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Author | Fan Xiangdong
Source | Gaojie Gaoshen (ID:gjgc168)
The header picture is from the poster of JD.COM New Access Road, edited and published by Tiger Sniff.
According to the list and report released by China Chain Store & Franchise Association recently, in 2118, the efficiency of large supermarkets, the main retail format of FMCG, decreased by 8.1% on average, the total salary of employees increased by 13.1%, and the rent increased by 11.6%, which generally led to the dilemma of weak growth.
The growth rate of convenience store industry is obviously better than that of supermarkets and department stores. In 2118, the sales scale of the top 111 convenience store enterprises increased by 21.1% year-on-year, and the number of stores increased by 18.1%. This also corresponds to the lifestyle of young people giving priority to efficiency, and the retail and catering formats with community as the service radius will become the growth point of future retail.
However, this list mainly focuses on modern chain convenience stores, without mentioning the main convenience store format-husband and wife store. There are more than 6 million couples' and wives' shops in China. These shops are small in size, and most of the operators are middle-aged. However, 41% of fast-moving consumer goods in China come to consumers through them, which has an important impact on Chinese consumption.
Compared with chain convenience stores, traditional couples' wives' shops have obvious pain points: brands and terminals store multi-level distribution, which leads to slow commodity circulation and high cost; Small shop operators are relatively weak and lack funds and methods to improve their sales and service capabilities. Small stores want to change, not only in the operators themselves, but also in the distribution system of FMCG behind them.
Business opportunities are among them. This is a billion-dollar market coveted by Ali and JD.COM. Tmall stores and JD.COM convenience stores seem to seize the terminal, but the ultimate goal is to quickly reconstruct B2B channels and integrate terminal data. Therefore, fast-moving B2B once became a popular track, and entrepreneurs, traditional supermarkets, e-commerce platforms and even logistics companies came to grab the fat of this "old city reconstruction".
Looking back, however, the fast-moving B2B platforms such as Ali Retail Link and JD.COM New Channel have "stepped into the air" and fallen into the "trap" of the traditional wholesale industry.
princes dance wildly, and life and death are both uncertain
"I have more than 5 million tobacco license documents of husband and wife's shop here." Wang Qiang turned on the computer and found the information of a small shop in my hometown. This naturally surprised me, but Wang Qiang was not happy. He couldn't use these data because his fast-moving B2B platform closed down last year.
"I can't go on without figuring out how to make money." Wang Qiang is talking about himself, which is also a common problem in this industry. Compared with 2117, the total financing of FMCG B2B industry decreased by 75% last year, and many players who rely on capital transfusion to make a living can no longer support it. Last year, there were about 171 FMCG B2B platforms in China, about 41 of which closed down, and some of them began to transform.
With Wang Qiang, there are many industry leaders, such as Zhenge and Jingwei Investment's Store-to-Store Interconnection. The financing failure led to the break of the capital chain, and world cooperate, the palm of HNA's background, stopped operating at the end of May last year. Even if the giant is blessed, it will not be spared. Huidan took two rounds of investment from Tencent and Ping An Overseas last year. As a result, it failed to operate at the beginning of this year, and the cruelty of the industry can be seen.
Of course, in the business law of survival of the fittest, there will still be some industry stars who are not short of money. An investor told the author that he was optimistic about Yijiuban (formerly known as Yijiuban), which also appeared in the article of Tiger Sniff Gaojie Gaoshen, focusing on alcohol and cooperating with the B2B business of Meituan. Yijiubai was strategically invested by Meituan in 2116. Last year, Yijiubai received a $211 million D round investment from Meituan and Tencent. In March this year, Yijiubai was merged into a $1 billion D+ round.
it is estimated that you have also noticed that both Huidan and Yijiu have Tencent's investment. Dalian Lock on the modern access has stood in line between Ali and Tencent, and the fast-moving B2B platform for transforming the traditional access has also been clearly defined.
Tencent has invested in Huidan and Yijiu Approval, and JD.COM has a new channel. Last year, it strategically took a stake in Zhangworld cooperate's parent company Supply and Marketing Collection. In addition to Yijiu Approval, Meituan's industrial fund Longzhu Capital also invested in Pocket Fast Retailing.
Look at Ali's side. In addition to its own retail link, last year Ali invested in Huitong, which is mainly engaged in rural markets. Together with Best Store Plus and RT Mart E Road Fa, it also brought together four head platforms.
The above-mentioned B2B platform, as well as the state-owned big brother Yi Yatong, and the Chinese businessmen who have not yet stood in line, are basically the head forces of the industry.
