Baiguoyuan has now entered more than 80 cities and opened more than 4,000 stores. At present, it is an integrated development of online and offline, and e-commerce accounts for about 25% of the whole. What I want to share today is to think about how we should make fresh food based on the development of Baiguoyuan for so many years.

You may see that Baiguoyuan is more of a terminal retail store and a retail network. However, since 2003, hundreds of orchards have been laid out in the direction of the upstream and the whole base. The whole industrial chain layout of Baiguoyuan started with the guidance of standardized planting techniques. We have introduced planting techniques from Japan and Europe, including supporting the research and development of fertilizers and seeds. We believe that really good fruits are not selected, but must be planted.

At that time, we not only introduced fruit planting technology, but also introduced other supporting technologies of fruit industry and vegetable industry together, but in the early stage, it was more applied to fruits, which had certain development space in vegetables and other aspects. Then to the financial system, trading system, warehouse allocation, logistics, marketing, sales and the whole data, Baiguoyuan is now building an ecology of the whole industry chain. Baiguoyuan now has a research and development team of 500 to 600 people, which supports the research and development of the whole system. This may not be enough for a standard Internet company, but for a retail company, we hope to gradually break the line between online and offline. Because the future competition is no longer just the competition between retail enterprises. Recently, Internet giants have also entered the field of fresh food. People who used to do offline fresh retail will work together in this industry, and they may have to compete and integrate with these Internet companies in the future.

Why do Internet giants favor fresh food?

First of all, freshness is an entrance that high frequency just needs, and it is definitely an opportunity at the entrance level. In the internet, high frequency often plays the role of low frequency, so fresh food must be the category with the highest frequency. However, in the past, due to various reasons such as supply chain, the development of fresh e-commerce has not found a good model. Whether it's the previous B2C or the later O2O, the continuous development of these models includes pre-warehouse, community group purchase and so on. In fact, the Internet is constantly exploring how to make fresh food. Fresh food, a high-frequency just-needed entrance, may bring some great changes to the whole retail pattern once it finds a pattern that can erupt. So people will think that this entrance can't be lost.

Second, the black swan epidemic has accelerated the seepage velocity of fresh e-commerce. Judging from the data of permeability, the evolution process of the whole industry has been accelerated. Because of this acceleration, some changes that might take three to five years in the past have happened more quickly this year.

Third, these internet platforms and retail platforms seem to have found a thinking mode of light asset flow. Internet is traffic thinking, and retail must be retail thinking, which is a completely different way of thinking. Recently developed community group buying and so on (not necessarily that this future is fully established) are all relatively light asset models. Light assets are used to open stores under the marking. For example, in a city like Shanghai, we want to open 700 stores one by one, but this model of community group buying, opening a warehouse and completing a layout of heavy assets, the rest is more online development, so it is lighter. This relatively light asset model is very suitable for the Internet, so why are the giants going here now? I don't think this is necessarily a bad thing. Let a hundred flowers blossom and let's explore together, which shows that the fresh consumption of the whole community is still very active, which also brings better vitality to the market.

Three characteristics of community freshness

From a macro point of view, we believe that the whole community fresh, or fresh industry, has three characteristics, that is, wide enough, deep enough and long enough. This may be different from what we used to do as industrial products and standard products.

Wide enough: In other words, China is too big and needs to be gridded. Fresh food must be done offline, or in the form of O2O, not in the traditional Internet way. Because the freshness must not be covered with nets, it must be filled with grids, not even in cities, but in communities. Perhaps one community has absolute market share and advantages, but the pattern of the next community is different, so this is a process of gradual grid competition and grid filling. His dimensions and particles are very small.

Deep enough, from the first-tier cities to the fifth-tier rural areas, the depth is very large. As we all know, like prosperity optimization, many community group purchases have reached the village level. And every level of cities, every level of consumers, his needs and preferences may be different.

