Transforming business models to find alternative "breakouts" of traditional retailers' nets

More and more shops are pouring into a limited-capacity neighborhood. There is no doubt that the original business volume is also divided into fewer and fewer. As a result, some “restless” shopkeepers in the neighborhood are reluctant to continue to keep their unchanging sales, and they have begun to break through the sales radius of the block radius and seek new profit margins. In many industries in Taiyuan City, there are already some such stores that have secretly attempted to change from “business owners” to “business executives”. But going out of a small circle is not as easy as I imagined. If you rely on low-cost Internet, telephone and logistics distribution, and there are not enough attractive goods and services, then it is obviously very difficult for such peer-to-peer copying to achieve such “breakthroughs.”

A "Shang Shang" changed to "Business"

Zhang Kang's Plucky cosmetics discount shop has been open for nearly three years in Wuyi Square in Taiyuan. Similar stores in Taiyuan are scattered across large and small streets and communities.

Like Zhang Kang's cosmetics discount stores, if they can take root in a neighborhood for two or three years, such a store will not be much improved, at least, it will not be lost. However, just two years after the opening, Zhang Kang added an online shopping service in the same city based on physical discount stores. On February 17th, Zhang Kang and his partner Miu Wing-Hui were busy finishing the new version of the online shopping platform system in the narrow warehouse of the cosmetics store.

In fact, online shopping platform was quietly on the line before and after New Year's Day last year, but the manpower is not enough, Zhang Kang did not dare to promote with great fanfare. In spite of this, he still received a lot of business on the Internet, often staying in the store owner, and then carrying electric cars to order from the Internet.

Changing from “sit-seller” to “business-to-business” is also the beginning of his efforts to expand the range of sales in neighborhood stores. Zhang Kang had his calculations. In the past three years, he had accumulated two or three thousand member customers, of which about half were from Wuyi Square. Although there are not many orders from the Internet every day, after the online shopping platform was launched, the scope of delivery extended to several other urban areas in Taiyuan, which gave him a lot of confidence.

Li Xiaolin's Pepsi to help the Internet chain convenience store, almost quietly appeared on the streets of Taiyuan. The curiosity of customers who often visit convenience stores is that convenience stores have more "Internet" words. Since September last year, Li Xiaolin has opened six such convenience stores in Taiyuan. However, he is very clear that simply relying on the traditional business model of community-based convenience stores to realize the idea of ​​"small shops, big sales" is not realistic.

“In general, a traditional convenience store has a radiation range of 500 meters to 1,000 meters, but now there are more and more convenience stores, and the traditional sense has been shrinking.” He said that an independent convenience store must achieve A wider range of sales coverage can only be built more stores, but this stacking cost is very high.

Li Xiaolin didn't plan to spend all of his money on physical stores. His focus was on e-commerce, and physical stores were just a platform for him to achieve "small stores and big sales." His idea is to link these convenience stores through an e-commerce platform and not to need too many shops to cover the whole city of Taiyuan.

The convenience store itself is not much different from other stores around it. However, in addition to entity management and display promotion, Li Xiaolin's internet convenience store also provides around two kilometers of home delivery. According to the current plan, each convenience store has a scale of about 100 square meters. The single store is equipped with five staff members, including one or two delivery staff. When the order is busy, other staff members can also do delivery staff. As a result, the 500-meter sales circle has virtually expanded to about two kilometers.

Like traditional convenience stores and cosmetics stores, Chen Xiang opened the baby-care shop for two years in the community. The reason why Chen Xiang decided to make his sales circle bigger is because he began to purchase imported milk powder from Europe. He noticed that although there are many merchants who purchase imported powdered milk on the Internet, there is almost no physical store in the local market. Consumers' acceptance of this is not very high; and the local baby shop and milk powder specialty store do not provide imported milk powder purchasing service. He decided to use the imported milk powder purchasing business to bring more business to his own small shop.

Unlike ordinary consumer demand for pregnant women and infants, purchasing imported powdered milk cannot be based on customers in nearby communities. Chen Xiang also chose to use the same city online shopping to promote their own imported milk powder purchasing, and expand the circle to consumers in the same city in Taiyuan. Now, there are basically new customers in the six districts of Taiyuan City.

B. Efforts to step out of the circle

The lower and lower gross profit margins in the retail industry, the logistics and warehousing costs of door-to-door delivery, and the constant investment in the operation of online shopping platforms all add to the high cost of the “breakthrough” of convenience stores.

Li Xiaolin has established a 1,500-square-meter warehouse in Chengbei to facilitate rapid distribution to various convenience stores. He is not worried about the logistics and distribution problems. Now, he is busy with the decoration and opening of the remaining physical stores. Six months ago, he spent more time designing e-commerce websites.

Li Xiaolin did not purchase off-the-shelf third-party software, nor did he entrust e-commerce to others. Instead, he established a professional team to independently research and develop “Pepsi Helping Super ERP” software with completely independent intellectual property rights. Before starting operations, there were nearly 200,000 yuan per month for employees. Right now, there are still many places to spend money, because every convenience store that opens about 100 square meters, at least 300,000 yuan investment.

