Supermarket positioning refinement model innovation iteration continues to advance

Reporter Wang Xiaoxuan

According to the "Report on the Operation of Chain Supermarkets (2022)" (hereinafter referred to as the "Report") released by the China Chain Store and Franchise Association recently, due to the continuation of the epidemic and the superimposed external economic impact, the sales performance of China's chain supermarkets in 2021 was not optimistic, but the sales in the first half of 2022 improved, nearly seventy percent of the sample enterprises sales decreased compared with 2020, and nearly thirty percent of the sales increased year-on-year
.
Enterprises with an increase of 0%-10%, mainly enterprises of 3 billion yuan to 10 billion yuan; Enterprises with an increase of more than 10% are mainly
enterprises with less than 3 billion yuan.
The number of stores is still growing in 2021, and the pace of store opening slows down in the first half of 2022; Industry earnings declined in 2021, but net profit improved in the first half of 2022; Comparable same-store sales were negative, but online sales grew rapidly
.

Listed supermarket companies achieve profitability

Based on the development of supermarket formats in 2021, the "Report" conducts statistical analysis of key indicators of supermarket operation from the enterprise level and store level according to the survey data of China Chain Store and Franchise Association, calculates the industry average from four dimensions: enterprise sales scale, store scale, enterprise headquarters area, and supermarket subdivision format
, and provides supermarket enterprises with benchmarking benchmarks for business indicators.
For the first time, the data of supermarket segmentation formats was separated from enterprise data according to business formats, which was more accurate
than before.

In 2021, the sales scale of Top100 supermarket enterprises will be 907.
6 billion yuan, a year-on-year decrease of 2.
6%.

Compared with the top 100 supermarket enterprises in 2020, the sales scale decreased by 60.
4 billion yuan, down 6.
2 percentage points
.

2021 is the second year of the outbreak of the epidemic, and due to the high base in 2020, most supermarket sales fell
year-on-year.
In 2021, under the multiple pressures of supermarket enterprises such as operation and epidemic control, the cumulative growth of sales showed a trend
of high and low.

In the first three quarters of 2022, the sales of supermarkets above designated size continued to improve, with the cumulative growth rate of retail sales increasing from 3% in February to a high of 4.
2% in June, a slight decrease of 4.
1% in July and August, and a slight decline in the fourth quarter, with a slight decline in November
, 3.
1%.
Compared with other retail formats, supermarkets performed the most stable
.

In the first half of 2022, the revenue of listed supermarket companies was better than that of 2021 and the same period in 2019 before the epidemic, and achieved profitability
.

Judging from the performance of listed supermarket companies, the revenue of listed supermarket companies in the first half of 2022 was better than that of 2021 and the same period in 2019 before the epidemic, and achieved profitability
.
Entering the third quarter, revenue continued the growth trend in the first half of the year, and profit turned into a loss, but it was narrower
than the same period in 2021.

The number of stores is still growing in 2021, and the pace of store opening slows down in the first half of 2022 According to the analysis of the report, the total number of Top100 supermarket enterprise stores in 2021 will be 28,502, a year-on-year increase of 2.
9%.

There was a net increase of 795 stores, with store growth significantly slower than in 2019 (6.
6%) and 2020 (7.
4%)
.
The largest increase in the number of stores was in the fresh supermarket Qian Dama and discount supermarket Hao Sale, with a total net increase of 783 stores, while the total net increase of other enterprises was only 12.

In the first half of 2022, the pace of store opening by listed supermarket companies slowed down
.
As of the first half of 2022, the 9 listed companies added a total of 45 net stores
.
Among them, the number of convenience stores increased by 69 and the number of
supermarket stores decreased by 22.

Industry profits declined in 2021, and net profit improved in the first half of 2022 Seventy percent of companies' net profit decreased year-on-year in 2020, 5.
1 percentage points
more than companies with declining sales.
The net profit of 20% of enterprises increased
year-on-year.
Among the enterprises with flat net profit and positive growth, 82.
0% are enterprises
with sales scale of less than 10 billion yuan.

The overall average gross profit margin of the sample supermarkets was stable at 18.
2% in 2021, unchanged
from 2020.
The average net profit margin fell significantly, from 1.
9% in 2020 to 0.
6%.

In 2021, several leading companies such as listed supermarket companies such as Yonghui, Jiajiayue, Renrenle, Hualian Comprehensive Supermarket, Zhongbai Group, and Lianhua Supermarket all suffered losses, and the profitability of the industry dropped
significantly.
In the first half of 2022, the profitability of listed supermarket companies improved, with a total net profit of 46.
71 million yuan, better than the same period in 2021
.
Entering the third quarter, earnings turned into losses, but narrower than the same period in 2021
.
The expense ratio of listed supermarket companies continues to grow
.
Fees include selling, overheading, and finance expenses
.

Comparable sales of same-store in 2021 are negative, and subdivision formats are differentiated In 2021, the comparable sales of supermarket enterprises decreased overall, with large supermarkets falling relatively least, -3.
4%, and community supermarkets showing the largest decline of -8.
0%.