The third is long enough. Fresh food is planted from the place of origin to the hands of consumers. For standard industrial products, its whole chain is very long. We often talk about a process called "from branches to tongues". In fact, no matter any fresh enterprise, it is actually from the branches to the tongue, and there is no difference. In fact, there is no difference between his whole logistics link and his performance link. Even if it is sent directly from the place of origin to the hands of consumers, it must go through every link, and the whole logistics process cannot be saved. He sends a courier from the place of origin, the courier arrives at the regional warehouse, then goes to its distribution center, then to the city station, then to the service station, and then to the consumers. In the logistics link, it is aimed at other retail enterprises that are not directly delivered from the place of origin. In fact, it doesn't save any links. So no matter what mode is used, this chain is long enough.

The scope is wide enough, and it is a model war in different regions and even in different communities. Deep enough, China people's consumption culture is diverse and obviously stratified, which needs to be constantly adapted and adjusted according to the regional characteristics. Long enough, fresh and professional. Baiguoyuan has spent 20 years making this category of fruit relatively professional. Besides, a fruit is so difficult and there are so many fresh categories. We must take time to cultivate each category, if we really want to do it well and professionally.

The above three characteristics, so we believe that community fresh-keeping is definitely a long-term business, not a quick fix, but a protracted war, not an industry that can quickly form a monopoly entrance in the short term.

The competition of non-standard products is in the first kilometer.

Community consumption is divided into standard products and non-standard products. Our conclusion is that the competition of standard products is in the last mile, and the competition of standard products needs higher channels. In the last mile, you can better penetrate into every terminal, making it easier for consumers to see you and buy you. But the real battle for non-standard products is upstream, in the first kilometer.

Standard consumption experiences price, while non-standard customers experience more value than pure price.

Standard products test capital ability and scale ability, and non-standard products must test professional genes.

So to sum up, the ultimate focus of this community fresh-keeping war must be a high degree of professional differentiation, and whether the fresh-keeping category can really make a difference to others. Simply burning money on standard products is worthless. This kind of burning money on fresh food and consumption in the community can only make users sensitive enough to price, but it is difficult to cultivate loyalty to channels and understanding of value. In the end, it may become whoever is cheaper will buy it. Freshness ultimately depends on freshness, quality and differentiation. It is not that the standard products cannot be distinguished. In fact, standard products can be differentiated from the choice of products to the development of their own brands. In the future, we believe that the competition of community fresh consumption must be a breakthrough in the differentiation of fresh and standard products, and it is possible to truly gain the loyalty of consumers.

Customer pain points of fresh consumption

The first one, high quality and low price, we think is the eternal demand of consumers. No matter which consumer class, low-end consumer group or high-end consumer group, what everyone pursues is the cost performance with good quality and low price, which is unchanged.

If fresh consumption is fast and economical, we thought it was a false proposition at first. When customers buy a fresh product, they don't need to search for a keyword like Taobao and choose tens of thousands of records. What customers need is that what I buy through this channel is reassuring and of good quality. So fast, we feel that there is a consumption scene, and customers are pursuing a service experience, but it is not the core demand of community fresh consumption. Finally, a harmonious province must be inexpensive, which is the eternal fundamental demand of consumers.

The second pain point is whether it is a truly reliable consumption channel. The core of fresh products is that the stability of quality cannot be guaranteed. Instead of buying well today, not tomorrow, maybe the day after tomorrow, consumers' trust cannot be established.

Therefore, we believe that we still have a lot of room for exploration in terms of good, cheap and truly reliable channels.

Advantages and models of quality and freshness of Baijia orchard

What are the possible advantages of Baiguoyuan? It may not be unique, but there are some things we have accumulated, such as upstream planting, supply chain system, our store network, membership, including the standards of our entire fresh products. These are all things that Baiguoyuan has been deeply involved in the fruit industry for 20 years, and we hope to copy them to fresh products to some extent. Of course, the most important thing is that our 60 million members and 5 million community users trust the brand and quality of Baiguoyuan and pursue quality and cost performance. This is our core.

