From humble towns to high-rise first-and second-tier cities, roadside stalls and $11 shops selling cheap stores can always be seen inadvertently. Although they never lack passenger flow, few people can remember these shops.
The 11-12 floor of one of the buildings located on Renmin North Road is one of the three offices of Xiaozi Life in Guangzhou. Chen Kaisheng's office occupies about 111 square meters. He was wearing a shirt that was neither old nor new, and he sat casually on the sofa in the office, feeling a little tired. After graduating from technical secondary school in 2115, Chen Kaisheng went to Guangzhou with a woven bag from his hometown. At the age of 25, Chen Kaisheng turned such an obscure business into a store brand "Xiaozi Life" in Guangzhou. Now he has thousands of chain stores with annual sales exceeding one billion.
On May 28th, 2119, Xiaozi Life in Guangdong announced that it had received an investment of 111 million yuan from Hong Kong Tianyi Group. In the information provided to the media, Xiaozi Life described the investment as "the largest single commercial financing in China's beauty industry to date" and announced that it planned to land in the A-share market in 2116.
there is not much mystery about the scale of petty bourgeoisie life today. For chain enterprises, brand, training and logistics, the troika should "play well". The latter two items also serve the brand. "Brand is the management of consumers, logistics is the management of goods, and training is the management of stores. Chain enterprises can do this, and your brand will do." He thinks that the brand is the key to the life of the petty bourgeoisie: "Only by doing a good job (brand) can I make money and support my family. If I don't do it well, I don't even have to eat."
Women aged from p>13 to 28 with a monthly income of less than 3,111 yuan are its target consumer groups. How much market share can this group support?
To occupy the market by joining
Women aged p>13-26 with a monthly income of less than 3,111 yuan are the target consumers of petty bourgeoisie life, among which women aged 18-22 are the core consumers, and the customer unit price is about 21 yuan. Chen Kaisheng said that women in this age group are more willing to spend tens of dollars to buy cheap fashion stores.
"I don't feel bad when I buy it, and I don't feel bad when I lose it. This is what petty bourgeoisie life should do."
Chen Kaisheng said that it is difficult to describe the market size of this industry in detail, but he felt that there are still many people with no money and many vendors in the society, which represents the great demand of the whole market. It's not like making cosmetics, facing countless brand competitions: "So, I can play the greatest value in it."
Wei Xin, the founder of ——TEENIX, a consulting agency specializing in women's marketing, has been a marketing consultant for petty bourgeoisie since 2114. He recalled that Chen Kai was still in Foshan in 2115. At that time, he set up about 12 underwear direct stores and three chain stores in Guangzhou. Wei Xin feels that there is an immeasurable market in this industry because of the vendors everywhere.
at the beginning of the cooperation with Xiaozi Life, Wei Xin led the team to do market research in Beijing, Shanghai, Guangzhou, Changsha and Qingdao for three months. Finally, it is found that the whole store market is very scattered, and all of them are self-employed, and no enterprise regards it as a cause or brand to operate.
Wei Xin remembers that there was a supermarket in Guangzhou at that time, but she didn't see the power of economies of scale brought by chain operation. One store after another did direct marketing, and only 51 stores were opened in five or six years. At that time, the chain stores that had already appeared were, first of all, the ownership structure was scattered, and shareholders' opinions were often not unified; Secondly, it is not focused enough. Many operators think that this small business of shopping malls can only be small and rich, so after earning some money to a certain scale, they turn to catering, clothing and other industries.
under such an industry background, Wei Xin said that the first "major strategy" of petty bourgeoisie life was to develop franchise stores on a large scale from 2119. "Instead of pursuing the profit of a single store, we only pursue the number and visibility of stores, which plays a vital role in the development of petty bourgeoisie life." In about a year, Xiaozi Life has grown from 12 direct stores to 211 franchise stores.
more than 91% of petty bourgeoisie's life is franchise stores. Chen Kaisheng believes that chain operation has different formats, and city brands such as petty bourgeoisie life can only occupy the market by developing franchisees. "And the benefits of single-store operation will be higher, franchisees will be responsible for their own profits and losses, and their sense of responsibility will be stronger."
