Is the trillion market -scale fruit retail a good business?

At the end of April, Hong Jiuguo updated the listing of listing in Hong Kong, and disclosed the company's full year of 2021 Financial data and business performance; early May, Bai Guo Garden handed over the Hong Kong Stock Exchange, planned the IPO listing for the third time in two years; in mid -May, CITIC Jianjun released the third phase of the listing of Xianfeng fruit listing counseling. Further. This summer, three fresh fruit retailers set off a new round of battle for \"the first stock of fruit retail\".

Data show that the size of the Chinese fruit retail market in 2021 was 1229 billion yuan, but this trillion -level huge market seems to be as good as it is as good as expected.

Offline retail \"Three Fighters\"

In the fruit retail industry, it is known as \"South Bai Guo, Beixianfeng, Xi Hongjiu\" These three offline fresh fruit retailers do not go smoothly. In an increasingly fierce environment of external competition, returning to its own profitability and business model may see the reason for its hindrance to the market.

Specifically, Belong is mainly franchise. From 2019 to 2021, the number of stores nationwide was 4,302, 4,748, and 5,249, of which only 5, 9, and 15 were respectively. Hong Jiu fruit products are core of durian, mangosteen, longan, dragon fruit, cherry, and grapes, forming a combination of fruit products from more than 100 origin places in the world and 49 fruit categories. Xianfeng fruits are mainly direct -operating and supplemented by franchise. The sales area is mainly concentrated in the East China region. The store layout is dense and strives to make achievements in one area.

In terms of revenue, the \"suction gold\" strength of Bai Guo Garden and Hong Jiuguo products is almost the same. From 2019 to 2021, Baiguoyuan realized operating income of 8.976 billion yuan, 8.854 billion yuan, and 10.289 billion yuan. The brand fruit of its exclusive distribution was quite red ballet strawberry, kiwi, Liangzhi Apple, etc. in 2021, which contributed 1 billion yuan Sales. The operating income of Hong Jiugo increased from 2.077 billion yuan in 2019 to 10.28 billion yuan in 2021, and the sales of the six core fruit products increased from 1.56 billion yuan to 5.91 billion yuan.

Unlike the franchise brand Baicuo Garden and the category brand Hong Jiu fruit, Xianfeng Fruit is mainly directly operating, with 5 fruits of Xianfeng Fruit, A K Orchard, Fruit Wharf, Fresh Fruit Wharf, and Yang Guopu. Brand is a company that integrates new retail, smart cold chain logistics and supply chain B2B platforms. In 2019, Xianfeng Fruit revenue reached 5.6 billion yuan. It provided post -meal fruit for large catering companies and large units cafeterias and the to B business supplied to more than 30,000 community stores (couple shops) to contribute over 1 billion Yuan's sales.

Despite its performance in revenue, the net profit of the three fruit retail giants is generally low in the final profit performance. Taking Beluo Garden as an example, from 2019 to 2021, net profit realized net profit of 248 million yuan, 45.658 million yuan, and 226 million yuan, respectively; the level of net interest rates was only 2.8%, 0.5%, and 2.2%, respectively.

Feng Dexin, the founder of Xianfeng Fruit, said that the traditional fresh fruit distribution industry has two general disadvantages of \"consuming\" and \"non -standard\". \"Easy -consuming\" brings increase in cost, which directly leads to unsatisfactory prices when fresh fruit is transported to offline retail stores; \"non -standard\" makes the fruit lack of quality and refined classification management, and it is difficult to achieve excess premium on the terminal. The profit is very small.

It is worth noting that in 2021, the loss rate of Hong Jiuguo products was 1.3%, between the average loss rate of the 1%-5%industry, and the net profit reached 292 million yuan. Among them, 53.3%of the revenue came from terminal wholesalers, 20.7%came from emerging retailers such as fresh e -commerce and community group purchase. Commercial super customers significantly decreased by 14.2%, and direct sales accounted for 11.8%.

According to the analysis of industry insiders, behind the lower loss, it shows that Hong Jiuguo has made great efforts in the supply chain structure and digital empowerment to achieve synergistic effects and improve operating efficiency. At the same time, Hong Jiu Guoqin's super customers have decreased significantly, and the revenue and proportion of emerging retailers have improved to a certain extent. Emerging retailers may be a channel for Hong Jiu Guo to create new opportunities.

Emerging retailers have entered the market strongly

E -commerce and modern retail and fruit franchise chain retail are gradually replacing the traditional farmers' market. Data show that in terms of fruit retail sales, the proportion of farmers' markets has decreased from 41.8%in 2016 to 25.0%in 2021, and it is expected to decrease to 17.0%in 2026. The diversified sales channels enter the market, meeting consumers' needs for consumer convenience and shopping environment.

How big is the fruit retail market? According to the data of the consulting company Fistana, according to the statistics of retail sales, the market size of the Chinese fruit retail market increased from 823.7 billion yuan in 2016 to 1229 billion yuan in 2021, with a compound annual growth rate of 8.2%. It is expected to be expected to be expected in 2026. It will further increase to 1775.2 billion yuan, and the expected compound annual growth rate from 2021-2026 will be 7.6%. On the other hand, the three powerful competitors of \"Fruit Retail\" are about 10 billion yuan, and it is difficult to support this trillion -level market. In recent years, emerging retailers such as fresh e -commerce and community group purchase have aimed at the fresh fruit business and entered the market strongly, squeezing and competing around the fruit industry resources.