Unlike Li Xiaolin, Zhang Kang and Chen Xiang do not have enough manpower and capital to support the mature operation of “small shops and big sales”. They did not even set up warehouses and distribution points outside the store, and there was no redundant manpower for delivery. However, Zhang Kang and Chen Xiang feel that the pressure of distribution costs is not great, because cosmetics and milk powder have enough room for profit, and the amount of each item is still OK, the allocation of distribution costs is not too much.

Zhang Kang has given his website a very stylish name: Youfu.com. In the beginning, he intended to find a website company. Later, he met with Yonghui Yong, who has been engaged in the IT industry for many years. He then handed over the design and operation of the website to him. Zhang Kang did not plan to build logistics and warehouses for the time being. He intends to mature the site first. Zhen Yonghui told reporters that in order to achieve better online shopping, now they are making online shopping platform for the second time. However, the entire online shopping platform team is now only Yong Yong Hui, it seems a bit difficult.

Chen Xiang will simply hand over the online shopping platform to a website company. Chen Xiang's import of imported milk powder in a pregnant baby shop is purchased by one of his European friends. In order to win new customers, he allows friends to send milk powder to customers' homes directly from abroad using international express delivery. Old customers are usually booked in advance and then delivered directly from his baby shop.

It's not hard to find that these neighborhood stores that want to get out of a fixed business circle have their own uniqueness. For example, Zhang Kang's cosmetics shop is different from ordinary day-care stores. He targets mid-to-high end, but offers lower discount prices than counters and online shopping malls; Chen Xiang's baby-pregnant baby shop is destined to walk if it only depends on popular products. Not out of the circle of the district, but his purchasing of imported milk powder on the basis of the physical store brought customers outside the block to the small shops.

Although Li Xiaolin's convenience stores are not special in the categories of goods, he has to do differentiated competition. Li Xiaolin admits that several convenience stores that have opened have indeed formed direct competition with nearby stores, but their target audience for online shopping platforms does not conflict with physical stores. The free home delivery limit set by the internet convenience store is RMB 68. In a sense, this also fits with their target consumer groups. This group of customers does not have much time to go to the supermarket to line up for shopping, or just need some daily necessities, but the categories of convenience stores cannot meet their needs. This time You can complete the shopping through the delivery of the Internet convenience store.

C District Shop's "Limited Dream"

In order to attract more suppliers, Li Xiaolin gave the suppliers a zero-cost preferential admission mode. By reducing the concept of cooperation between the intermediate links, the best purchase channels, and the day-end settlement, the purchase price of commodities was greatly reduced; at the same time, The low cost advantage of online supermarkets will ultimately save this part of the cost.

“A lot of brand distributors have been required by the factory to enter the designated supermarket stores, but these supermarkets have various entry fees, and some brands even lose money in the supermarket channel. But there is no way to get the general agent. , you have to enter the supermarket." Li Xiaolin said that these general agents can only profit through other channels.

Although there is a shortage of suppliers, what Chen Xiang needs to solve most is also the source of supply. In Europe, some countries have subsidies for milk powder, so the retail price of high-quality milk powder is not expensive, and even if you add tariffs and freight, you can still make a lot of profit. But the problem is that it is difficult to get large quantities of goods now, and private mail is also limited.

When the business hasn't really covered the entire city, Chen Xiang has been a bit overwhelmed. He has to choose to maintain his old customers and give up new customers. What makes him even more uneasy is that Taiyuan already has other purchasing websites that are scrambling for this piece of cake, and his website has faded out of the home page of the search network. Avoid being quickly followed by peers and become the next most embarrassing thing for him.

Zhang Kang is different, since Kuang Yonghui joined, he no longer worried about the operation of online shopping platform. Years ago, a friend of a venture capital company was very optimistic about this project after learning his idea, and he also made a share of money. Zhang Kang feels that he does not make any money now. If necessary, he can get investment from this venture capital company at any time. "But I want to do it myself. After I have had a good flow of water, I will talk to the venture capital company. Then we will have more confidence."

After continuous contact with suppliers, Li Xiaolin has increased the online shopping platform's product category to more than 20,000, and he has even reached a joint-stock commercial bank in the provincial capital to launch a third-party regulated member shopping stored value card. According to the plan, by the end of June, the number of Internet convenience stores had reached 15 and the number had grown to 30 at the end of the year. This number was enough to cover the area he wanted. In addition, he also plans to build a distribution warehouse in the south of the city. "If our model is successful enough, the next step is to copy it to the second and third-tier cities." Li Xiaolin said that the first-tier cities are too fierce and they are becoming saturated, and they will not go there.

Before the entire process had not matured, Zhang Kang and Yu Yonghui did not plan to promote it. Only on the March 8th Women’s Day, which is about to come, they will conduct a small-scale trial against the existing thousands of member customers. Zhang Kang has no urgency to allow venture capital companies to come in and have their own considerations. In his view, traditional retail and e-commerce are entirely two different areas.

Both Zhang Kang and Chen Xiang realized that without this platform, some customers who are far away or inconvenient to shop may lose their places, and the emergence of online shopping platforms may make these consumers become their own faithful. customer. At least from this point of view, even if it fails to “go out” in the end, the online shopping platform will have its own value for its own store.

On the newly revised website introduction page, Zhang Kang and his partners confidently wrote a sentence: On the e-commerce stage where billions of dollars are invested, Don Quixote like us, we have a small ideal, we have a unique way. , With a single breakthrough in the innovative model, the "superior +" level of service from the bottom up.