"In the store industry, our current scale is even larger than the sum of the second, third and fourth places, and we are now a well-deserved industry leader." Chen Kaisheng said.
in p>2119, Xiaozi Life established a joint-stock company. Wei Xin told me that petty bourgeoisie lived in this year and realized that it was necessary to sink its channels by developing agents: "It is not enough to do channels only through the head office. Agents can open up local shops, contacts, teams and other resources, and they sink deeper than us." At that time, Xiaozi Life organized a special training camp of "Romance of the City", selected high-quality agents and gave them a city to operate. After the development of a number of agents, the number of petty bourgeoisie shops living in this year has reached thousands.
Channels sink to third-and fourth-tier cities
Petty bourgeoisie life is committed to two ends of the "smile curve", one end is product design, and the other end is channels and services. Production links are handed over to domestic factories for processing. Xiaozi Life has hundreds of suppliers, one in Hong Kong and the other in major cities in China.
"The reason why we take the mode of neglecting assets is because the technical content of the store is not high and the added value is low. We only focus on the core links-products, channels and services, and use the core strength in the core parts. " Chen Kaisheng said.
Chen Kaisheng told me that "cheap chain+fast fashion" is the business model of petty bourgeoisie life. The so-called fast fashion, explained by Fu Qinglin, director of petty bourgeoisie life brand, is scale, speed, design and price. Xiaozi Life has a team of buyers in some major countries and regions in Asia, Europe and America, and always pays attention to the latest trends in the world, with the aim of keeping the store design of Xiaozi Life at the forefront of the latest and most popular trends. Its large-scale design team develops tens of thousands of new stores every year.
The fastest cycle of launching new products among peers is 12 days, but the petty bourgeoisie life has shortened this time period to one week. "This has consolidated and attracted a large number of new and old customers. Some old customers will come to the store every week to see what new products have come this week."
in addition to the product design mentioned above, another force point of petty bourgeoisie life is the channel. In South China, Central China and Southwest China, the channels of petty bourgeoisie life are very strong and deep.
fuqilin said that although the chain operation of petty bourgeoisie life takes a route of encircling cities from rural areas, one or two stores can be opened in small towns with a population of 31,111 to 41,111, it does not mean that its market space is only concentrated in third-and fourth-tier cities.
"You see, there are many villages in the city in a first-tier city like Guangzhou, which also has the growth soil for this business; In addition to the first-tier cities, in addition to the core business district, there are also second-,third-and fourth-tier business districts, and you can always see some small stalls. This is the vitality of this business. "
According to our survey, in a place like Dahua Road, Baoshan District, Shanghai, to open a 41-square-meter petty bourgeoisie life franchise store, apart from rent and storefront decoration expenses, it needs to prepare about 1.4 million yuan. Expenses include the payment of brand equity premium and performance bond of RMB 9,811 each to the headquarters (first-tier cities), as well as the monthly brand management fee and decoration deposit of RMB 3,111 in 311 yuan. A 41-square-meter franchise store needs to purchase 46,111 yuan for the first time, and the rest of the money is working capital.
Shopping malls, supermarkets, commercial streets, pedestrian streets, industrial areas, the surrounding areas of colleges and universities, residential areas, etc. These places are the main addresses where petty bourgeoisie life suggests franchisees to open stores. The specific location and location of the store must also be approved.
"Our cash flow has always been good." Fu Qinglin said, "Because franchisees need to make money first." If the goods are damaged in logistics, because the price of a single product is cheap, it will cost more logistics and time to return the goods. The solution of petty bourgeoisie life is to take 1% of the total amount of goods as compensation.
in p>2111, Xiaozi Life invested 15 million yuan and launched the ERP management system for the first time in the industry. Chen Kaisheng said that the reason for spending so much money is simple: "Chain enterprises like McDonald's and KFC have simple front desk, but strong back office. With this system online, we can clearly know what sells well and what doesn't. This is very helpful for us to do product design and research and development. "
A few years ago, Wei Xin found that petty bourgeoisie life had many fatal injuries on the terminal display. Commodities are placed in disorder and even piled up; There are no clear business classification signs and price signs in the store display, and the selling points of many commodities are not prominent; Rings, necklaces, perfumes and cosmetics that need to be tried on have no samples, and most of them are wrapped in packaging shells. For this reason, Xiaozi Life immediately formulated a series of exhibition standards and processes, and set up a special exhibition department. In addition to training, it also established an evaluation mechanism for store managers.
