In the bustling Beijing Centergate Technologies (Holding) Co.Ltd(000931) square, Carrefour, a super hypermarket opened along the street, the signboard above the door and the reminder of business hours have not been removed, and the publicity posters and banners inside the door are still eye-catching, but the closed door shows that the bustling scene in the past no longer exists.
On March 31, 2022, the Carrefour Beijing Beijing Centergate Technologies (Holding) Co.Ltd(000931) store, known as “Asia’s largest flagship store”, was officially closed. The store covers an area of 32000 square meters and has been operated for 18 years.
Hearing the news, Chen Lei, who had studied in a graduate school near Beijing Centergate Technologies (Holding) Co.Ltd(000931) was surprised. Seven years ago, she came to Beijing from Wuhan to study. The first thing she did after she put down her luggage was to punch in at Carrefour near the school. “I like to eat durian sold by Carrefour most, which is the best and freshest she can buy. Watching the sunset and eating durian in the square next to Carrefour every weekend is one of her most enjoyable moments,” she recalls
Carrefour is not alone in closing its stores. The traditional supermarket, which once developed rapidly, now has insufficient stamina. Beijing Metro Wanquanhe store, which has been open for 16 years, officially closed on April 10 this year; At the end of February, the China Resources Wanjia supermarket on Zhichun Road in Beijing was closed; On February 24, a Wal Mart store in Guangzhou, which has been operating for nearly 20 years, closed down. According to incomplete statistics of yingshang.com, in 2021, 13 supermarket enterprises monitored closed more than 100 stores in the whole year, including Renrenle Commercial Group Co.Ltd(002336) 37, more than 30 Wal Mart and more than 20 Carrefour. In addition, Yonghui, RT mart, Yongwang, Bufeng lotus, China Resources Vanguard and other traditional supermarket brands also have relevant stores.
However, with the decline of physical retail, the development of e-commerce and community group purchase has entered a fast lane. According to the e-commerce database of “dianshubao” of ecosoc.com, the transaction scale of fresh e-commerce reached 465.81 billion yuan in 2021, compared with 29 billion yuan in 2014. According to the research report released by ecosoc.com, in 2021, the transaction scale of China’s community group purchase market reached 120.51 billion yuan and the number of group purchase users reached 646 million.
“The retail market is ever-changing and new models emerge one after another. At present, everyone is doing o2o to earn private traffic. Traditional hypermarkets will face unprecedented fierce competition.” Tao Wensheng, a partner and retail expert of Peking University, told the reporter of times weeklyP align = “center” reasons for closing
Regarding the closure of Beijing Centergate Technologies (Holding) Co.Ltd(000931) store, an insider of Carrefour told the reporter of times weekly that ” Beijing Centergate Technologies (Holding) Co.Ltd(000931) square needs to be upgraded, so the store is closed.”
Wal Mart closed its stores for different reasons. The reporter learned from Wal mart that the Xiamen Wal Mart World Trade mall store to be closed on April 27 is to better aggregate Wal Mart’s store resources in Xiamen, so the business is suspended. In some stores, the owners will not renew the lease because the lease expires.
As for the lease of such traditional hypermarkets, according to Caijing magazine, the lease term of general hypermarkets is between 10-20 years. After 20 years of golden hypermarkets in the supermarket industry, the lease is gradually expiring.
During the visit, the reporter found that the traditional hypermarkets in Beijing are often opened in the position of an inch of land and an inch of money. For example, Beijing Centergate Technologies (Holding) Co.Ltd(000931) Wumart is only separated from Carrefour by a bridge, close to Beijing Centergate Technologies (Holding) Co.Ltd(000931) science and trade Beijing Electronic Zone High-Tech Group Co.Ltd(600658) , which can be described as a gathering place of people.
Mr. Xu, who is in charge of Beijing Centergate Technologies (Holding) Co.Ltd(000931) science and trade Beijing Electronic Zone High-Tech Group Co.Ltd(600658) leasing, told the reporter of times weekly that the rent of this lot is 6 yuan / square meter / day. If the rental area is large, the price can be negotiated.
In contrast, in the first 10 years of foreign hypermarkets entering China, they occupied the core area of big cities at a low price of 0.5 to 1 yuan / square meter / day.
“After the lease expires, you have to pay the cost to rent again. If the performance of the store is not good, it is difficult to support the high rent.” Tao Wensheng analysis.
According to the “2021 supermarket format survey express” released by China chain operation association, in 2021, the sales volume of 67.1% supermarket enterprises decreased year-on-year, the net profit of 72.2% enterprises decreased year-on-year, and the passenger flow of 68.39% enterprises decreased year-on-year.
According to the financial report data, Yonghui Superstores Co.Ltd(601933) 2021’s pre loss of attributable net profit reached 3.9 billion yuan, the first loss since listing; Wal Mart’s operating profit and gross profit in China fell in the fourth quarter of January 2022; The net profit loss of Renrenle Commercial Group Co.Ltd(002336) 2021, known as the “first share of private supermarket”, was about 857 million yuan.
“The deepening impact of the epidemic, the superposition of the new economic normal, coupled with the impact of e-commerce and community group buying, make it difficult for the development of physical retail.” Tao Wensheng saidP align = “center” online shopping business
Huang Yali, 22, said that since the outbreak, she has gone to the supermarket only a handful of times. “It’s too troublesome. It’s better to go home directly through online shopping. Moreover, the goods in the hypermarket are old and can’t stimulate the desire to buy.”
