The concept of the front-end warehouse model: The front-end warehouse is a warehousing and distribution model. Each of its stores is a small and medium-sized warehousing and distribution center. This allows the central warehouse at the headquarters to only supply goods to the stores and also cover the last step.

kilometer.

After consumers place an order, the goods are shipped from a nearby retail store rather than from a warehouse far away in the suburbs.

This is an important prerequisite that enables it to achieve 30-minute delivery within 3 kilometers of the store.

To put it simply, a front-end warehouse is a small warehouse set up close to the consumer, maybe an office building or a community. When users place an order, it can be delivered to their door within 1-2 hours.

Hema Fresh, Wonderful Life, Tiantian Orchard, Daily Fresh, U Shopkeeper, etc. have all used or are currently using this model.

Advantages of the front-end warehouse model: The front-end warehouse is not simply a matter of splitting a large warehouse into small warehouses for distribution. That is still a pure e-commerce thinking.

Thinking about it from another angle, the front warehouse model is essentially to use an area of ??200 square meters to 300 square meters to carry more than 2,000 SKUs of more than ten major fresh food categories.

In terms of area, this is the area of ??a convenience store. In terms of category coverage and customer base, this is the customer base and coverage capacity of large and medium-sized lifestyle supermarkets.

So in a nutshell, front-end warehousing is to use the low-cost model of a small store to create the breadth of categories and depth of services of a large store.

In other words, why is it that the typical formats of Chinese commerce are large supermarkets with an area of ??10,000 square meters and convenience stores with an area of ??100 square meters? Where is the middle area?

This is because in the traditional store cost structure, convenience and scale effects have become mutually exclusive. If you want convenience and freshness, you cannot go up in scale; if you want scale, you cannot take into account both freshness and convenience.

The front-end warehouse model breaks away from the traditional store opening model and tries a new middle route.

Frankly speaking, the average store area is 4,000-5,000 square meters, and Hema, which adopts a front store and back warehouse model, has a similar idea.

However, in comparison, the front-end warehouse, which saves the cost of opening a store, has lower initial investment.

In terms of picking efficiency, it seems that the front store and the back warehouse are not inferior, but in fact there is another set of inventory to meet the challenges of the two channels (stores and distribution).

The reason why the front-end warehouse model emerged is that with the improvement of living standards and the acceleration of the pace of life in big cities, people hope to live a "fast and good" life, hoping to find the best combination between the time cost of purchasing and the cost-effectiveness of goods.

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What front-end warehouses pursue is the combination of the scale of large stores and the convenience of small stores. It is the third way besides large and small, that is, closeness, comprehensiveness, and quality. This is almost the ultimate goal of new retail.

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The advantages of the front-end warehouse model mainly include the following aspects: 1. Timeliness.

The front-end warehouse model can make store delivery more timely. After consumers place an order, it is shipped from the nearest warehouse, that is, an additional retail store is shipped, and can be delivered to the customer in a short time.

Second, cold chain fresh food delivery is fast and low-cost.

Regarding the front-end warehouse model, it refers to a small storage unit close to consumers, so it is generally set up nearby.

Therefore, whether it is the speed of order response or the cost of delivery, in comparison, the front-end warehouse model has great advantages.

Disadvantages of the front-end warehouse model: Although the front-end warehouse has obvious advantages in terms of experience, for the platform, the operation is extremely difficult mainly in two aspects: 1. Due to the uncertainty of orders, the uncertainty of losses

sex, and there is also the issue of how to replenish supplies.

2. Due to the differences in consumers in each location, there are differences in category operations and prices. This is true even in multiple regions in a city. If it extends to the whole country, for example, the taste of consumers in North China and East China is different, the complexity will increase greatly.

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The front warehouse is a demanding operation, and the conditions of the 3 kilometers radiated by each front warehouse are different.