Do you remember?There used to be a supermarket, its name was Yonghui, and its slogan was "Forever Bright". Its stores are all over the country, its goods are dazzling, its service is considerate and thoughtful, and its best is affordable and reasonable. It is a shining star in China's retail industry, and its share price has soared, and its market capitalization once exceeded $10 billion. It is the first choice of countless consumers, it is the darling of countless investors, and it is a nightmare for countless competitors.
However, all this is a thing of the past. Today's Yonghui supermarket is facing many difficulties. Its performance continues to be sluggish, the number of its stores is also shrinking, its debt is as high as 47.2 billion yuan, and its market value has shrunk by nearly ninety. It had to ** its own assets in exchange for a glimmer of life.
It had to try new formats in order to seek a breakthrough in transformation. It had to work with e-commerce platforms to resist industry change. What the hell happened to Yonghui Supermarket?Why did it go from glory to decline?
The rise of e-commerce has brought a huge impact to the traditional supermarket industry. With the popularization and development of the Internet, more and more consumers choose to shop online and enjoy convenient, fast and preferential services.
The e-commerce platform not only provides a rich variety of goods, but also provides flexible delivery methods, and even launches new formats, such as community**, live streaming, unmanned supermarkets, etc., which attract a large number of users. The advantages of e-commerce platforms make it difficult for traditional supermarkets to compete with them in terms of **, category, service, etc., resulting in a decline in customer flow, a decrease in sales, and a compression of profit margins.
The ever-changing needs of consumers have also brought challenges to the traditional supermarket industry. With the progress of society and the improvement of people's living standards, consumers' consumption concepts and consumption habits are also changing. Consumers are no longer satisfied with simply buying goods, but pay more attention to the quality, safety, health, environmental protection and other aspects of goods.
Consumers are no longer satisfied with a single way of shopping, but more pursue shopping experience, emotion, social and other aspects. The upgrading of consumers' consumption has made it difficult for traditional supermarkets to meet the needs of consumers in terms of goods, services, and environment, resulting in the loss of customers, the decline of brands, and the shrinking of the market.
As a representative of the traditional supermarket industry, Yonghui Supermarket is also difficult to escape the influence of these two factors. In recent years, Yonghui Supermarket's performance has been on a downward trend. According to Yonghui Supermarket's financial report, in 2021, Yonghui Supermarket's operating income was 1,036800 million yuan, a year-on-year decrease of 54%；Net profit was -1700 million yuan, a year-on-year decrease of 1046%。In the first three quarters of 2022, Yonghui Supermarket's operating income was 722900 million yuan, a year-on-year decrease of 73%；Net profit was -3200 million yuan, a year-on-year decrease of 1147%。
In 2023, Yonghui Supermarket's total liabilities reached RMB47.2 billion, of which RMB15.5 billion were short-term borrowings, RMB6.7 billion were non-current liabilities due within one year, RMB15 billion were long-term borrowings, and RMB10 billion were bonds payable. Yonghui Supermarket's debt-to-asset ratio is as high as 826%, much higher than the industry average.
The number of Yonghui supermarkets is also shrinking. According to Yonghui Supermarket's announcement, in 2021, Yonghui Supermarket opened a total of 111 new stores, but also closed 113 old stores, a net decrease of 2 stores.
In 2022, Yonghui Supermarket opened a total of 76 new stores, but also closed 103 old stores, a net decrease of 27 stores. As of September 30, 2023, the total number of Yonghui supermarkets was 1,612, a decrease of 29 from 1,641 at the end of 2020. The size of Yonghui Supermarket's stores is also shrinking.
According to Yonghui Supermarket's financial report, in 2021, the average single store area of Yonghui Supermarket was 3,800 square meters, a decrease of 2 from 3,900 square meters in 20206%。In 2022, the average single-store area of Yonghui supermarkets was 3,700 square meters, a decrease of 27%。In the first three quarters of 2023, the average single-store area of Yonghui supermarkets was 3,600 square meters, a decrease of 27%。
The market value of Yonghui supermarkets has also shrunk significantly. According to the stock price trend of Yonghui Supermarket, in 2020, the share price of Yonghui Supermarket reached a maximum of 185 yuan, and the market value reached 117 billion yuan. In 2021, Yonghui Supermarket's share price peaked at 145 yuan, with a market value of 92 billion yuan.
In 2022, Yonghui Supermarket's share price will be as high as 105 yuan, with a market value of 67 billion yuan. In 2023, Yonghui Supermarket's share price will be the highest at 65 yuan, with a market value of 41 billion yuan. As of December 24, 2023, Yonghui Supermarket's share price is 52 yuan, with a market value of 33 billion yuan, 719%。
Yonghui Supermarket, once a shining star in China's retail industry, is now in crisis. Faced with the impact of e-commerce and the upgrading of consumers, Yonghui Supermarket had to sell itself to survive and seek self-help. Yonghui Supermarket has raised funds through first-class assets and sought transformation through innovative business formats, showing its indomitable spirit and its courage to dare to change.
However, Yonghui Supermarket's road to self-help is not smooth, and it still needs to face many difficulties and challenges, such as financial pressure, fierce competition, and consumer changes. Whether Yonghui Supermarket can get out of the predicament and regain its glory remains to be tested by time. Yonghui Supermarket sold assets to survive the winter