From the perspective of the city level where the headquarters are distributed, from the first-tier to the fourth-tier cities, the comparable data of the same store decreased from more to less, reflecting the delay and sensitivity
of economic transmission in different administrative level cities.

Overall online retail growth slowed down in 2021, and online sales of physical supermarkets grew rapidly In 2021, online retail sales of physical goods reached 10.
8 trillion yuan, accounting for 4.
5%
of the total retail sales of goods.
As of the first half of 2022, this proportion rose to 25.
9%, but it is still lower than the 27.
7% ratio
in 2020.
As the growth rate of online retail sales of physical goods slows down, the proportion of online and offline distribution will gradually become more balanced
.

From the year-on-year increase in sales on Tmall Double 11, the increase was less than 10% for the first time in 2021; JD.
com's sales growth rate on Double 11 also declined, from 32.
83% in 2020 to about
28.
58% in 2021.
At the end of Singles' Day in 2022, major platforms no longer publish specific GMV data and growth data, and began to shift the focus of publicity to the introduction
of consumption highlights.

Segmented business formats Focus on target customers

Faced with the impact of the epidemic, rising food prices, difficulty in recruiting workers, etc.
, under the guidance and promotion of a series of policies, supermarket enterprises have strived to overcome operational difficulties, focus on target customers and explore optimal solutions
for development through multi-brand, multi-segment, multi-store type, and multi-channel development models.
In the past two years, membership stores and discount stores have developed well, and supermarket companies have gradually tried to enter
.

Omni-channel integration has gradually deepened, the proportion of online sales of physical supermarket enterprises has continued to increase, digital technology investment has increased, digital membership has grown rapidly, the unit price gap between offline and online customers has narrowed, and the online channel operation model has become increasingly segmented
.
Achieving profitability in online business has become a real challenge
for enterprises.

In order to improve operational efficiency and strengthen competitive advantage from the source, supermarket enterprises optimize procurement channels, build direct procurement bases or direct procurement in China and overseas, and extend their business to the forefront
of the industrial chain.
Strengthen the construction of characteristic products and self-branded products, and create new IP co-branded products; Build a matrix of characteristic products based on private label products to create a flexible private brand
.

In response to increasingly differentiated consumer demand and more diversified consumption channels, brick-and-mortar supermarket enterprises focus on target customers
through the development model of multi-brand, multi-segmented format, multi-store type and multi-channel.

Community fresh supermarkets also target different customer groups, market segments, and refine store classification
.
In addition to refining brand positioning, supermarket companies are also experimenting with new models
such as membership stores, discount stores, and compound stores.
Yonghui, Jiajiayue, Wumart, Huaguan, etc.
have tried membership stores and discount stores
.
Jingdong Seven Fresh Supermarket and MUJI joined hands to build a fresh complex store and explore a "food proposal" supermarket
.

As a representative of new retail, Hema Fresh has also tested the water of "Hema Station", "Hema mini", "Hema Market" and "Hema F2" and other store models, and after continuous iteration of trial and error, it now retains the four types of store models
of "Hema Xiansheng", "Hema X Member Store", "Hema Neighborhood" and "Hema Fresh Outlet".

The development of member stores has accelerated, supermarket companies have tried to enter the market, and the development
of member stores has accelerated since 2020.
The success of Costco's first store in China and the good performance of Sam's Club have made supermarket companies realize the potential
of the membership store model.
According to incomplete statistics, there were 27 existing stores of major brand membership stores in 2019, 33 in 2020, 123 in 2021, and 189 in 2022
.
Excluding Yonghui, which uses estimated data, the number of member stores will increase by 6, 37 and 9 respectively every year from 2020 to 2022
.

Community business creates a better and happy life

Under the background of the government's introduction of policies related to the construction of a quarter-hour convenient living circle in the city, giving play to the role of the living circle as convenient, beneficial and beneficial to the people, many convenient fresh retail stores such as community supermarkets, fresh food stores, and fruit stores have achieved rapid development, and the proportion of fresh goods has also further increased
.

The "Report" shows that when Aunt Qian, Pagoda, Hongjiu Fruit and Xianfeng Fruit have obtained multiple rounds of financing and embarked on the road to IPO, potential brands continue to obtain financing, constantly iterate store models, and increase market share density; Meituan, Pinduoduo, Alibaba, and JD.
com have entered the community business field to explore new growth opportunities
.
Even Beijing Lianjia Land Real Estate Brokerage Co.
, Ltd.
, a real estate agency, has enhanced its ability
to serve the community by setting up community select convenience stores.
Lianjia also cooperates with Meituan and Pinduoduo, and stores are connected to community group buying business
.
Various businesses around community scenarios have become a must-compete place for many retail companies to reach consumers
.
From the specific business data, the human efficiency of community supermarkets has improved, the unit price of customers has increased, and the number of inventory turnover days has been shortened, showing more optimistic results
.

China Food News(2023.
01.
06.
07)

(Responsible editor: Gao Na)