At present, we have roughly divided these three modes, and everyone has their own logic, and there is no right or wrong. The first category is the integration of stores and warehouses, such as box horses, like hundred orchards and so on. No matter whether it is a small shop or a big shop in the community. Second, the mode of pre-warehouse, such as JD.COM and Meituan, provides timely delivery service. Then the third kind is to arrive the next day, like a typical model similar to community group buying. The service points pursued by these three models are still different.

As far as Qiancang is concerned, his core advantage lies in the service, which can be obtained in 30 minutes, which is a very good service for users with such needs. Shops and warehouses are integrated. Everyone goes to visit the shop of Box Horse and Baiguoyuan. In the process of shopping and choosing goods, including online and continuous service ability, his experience is better. Offline display and layout, like the idyllic feeling of a hundred orchards, give you a different feeling. Then the next day, it was more about efficiency. Under the next-day mode, its supply chain is basically a sales and pre-sale mode, so its logistics and many aspects have room for optimization.

We also chose next-day delivery for Baiguoyuan, that is, online booking and delivery the next day. The reason for choosing this mode is more based on its own characteristics. Our own nearly 5000 stores are integrated with our warehousing and distribution logistics system. Relatively speaking, we choose this mode as the lowest cost way. Only by choosing the way with the lowest cost can I provide customers with truly inexpensive products and services.

At the same time, it is also very important that Baiguoyuan used to be a fruit shop, but today the value of the shop is completely different.

It turns out that the core function of a store is to cover users in the surrounding communities around 1 km. According to our research, Baiguoyuan is located in the core urban area, and its average penetration rate to surrounding communities is about 15% to 20%. In the past two or three years, based on the stores in Baiguoyuan, we launched the online fruit delivery service in time, expanding the entire service boundary from the original 1 km and 1.5 km to 3 km or even more. Through such services, we have improved the overall penetration rate in the surrounding areas. Now it is fresh, and I hope to develop the next-day service of all kinds of fresh food around the store for 2 kilometers through the whole fresh category. This is the transformation of the function of offline stores now.

Therefore, our own definition of Baiguoyuan is called the model of "making specialty offline and broadening online".

The fruit category is the most efficient category with high professionalism, so I chose fruit as the offline core category. At the same time, I launched all categories except fruit. My store is my self-promotion point and my logistics performance center. Through such a model, I will build a whole model to make 100 orchards have fresh quality.

For physical stores, such as a store in Baiguoyuan, the area is very limited and the requirements for floor efficiency are very high. The display of every shelf and the choice of every commodity require high floor efficiency and product efficiency. Based on such a requirement, we should choose which category is suitable for offline and which category is suitable for online. Through such online and offline integration, we will build our entire fresh food business.

Quality: four noes, three highs and one high.

We put forward a concept of commodity development, including the development of fresh, standard and private brand commodities, "four noes, three highs and one persistence".

Four noes: don't do it until you get to the source, don't be an expert, don't be an expert, and don't touch yourself. Since we are positioned as a consumer group with 60 million members of Baiguoyuan as the core, we must ensure and pursue quality.

Three highs: high quality, high nutrition and high safety.

Persistence means insisting on high cost performance. This is definitely not the high cost performance obtained by subsidies. In the long run, it must be that the operating efficiency is high enough and the cost is low enough to bring higher cost performance to customers. Therefore, our concept and mission of fresh food is called "leading a healthy and sustainable lifestyle". We hope to open up the whole upstream chain through high-quality goods and truly lead such a lifestyle.

We will stick to quality as the core. We believe that the decisive victory of community freshness in the future is not on the flow side, but on the supply chain side. We hope that through brands and channels like Baiguoyuan, we can sell good goods and let consumers buy high-quality goods better. I hope this can be achieved through our efforts!

China Food Safety Network News Clue Email: wwwcfsncn @163.com.

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