cooperation agreement.
On May 14, Jiemian News asked Leerle to confirm the progress of the above-mentioned cooperation, but the relevant person in charge refused to respond.
Not only is Leerle actively spreading the cooperation with the former richest man, but since May 1, Gome Supermarket, which is operated by Huang Guangyu, has also continued to publicize the matter through the Douyin account, saying that Gome Supermarket and Leerle have finalized the cooperation, and said that "the sword is pointing to hard discounts". Before that, the official Douyin account of Gome Supermarket had stopped updating for 4 months.
Founded on July 25, 2023, Gome Supermarket (Guangdong) Co., Ltd. is a "trendy fashion metaverse super store and a global new retail live chain experience store focusing on consumption to benefit the people and a better life". To put it simply, its business model includes offline physical stores and online live broadcasts. In terms of sales categories, its previous publicity focus was snacks and water drinks, and there were more member discount plays, and the positioning was biased towards the discount snack stores that have become popular in recent years.
In November 2023, the news that Gome plans to open 10,000 Gome supermarket retail stores within three years has attracted attention, and even triggered a sharp rise in the stock prices of Gome-listed companies. Subsequently, Gome Retail, a core listed company of Gome, issued an announcement stating that Gome Supermarket is not operated by the company, but is operated by the main shareholder Huang Guangyu and his affiliates in cooperation with a third party. The company also said that it does not rule out the possibility of exploring new retail projects in the future.
The operation mode of Gome Supermarket is not a franchise store, but closer to brand authorization. Supermarket operators pay brand usage fees to the operating company, 15,000 yuan for two years below 40 square meters, 30,000 yuan for two years below 40-80 square meters, and 50,000 yuan for two years below 80-120 square meters. As of November 18, 2023, Gome Supermarket said that it has opened three stores, and another seven are under renovation to open.
Although Gome has boasted about Haikou, there are signs that its plans to expand stores quickly have been blocked. In addition to the suspension of the above-mentioned Douyin official account for 4 months, the last tweet on the WeChat official account of Gome Supermarket also stayed on November 15, 2023. On Dianping, Guangzhou, which has the most information about Gome supermarket stores, only has 6 merchant records.
And Leerle, who was favored by the former richest man, looks like a lot of money.
Founded in Changsha, Hunan Province in 2011, Chen Zhengguo, a native of Shaodong, Hunan Province, was inspired by the "Joy of the World after the World" in "The Story of Yueyang Tower" and named this supermarket Leerle. In a past interview, he said that the original intention of Leerle was to save students money and let them buy authentic products at a low price.
Leerle explains the positioning of its hard discount store as selling regular goods, mainly from the supply chain, warehousing and logistics, human efficiency, private label and other links to reduce costs, so as to win more room for price reduction for goods.
2019 is the dividing line for the development of Leerle. Prior to this, Leerle mainly relied on the first-mover advantage and the rapid development of the B2B model, relying on the flop husband and wife store to expand the scale of terminal procurement. After 2019, Leerle began to gradually change the loose franchise to a close franchise, and at the same time developed a partnership direct store. By 2023, Leerle will face the national layout and set up an investment promotion team, Leerle Huimeng, and said that it will invest 1 billion yuan in the supply chain to build supply chain advantages.
According to the official disclosure of information, at present, the number of Leerle stores exceeds 4,000, of which more than 90% of the stores are franchised stores, with the gradual prevalence of discounts, in 2023 alone, Leerle will expand more than 1,000 stores, with an annual sales scale of more than 40 billion yuan, and the highest annual sales scale of a single store will reach 1.176 billion yuan. According to a report by 36 Krypton Hunan, in 2024, Leerle will break through 10,000 stores through Leerle Huimeng, with a revenue of more than 100 billion.
Such a considerable performance, but Leerle has no reputation, perhaps because Leerle has not yet entered first-tier cities such as Beijing, Shanghai, Guangzhou and Shenzhen. This discount supermarket chain from Hunan has more than 2,500 stores in its base camp, and also has more than 10 provinces and cities such as Hubei, Jiangxi, Guangdong, Henan, Sichuan, Guangxi, Chongqing, Yunnan and Anhui.
Based on information from platforms such as Dianping, the location where Leerle haunts is usually the "worst" spot, such as near a university town, on the second floor or basement of a popular business district. Leerle mainly develops with three main store types, including small stores of 300-800 square meters; 1000-2000 square meters of medium-sized stores; 5,000-10,000 square meters of warehouse store.
Most of the people who come here to purchase are college students, the elderly, and even husband and wife, shopkeepers. In the sharing post about Leerle on Xiaohongshu, many college students said that they came here to buy because it was cheap and recently.
The products sold by Leerle are rarely fresh, but "standard products". The 2 yuan Nongfu Spring sells for 0.9 yuan in Leerle, and the 5 yuan Oriental Leaf Leerle sells for 3.7 yuan, and the 0.01 yuan/bottle (listening) of tea π, Oriental leaves and Coca-Cola will also be launched on the third-party takeaway platform.
Such low prices come from its supply chain operation system. In terms of supply chain, Leerle said that it relies on the supply chain resources of Hunan Gaoqiao Market, where more than 6,500 suppliers and 150,000 employees are gathered. Among them, more than 200 core "super suppliers" form the "super supply chain" of Leerle, reaching more than 15,000 categories.
In addition, Leerle also reduces costs in many aspects.
Leerle's store can be called simple, with rows of goods piled directly on the packaging cartons; Stores usually only carry out simple decoration, and can even directly distribute goods without changing the shelves; In the distributor, Leerle said that the manufacturer directly connected to the warehouse distribution of Leerle, and the warehouse distribution was directly delivered to the store and franchise stores, and a series of operating expenses such as shelves, bar codes, and authorizations were canceled, and there was no difference in the price of goods.
To a certain extent, Leerle, which has been dormant for many years, is like Pinduoduo in the supermarket industry, winning the affordable consumer market through supply chain integration and extremely low prices.
For now, the cooperation between Leerle and Gome Supermarket seems to be a win-win cooperation. Through the aura of Huang Guangyu's former richest man, Leerle further enhanced its brand value and attracted more franchisees, and Gome Supermarket took advantage of this shareholder wind to enter the sinking market with hard discounts, so as to get out of the predicament and start anew.
It is still unknown how the cooperation between Gome Supermarket and Leerle will be carried out, and whether Leerle's unique special wholesale discount store model can continue to be quickly replicated in the sinking market will continue to be tested.