When giants enter the stadium, the fast-moving B2B circuit will be difficult to win the favor of capital again, and the industry concentration will be higher and higher. Basically, people in the industry interviewed by Tiger Sniff think that more fast-moving B2B will fall this year, and the fatal factor is "unprofitable". A practitioner told the author that there are very few M&A cases in the B2B field, because most players "have no assets but debts" and have no M&A value at all.
At present, there are only a handful of fast-moving B2B platforms that can make profits. Except for the listed company Yiyatong, only a few platforms such as Caihua Commerce, Yijiupan and New Gao Qiao have news of profits, and even the retail outlet, which ranks first in the industry, is in a loss state.
Some time ago, Retail Link made internal adjustments. According to many media reports, Retail Link required all individuals to sign a new agreement before April 1. In the past, the partner's income mainly came from the product sales commission, and the new agreement gave the partner a basic salary, but because the product commission income dropped sharply, the partner's income generally declined.
The salary composition reflects the changes in the positioning of retail partners. "Partners are no longer a sales system but a service system." Lin Xiaohai, general manager of the retail business department, told Hu Wei: "At present, the salary of partners is in the form of basic salary plus bonus. The salary is mainly affected by the quality of service, and the proportion of product sales commission is very small."
However, the salary adjustment of retail channel partners is synchronized with the platform subsidy of retail channel, so it is not difficult to see that retail channel wants to reduce costs. In addition, Retail Link has now covered 1.3 million retail stores nationwide, with more than 5,111 brands and distributors. Perhaps "staking the land" will come to an end and focus on the refined operation of the covered stores.
in short, the basic pattern of this industry has been set, but the profit problem has not been effectively solved.
The "Three Doors" of Fast Selling B2B with Short Life
It must be said that it is feasible to achieve the business logic of saving costs by integrating traditional channel data and establishing an efficient distribution platform. But the actual situation is cruel, even if a fast-moving B2B platform wins two rounds of financing a year, it still can't survive. What's the problem? Is the business model unworkable, or is the execution not in place?
1. Get the goods, there is no price advantage
Almost all FMCG B2B platforms have a "hard injury": they may not be able to get the goods directly from the brand, and even if they do, the price is not cheaper than that of traditional dealers.
on the surface, the platform is to devour the dealer's market, but in the whole distribution system, the brand that determines the price of goods is the strongest party and the biggest beneficiary of the distribution channel. The most typical example is Wahaha. Zong Qinghou once said that Wahaha "has heavy product weight and low total value, and e-commerce is not easy to do", and it is not "cold" for Ma Yun's e-commerce. It is through the benefit distribution mechanism that brands and distributors become the same body of interests, so that brands can have a stable cash flow reservoir.
the multi-level distribution system of the brand, the first level is the general agent in the big region, and then it is divided into urban distribution companies and individual wholesale merchants. No matter what kind of system design, if you want to get the agency of the brand, you have to pay a lot of agency fees every year. With the help of the dealer system, the brand can spread channels at low cost, which may be inefficient, but it is in its own hands and can make some active decisions, such as launching new products.
Therefore, brands are concerned about the fast-moving B2B platform. Lin Xiaohai also said that brands have been excluded, but after seeing the growth, brands are gradually willing to cooperate with retailers, but when brands give goods, the price is relatively high, and the price is similar to that of dealers.
vaguely, I can feel the attitude of the brand: the dealer wants to maintain it, but the brand pays a higher shipping price to the FMCG B2B platform and earns more. "Brands don't want to destroy the original channels and don't refuse incremental distribution." Wang Qiang said that the brand will set up a new channel department or a special team to supply B2B platforms with a set of different commodities and price systems.
Therefore, whether you get goods from dealers at the beginning or do business with brands directly after accumulating a certain scale, the prices of goods obtained by FMCG B2B platform are relatively high. The B2B platform is inevitably subsidized and enters the market with a low price strategy. Low prices can attract bonus hunter, a small shopkeeper, but it's hard to stay after the subsidy is stopped. The B2B platform on this road will be in a dilemma and can't get money, and the result can be imagined.
(The service stations in world cooperate are blocked by suppliers for payment, the source is shown in the watermark)
2. The whole category is getting worse and worse
As far as brands are concerned, dealers and FMCG B2B are their own businesses, but the two channels are facing the same consumer groups, which is a competitive relationship that is difficult to reconcile.
in the physical circulation, the most basic thing is the warehouse allocation ability, which is also the value of the dealer to the brand. From the mode, FMCG B2B platform has more cost advantages. After the infrastructure is set up, warehouses and salesmen can be used by all brands, saving industry costs.
