What is the future of traditional stores? Recently, the adjustment of RT-Mart, Hema and other stores has sparked heated discussions. In this regard, RT-Mart admitted that the past few years have been a "painful transition period" for hypermarkets, and the closure of stores is an adjustment of business strategy; Hema bluntly said that the replacement of the tail department store is carried out normally. It is true that the addition of membership-based product lines, the establishment of a tail store replacement system, the subdivision of store types, and the introduction of offline low prices are all effective means for hypermarkets to "save themselves", but in the process of transformation and upgrading, building core competitiveness and improving profitability are the keys to success.
The store "tail" upgrade.
The change in consumer demand is urging the transformation and upgrading of the hypermarket industry. Recently, a reporter from Beijing Business Daily learned that RT-Mart, a supermarket brand under Sun Art Retail, has entered a "painful transition period". According to incomplete statistics, since January 2023, at least 13 RT-Mart stores have closed or announced their closures, involving Hunan, Jiangsu, Hubei, Sichuan and other provinces, mainly due to lease expiration and business adjustments.
In this regard, RT-Mart told the Beijing Business Daily reporter that the closure of RT-Mart stores is a normal business strategy adjustment in various regions of the brand, and the closure and opening of stores are normal business actions, and some stores may be transformed and upgraded into M membership stores. According to reports, in 2024, Sun Art's three retail formats, namely RT-Mart, RT-Mart Super, and M member stores, will open a total of 21 new stores nationwide. At the same time, the brand will also renovate RT-Mart stores that are more than 10 years old to complete 2Version 0 refactoring, department stores will be directly upgraded to M member stores.
In fact, hypermarkets and "Internet supermarkets", which are highly sought after by consumers, are actively seeking ways to transform, constantly adjusting stores that no longer conform to the laws of the market. In the first half of this year, Hema Xiansheng closed 6-7 stores nationwide, in this regard, the relevant person in charge of Hema replied to the Beijing Business Daily reporter that the closed stores are the normal tail store replacement of the brand, and will look for better properties nearby to undertake consumer demand. At the same time, Hema plans to open 70 new stores this year, and the number of Hema stores is expected to exceed 400 in 2024.
It is undeniable that retail companies are walking on two legs, and closing the tail store is on the one hand to reduce unnecessary expenses, and on the other hand, it is also paving the way for brand upgrades.
Segment store types.
At this stage, retail companies are facing more market challenges. For traditional stores with large areas and full SKUs, on the one hand, consumers' demand for "one-stop shopping" of daily necessities is gradually declining, and random consumption is gradually popular; On the other hand, hypermarkets with a large area and centralized display of goods will undoubtedly have to pay high rents and corresponding equipment management and labor costs.
Wang Peng, an associate researcher at the Beijing Academy of Social Sciences, said that the main consumer groups are more keen to buy personalized, healthy and high-quality products, and the original brand positioning of the store is not fully compatible.
However, brands that are not willing to be eliminated by the times are also actively seeking ways to "break the circle". The new store type is one of the attempts of retail enterprises to explore. Taking Sun Art Retail as an example, for different types of consumer groups, Sun Art Retail's three business formats have different positioning and target customer groups. A reporter from Beijing Business Daily learned that compared with RT-Mart, RT-Mart Super has a larger store area, and it also emphasizes the experience of offline stores and the people's popularity; M member stores pursue high-end, and most of them are self-operated brands.
In addition, more favorable ** and higher cost performance have also become important measures for transformation. Following the launch of the "offline exclusive price" in the first store last year, Hema launched a pilot in Beijing, Nanjing and Changsha in February this year, launched online and offline synchronous low prices, and raised the free shipping threshold for online orders in the three places to 99 yuan. The way of reducing prices and increasing shipping costs will undoubtedly increase the unit price of online orders to a certain extent, and attract consumers to offline consumption with more preferential prices.
Yonghui Supermarket has also added "** discount stores" in stores nationwide since October last year, and has added discount areas on the APP and mini program at the same time to provide discounted food and supplies. The person in charge of Yonghui Supermarket once said that discount stores are a major trend in the retail industry in the current market environment, which can not only speed up the replacement efficiency of Yonghui products, break the difference between high and low prices in the marketing environment and the daily environment, but also further enrich the types of goods and bring more cost-effective choices to consumers.
Procurement and operation should form a synergy.
Whether it is the launch of a new type of store, or the first "down", the competition between retail enterprises in the final analysis lies in the "commodity power", which is also the fundamental factor to attract consumers. In the view of retail expert Hu Chuncai, most of the current store brands have failed to achieve real differentiated competition with e-commerce platforms, unable to effectively attract potential consumers with strong purchasing power, and most of them have followed the transformation of consumption hotspots, but have not formed their own characteristics. "If we can form a joint force of procurement, planning, and operation to create products in the hearts of consumers, we can successfully transform in the fierce market competition. ”
Wang Peng suggested that the store can be renovated according to the needs of the radiation customer group, increase convenient facilities, upgrade the old stores, and create a more comfortable and convenient shopping environment. He said, "In the process of transformation and upgrading, stores should maintain their core competitiveness, such as first-class advantages, rich variety, etc., these key factors to attract consumers still need to be maintained and improved in the transformation process."
The decline of hypermarkets does not mean that traditional retail is unpopular, but rather that hypermarkets are being forced to find distinctive paths. Lin Xiaohai, CEO of Sun Art Retail, has also publicly stated many times that "multi-format omni-channel" is the company's long-term development strategy, and the accelerated opening of RT-Mart Super and M member stores, which undertake the second growth curve, does not mean the contraction of RT-Mart, a hypermarket format.
Hypermarket leaders still believe that stores can carry more of the future and provide consumers with more choices. Previously, Wang Shoucheng, business assistant to the CEO of Yonghui Supermarket, said, "We hope to create a new template for the transformation and upgrading of traditional offline stores, and also hope to let more consumers re-experience the experience, atmosphere and fireworks brought by offline retail scenes."
Beijing Business Daily reporter Zhao Shuping, Wang Siqi, Hu Jingrong text and photo.