Recently, the discount supermarket chain of Biyide, which focuses on low prices, suddenly announced the closure of business, which has attracted widespread attention. According to the announcement issued by Biyide, the supermarket will be temporarily closed from December 22, 2023. According to public information, Biyide is a discount store brand founded by German Philipp Spangenberg in China, and has developed rapidly, opening more than 200 stores in Shanghai and Jiangsu. The strategy of focusing on cheapness and convenience has earned it a lot of loyal customers in the community. But why did this once-glamorous supermarket chain suddenly close down?
First of all, the business model of Biyide is one of the important reasons for its closure. According to people familiar with the matter, Biyide adopts a heavy asset direct store model, although the quality is guaranteed, but the input cost is high, and most of the stores are along the street, and the rent is expensive. This is undoubtedly a high-cost model for low-margin, high-cost retailers. In addition, there are too few product categories and insufficient number of SKUs in a single store, which limits customers' choices and may affect customers' shopping experience and loyalty.
Secondly, the fierce competition in the market is also an important factor that led to the closure of Biyide. With the expansion of low-price competitors such as Hema Outlets, Biyide's market share has gradually been squeezed. Especially in the context of the economic recession and the decline in consumer purchasing power, the competition for low prices is becoming more and more fierce, which makes it more and more difficult for Biyide to operate.
However, despite the challenges, the closure of the company also sheds light on some of the current economic implications of the retail sector. On the one hand, it highlights the dilemmas and opportunities of low-cost retail models. In an environment of rising costs and intensified competition, how to balance quality and cost, innovation and stability has become a challenge that retailers must face. On the other hand, it also reminds retailers to pay attention to market changes and consumer needs, and constantly adjust and optimize business strategies to adapt to the changing market environment.
Overall, the closure is a wake-up call for retailers to keep innovating, optimizing their business models, and paying attention to market changes and consumer needs. Only in this way can we be invincible in the fierce market competition. At the same time, it also provides valuable experience and lessons for other retailers to jointly promote the healthy and sustainable development of the retail industry.