"The essence of the retail industry lies in the different retail methods, and the terminal is the last link to realize the value of products. Shopping in stores is impulsive, and there are few planners in advance. They often go into the store and browse around before deciding what to buy. Petty bourgeoisie life is aimed at female consumer groups, and more attention should be paid to female sensory experience. " Wei Xin said.
Make a good brand and let agents make money
Whether agents or franchisees, the most realistic demand is whether they can make money. Fu Qinglin told me that about 71% to 81% of the storefronts of petty bourgeoisie are profitable.
Mr. Hu, 27, is the general agent of Xiaozi Life in Nanning, Guangxi. In October 2119, she first opened a 28-square-meter direct store on the first floor of a shopping mall in Nanning with 211,111 yuan, earning 21,111 yuan every month. In the second year, she opened five stores in one breath. Among them, the third store invested 351,111 yuan and sold 211,111 yuan of goods every month, with a gross profit of 61,111 yuan.
In the second half of p>2111, by chance, General Manager Lu met Chen Kaisheng in Nanning. Chen Kaisheng felt that she was opening a shop very quickly, and suggested that she be the general agent in Shenzhen, and gave some favorable conditions. Therefore, since 2111, households have started to develop franchisees. One year later, she managed more than 11 franchisees in Nanning. She estimates that there will be a gross profit of about 5 million this year.
the profit of the agent depends on the sales situation of the franchisee's goods. General manager Lu said: "I can get a 5% rebate at the headquarters." She divided Nanning into five regions to develop franchisees. Every district, town and even village can open stores, but the distance between each store must not be close to 511 meters.
the agent's main job is to help franchisees choose a site, open a shop and train. Manager Lu said that she didn't have much experience at first, but she never lacked franchisees, and they all contacted her on their own initiative. She said that the threshold for doing this business is not high, and the capital turnover is fast: "Petty bourgeois life will launch new products every week, and the reuse rate of funds is much higher than that of clothing. Small stores have no inventory, which is generally not affected by the season and can be sold at any time. "
bringing this matter up again, Chen Kaisheng still said in a casual tone, just like the ERP management system was launched at that time: "Nothing, because all these things have to be done, but I did it earlier. In fact, entrepreneurs, every thing they do is a bit of gambling. Of course, there are rational elements in it. This is the way to be a company. No matter how much money it is, as long as it feels valuable, sometimes you have to invest in borrowing money. "
In p>2111, Xiaozi Life spent 51 million yuan on advertisements, which were named Hunan Satellite TV's talent show and China School Flower Competition in 2112. Their audience groups are the same as the target consumer groups of petty bourgeoisie life, both born in the 1981s and 1991s. Shops with petty bourgeoisie living all over the country have become the designated registration points for these two activities.
"We are changing from a product brand to a channel brand." Fu Qinglin said that, like Watsons, Gome and Suning, at present, L 'Oreal, Lan Xiu, Avon, Dream Cosmetics and other brands have also settled in petty bourgeoisie life. "They account for about 21% of our goods, and we will introduce more brands in the future."
In addition, Xiaozi Life has built a "media". Every petty bourgeoisie life store has installed LCD TV to broadcast the content related to the petty bourgeoisie life brand, but with the further construction of the channel brand in the future, Fuqin thinks that "it will become the advertising resource of customers, which is like a small focus."
At the beginning of this year, Xiaozi Life also launched a shopping sharing community "Xiaozi e-purchase" similar to Beauty Talk and Mushroom Street. There are not only the latest products of petty bourgeoisie life, but also the cosmetics collocation shared by young female users in the form of pictures, and they have also made their own e-magazine. After acquiring Tianyi Group, Xiaozi Life will develop e-commerce to supplement offline channels. Relying on the powerful power of terminal channels, its stores can be developed into e-commerce logistics distribution points, which is also one of the biggest advantages of petty bourgeoisie living in e-commerce.