Not only the Post-00, post-80s, post-90s and even Post-70s began to turn to online shopping. Zhang Ying is a Post-70s consumer. She told the times that she was attracted online because there are often coupons on jd.com and meituan.com, which are more favorable than offline when they are full.
Once, hypermarkets attracted consumers with a large number of goods and preferential prices. According to Cui Lili, executive director of the E-commerce Research Institute of Shanghai University of Finance and economics, “compared with e-commerce, the price of hypermarkets may not have an advantage now.”
Cui Lili pointed out to the reporter of times weekly that in the original model, hypermarkets will charge suppliers for entry fees, shelf fees, display fees and other fees, which not only increase the cost of suppliers, but also increase the price of goods year-on-year. After the rise of e-commerce, brands have more choices. They can choose to enter channels that charge no or less entry fees, so that the commodity prices are more competitive.
In addition to e-commerce, community convenience stores and fresh food stores are also seizing the business of hypermarkets. According to the report of business observers in April last year, in a large and medium-sized community in Shanghai, there will be the integration of community fresh food professional stores such as aunt Qian, Qingmei, kangpinhui, Baiguoyuan and husband and wife meat shops, with an average area of about 30 square meters. Consumers can get rich choices without leaving the community to meet their daily needs. For example, consumers will buy pork in aunt Qian, go a few steps to Qingmei to buy bean products, go to kangpinhui to buy vegetables and groceries, then go to Baiguoyuan to buy fruit, and finally go to a mom and pop store to supplement other daily needs.
Ms. Qi, who lives in Fengtai, Beijing, told the times weekly that she had not been to a supermarket for a long time. Usually, the problem of buying vegetables is basically solved in the “vegetable basket” downstairs, and the fruit is more beautiful when buying fruit.
Cui Lili said that with the popularity of mobile Internet and the complete penetration of e-commerce, the sales model of hypermarkets can not meet the needs of consumers. In particular, some emerging consumer goods are often DTC’s, that is, they are sold directly through direct channels or accessed from convenience stores closer to consumer groups.
“Consumers are changing, and the market is also changing. Brands have changed from a single or less channel choice to a multi-channel and omni-channel layout, and they are less and less dependent on traditional stores. In this regard, e-commerce and 24-hour convenience stores that better adapt to the changes of consumers have brought great pressure to traditional hypermarkets.” Cui Lili saidP align = “center” online or offline
In the face of the impact, traditional hypermarkets are also trying to make changes.
The reporter learned from Wal mart that Wal Mart is based on the omni channel strategy, creates differentiated competitive advantages, introduces cutting-edge brands, and carries out new product launch, commodity co creation and other modes with mature brands. In addition, Wal Mart and JD launched the “new” plan of Jingwo. Since the strategic cooperation in 2016, they have continuously integrated their advantages in e-commerce, logistics and physical retail, and launched the “three links” strategy of interworking stores, users and inventory.
At the same time, Carrefour tries to develop in the direction of member stores while accessing online platforms such as Suning.Com Co.Ltd(002024) , Suning store and Carrefour applet. Last October, Carrefour China’s first member store opened in Shanghai. Tian Rui, CEO of Carrefour China, said that in the next three years, 100 of the 200 hypermarkets will be comprehensively upgraded into paid membership stores.
Chaoshifa, a local retail enterprise in Beijing, plans to focus on living supermarkets and fresh supermarkets, covering an area of 10002000 square meters. Most of the sites are located at the entrance and exit of the community. At the same time, it will vigorously develop community convenience stores and retain young customers.
Li Yanchuan, chairman of chaoshifa, said in an interview with spirit beast in January this year that there are many core competitiveness of physical stores. In the past, it was technology and fresh food. Now the broad category of fresh food has been extended to the scope of large fresh food, including cooked food, daily food and on-site hall food products. Now we still rely on these products to win customers.
Zhang Wenzhong, chairman of multipoint dmall, a retail solution service provider that has reached cooperation with more than 130 chain retailers such as Wumart group, Metro and Guangdong 7-Eleven to provide a full set of digital services, pointed out in an interview with the reporter of times weekly that at this stage, the digital transformation and Wuxi Online Offline Communication Information Technology Co.Ltd(300959) integration of physical retail enterprises are not enough, user operation, commodity development There is still much room for improvement in the management and optimization of shopping malls. It can be said that the digital reconstruction of retail enterprises has just begun.
Wang Peng, an associate professor at Renmin University of China, told the times that hypermarkets have the advantages of products, supply chain and capital chain, and their popularity is still high. In the future, we can make efforts from the following aspects: first, vigorously carry out digital transformation and Wuxi Online Offline Communication Information Technology Co.Ltd(300959) combination; Secondly, diversify the strategy and open more boutique supermarkets and convenience service stores; Shrink boutiques and open flagship stores; Finally, deeply cultivate the upstream of the industrial chain and make an upward layout.
Although physical retail is facing a severe situation, cuilili believes that offline shopping is still a very important shopping scene and will never be replaced by online shopping.
“The hypermarket carries my youth. I still hope the hypermarket can hold on.” Chen Lei said.
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