First, the impact of the epidemic.
Since last year, although there has been no large-scale epidemic similar to that in 2020 in China, there are still sporadic epidemics in many parts of the country. Once the epidemic breaks out, all localities will take emergency epidemic prevention and control measures. Among many epidemic prevention and control measures, offline closing stores is basically the most common. Once the store is closed, the loss is very heavy for the physical store.
In addition to paying high rents, physical stores also need to pay employees' salaries. For industries represented by fresh food, because vegetables, fruits and other products require fast circulation, if the store is closed for a long time and there is no cold storage, it means that these physical stores must also bear the cost of commodity loss. In the case of multiple costs added together, what does a physical store rely on to achieve profitability?
Take the catering industry as an example. Because the main body of China's catering industry is small and medium-sized enterprises, limited by capital, manpower and material resources, there is a certain gap between small and medium-sized enterprises and large enterprises in chain operation and market concentration. However, if the proportion of small and medium-sized enterprises in an industry is too high, the concentration of the market will often be low, and the scale effect of the industry is not significant.
In today's increasingly fierce competition in the catering market, small and medium-sized enterprises will show a series of problems such as high customer mobility, insufficient stickiness, unsatisfactory use of online platforms, and tight cash flow. The results of China Catering Annual Report show that the market share of the top 100 catering enterprises is only 7%, and the main composition of the catering market is still small and medium-sized enterprises, and there is still room for improvement in standardization and market concentration.
As the epidemic continues, the advantages of large chain enterprises are highlighted at this time. Through good brand image, huge scale and sufficient funds, they have demonstrated great self-help ability and tenacious vitality in crisis management. In contrast, the self-help ability of small catering enterprises is slightly insufficient.
At the beginning of the epidemic, most small catering enterprises were forced to accept the blow brought by the epidemic, but some brand catering enterprises were able to take the initiative to respond according to the development trend of the epidemic, constantly update and optimize their business models, give full play to their existing resources to provide anti-epidemic assistance, on the one hand, reduce losses as much as possible, on the other hand, establish a good brand image and improve social influence.
In the financing ability of small and medium-sized catering industry, large chain enterprises are more likely to obtain bank loans and social support than small enterprises. In the sustained development stage of the epidemic, some small catering enterprises with tight capital flow or even broken chains closed down one after another, while some large chain enterprises took this opportunity to expand financing. The excessive dispersion of industrial capital makes the catering industry dominated by small-scale enterprises obviously lack the ability to resist risks.
Second, the epidemic has led to a decline in people's income.
According to the relevant theories of economics, the factors that affect people's consumption have a great influence on people's expected income in the future besides their current income. For example, in the first two years before the outbreak, when I saw a dress of several hundred yuan in a shopping mall, I would buy it without thinking, even if I used a credit card.
Because everyone is optimistic about their expected income at this time, but as the epidemic continues, the cost of raw materials has continued to rise since last year, and corporate profits have been severely compressed. In this case, many small and medium-sized enterprises either fall into bankruptcy or save themselves through layoffs. Even last year, Internet companies that were once regarded as high-paying industries were caught in a wave of layoffs.
At this time, people are generally pessimistic about the expected income in the future, which also leads everyone to dare not spend at will even if they have money. On the contrary, it will put money in the bank to resist the uncertain factors of future families. When people are afraid to spend, it will also make China's consumer market fall into a trough. How to make money in business under such circumstances?
Third, the influence of e-commerce industry.
In fact, the impact of e-commerce on the physical industry did not start from last year. It has had a long-term impact on entities, especially in the past two years when the epidemic broke out. The rapid rise of live e-commerce has made the living space of many physical stores worrying. E-commerce has many influences on entities, such as price, trading time and space, cost and so on.
For example, the Spring Festival is coming, and every household begins to buy new year's goods. For the same new year's goods, the price in your area is 200 yuan, while the price in Duoduo is 120 yuan. At this time, many people will choose to buy in Pinduoduo. For physical stores, this also means a serious loss of customers. But this kind of loss, the owner of the physical store is imperceptible. However, compared with e-commerce channels, it is difficult for physical stores to lower prices.
The reason is that among the costs of physical stores, rental costs and personnel costs account for a high proportion. Even many entity bosses joked that they were working for the landlord. In the case of relatively high cost, the entity boss can only achieve profit by raising the price of goods. Otherwise, for physical stores, it is a loss. But it also makes the business of physical stores more and more difficult to do, and there is no good way to solve this situation in the short term.
Summary:
From the above analysis, although our country has a large population. However, the consumption power brought by the huge population is limited, especially in the past two years, under the impact of the epidemic, Chinese people are generally pessimistic about the expected income in the future, leading to serious degradation of the consumer market. Obviously, this situation will not be improved very well in a short time.