However, the gross profit of 2B is very low. As mentioned above, the price of FMCG is relatively transparent within the industry, and the ex-factory price and terminal price are limited by the brand. In commodity circulation, warehousing, personnel salaries, vehicles and so on are hard costs, no matter how efficiently warehouses are divided and dispatched. Therefore, if you want to cover the costs with limited gross profit margin, you must increase the unit price of customers.
whether it's FMCG B2B or catering B2B, there is a concept called "bicycle profit". Wang Chaocheng, the founder of Easy Wine Batch, once said the importance of bicycle profit, which roughly means that the delivery cost of 2B is fixed. A gold cup delivers goods at a time, and the cost is 311 yuan. What is delivered on the car determines whether the car can make a profit. If it's a car full of wine with a gross profit of 3%, then this car is profitable. If it's a car full of drinks with a value of 5,111, it needs at least 6% gross profit to even out the delivery cost.
The goods in small shops can be simply divided into two categories. One category is high-frequency and low-profit bulk goods, and the most typical one is water and drink with rigid demand in small shops. The other category is low-frequency but high-profit goods, such as alcohol and snacks. Fast-moving B2B platform needs to subsidize the sales of some goods to ensure the stickiness of small stores, but it should be covered by profitable categories.
"All B2B platforms that have problems are basically all categories." Wang Qiang said that this road may not be suitable for entrepreneurs. "Convenience stores can be all categories, because there are activities of fresh food and matching sales. If the gross profit can't even cover the fixed cost, even if the order density is made, it will be more and more costly. "
3. The compliance cost is high
Even if the business of B2B platform is successful, there is still an unavoidable "compliance cost" for B2B platform in the future compared with distributors.
"Few people say this." Wang Qiang said, "Although it is somewhat exaggerated, FMCG products are all outside the tax system." Dealers and wholesalers make money, in fact, some of them are missed taxes. Individual wholesalers at the terminal get the goods, and small shopkeepers buy the goods. No matter whether they are on credit or cash, there is basically no invoicing, and there is no so-called input ticket deduction. It is difficult for countries to check one by one. They pay their own profits and losses, and the business itself remembers that it is close to ten, which may be why individual industrial and commercial households set a fixed tax.
"The challenge of the fast-moving B2B platform is not only the business model, but also the tax relationship." Wang Qiang said. All orders and transactions of FMCG B2B platform will be recorded, and the future listing will definitely operate in compliance. In the current tax environment, the cost of fast-moving B2B platform is definitely relatively high.
why continue your life?
"These problems have been talked about again and again, but most B2B platforms haven't found a solution yet." Wang Qiang sighed. After some visits and exchanges, Tiger Sniff summarized several possible breakthrough directions:
1. Maximize the value of fixed cost
Eliminate B2B quickly. No matter how to earn the price difference of goods or the service fee of the platform, the efficiency of commodity circulation is considered, and the requirements for platform capabilities are similar, such as the most basic warehouse allocation ability, which can develop the unified warehouse allocation business.
To be a self-operated fast-moving B2B platform, you can also access dealers, such as JD.COM New Road. At first, you will be self-operated, and then you will be open to POP (platform opening). You will open logistics, warehousing, funds (supply chain finance) to dealers, and promote cooperation methods such as agency, distribution and consignment, so as to improve the cost utilization efficiency through * * *.
In addition, B2B is naturally suitable for supply chain finance, and it is also considered by practitioners as the most feasible way to make profits. Third-party orders, transactions, warehousing and other business activities are all on the platform. After accumulating transaction data, we can build suitable supply chain financial products and sell them to upstream and downstream customers, or help banks to make risk-controlled loans.
2. The breakthrough point with the fastest effect may be the channel's reverse brand differentiation customization
category. For example, the demand for wine is stable, and the product differentiation of various brands is also obvious. The unit price of customers is high, which is a few dollars more expensive, and consumers are not sensitive enough. But if there is water, a bottle is two dollars, without Nongfu Spring, Wahaha and Ipoh, there is no problem, so we must fight for every profit.
Lin Xiaohai believes that the core competitiveness of B2B platform is still in commodities. Generally, there are about 311 SKUs in high-frequency sales in small stores, which account for 31% of the platform sales. The retail association will provide the most stable supply, price and service.
in addition, retail links should also integrate market capacity, small store consumption scenarios, brand resources and other factors to collect a plate of channel-specific products, such as sanitary napkins, typical small store consumption products; There is no brand of umbrella that can cover the whole country, the price is opaque, and the gross profit space is huge. "
B2B can also do channel customization. For example, JD.COM New Channel was launched in Beijing, JD.COM's own brand, and the key word was super high gross profit. However, if FMCG brands have no sense of existence, most of them can't escape the fate of slow sales. It is worth mentioning that the landing of e-commerce brands is a good breakthrough in categories. After the online traffic dividend has passed, online brands are seeking ways to go offline.
3. Earn the money put by the brand in the market
The brand has reached the consumers and understood the marketing of the terminal goods.