The three giants of Pinduoduo, Alibaba, and Meituan mainly deployed community e -commerce, focusing on shop warehouses and community group purchases; Youzan SaaS system \"Youzan Retail\" for the main store operation management can help fresh freshness Fruit and vegetable physical stores realize online and offline integrationManagement; Mixue Bingcheng established Xuewang Agricultural Corporation, the business scope contains fresh fruit wholesale; retailers such as Yonghui Supermarket also began to adopt the front warehouse model for local distribution ... The characteristics of highly scattered industry, as well as competing supply chains, operations, services, etc. The contest of comprehensive capabilities provides an opportunity for emerging retailers to rise rapidly. Not only did they invest higher in the early stage, more commodity categories, higher consumption frequency, and more comprehensive services. Delivery prices and price delivery are lower than that of offline fresh fruit retail brands such as Bai Guo Garden.

The advantage of fresh e -commerce is that it can rely on scientific and technological means to grasp the customer's purchase habits and provide consumers with a more convenient shopping experience and more options. Therefore, market share in fruit retail channels continues to increase. Community group purchase can cover a 1-3 kilometer community, which is convenient and fast, so there is a higher repurchase rate, and it is closer to consumers. It also increases the understanding of consumers' purchase habits. The relatively few SKUs are furnished to reduce the loss of fruit.

But from the performance of the \"first share of community group purchase\", it is not satisfactory. From 2019 to 2021, the daily fresh revenue was 6.01 billion yuan, 6.13 billion yuan, and 2.122 billion yuan, respectively, and net profit was -3.474 billion yuan, -2.64 billion yuan, and -974 million yuan, respectively. Following the listing of Ding Dong, which was listed, the revenue increased rapidly, with 3.880 billion yuan, 11.336 billion yuan, and 20121 billion yuan, but the net profit was -1.994 billion yuan, -3.497 billion yuan, -67.17 billion yuan, respectively. Yuan.

Fruit selling fruits is becoming more and more \"volume\", and emerging retailers are also difficult to enter the bureau. JD CFO Xu Ran once talked about Jingdong Supermarket and fresh retail business that the entry threshold for fresh e -commerce companies is relatively high, the market is huge, and many companies can accommodate, but there may be only a few of them in the end. \"The loss rate of production and circulation is high, and the competitive advantage cannot be obtained by providing subsidies. The key is to find a way to reduce operating costs.\"

In addition, the epidemic accelerates the acceptance of the acceptance and use of fruit online consumption. The frequency also accidentally promoted many retailers who had only carried out offline operations to start establishing online channels. In the consumption of fruits, offline test eating, touch, and service experience are also crucial. Therefore, even after the epidemic, the fruit industry is expected to continue based on the new business model of online store expanding online retail opportunities. In the prospectus, Baiguoyuan stated that its next stage of business strategies include continuous expansion of channel networks and channel brands, and continuously expand and optimize online and offline integrated operation models.

Branding consciousness is awakening

With the increase of per capita consumption expenditure and the upgrading of diet consumption, consumers' demand for high -quality fruits is increasing Makes people pay more attention to food safety and source. Industry insiders said that in the future, consumers are willing to be high -quality, delicious and safeFruit pays a high premium and will choose retailers with more high -quality fruits.

As far as fresh fruit retailers on the head, industry insiders pointed out that they should continue to cultivate the fruit supply chain, implement standardization of various links, create channel brands and fruit products brands, and allow customers to experience high -quality services and services Consumption to high -quality products. Whether it is to develop to B business or strengthen digitalization, \"selling fruits\" is no longer a business that can win by chain, but is an integrated business that connects the industry upstream and downstream, deep cultivation technology and supply chain capabilities. And fresh retailers such as fresh e -commerce and community group purchase rely on the influence of channel brands can meet the characteristics of fruit sales, and also in line with the needs of consumers' pursuit of convenience, fast, and humanized customer service, and have great development potential.

Industry insiders also reminded that the Chinese fruit industry is currently in the period of industry transformation and upgrading, and fruit products are transforming to standardization. With the awakening of brand awareness, retailers have begun to build their own brands, but retailers with rarely deploy channel brands and product category brands at the same time.

Whether it is traditional fresh fruit retailers or emerging retailers, they rely on purchasing diverse fruit and high -quality quality control to improve the added value of the final products, create category brands through differentiated products, establish themselves to establish themselves Brand image. Industry insiders pointed out that a powerful brand will change customers to evaluate the traditional concept of fruit only based on the place of origin and freshness, thereby increasing the stickiness of customers, and to maintain a long -term relationship with the loyal customers to achieve a brand premium.

There will be more imported fruits and more diverse fruit types in the future fruit retail market. With the favorable support of the “Belt and Road” initiative, with the development of long -distance transportation, retailers will be easier to import fruits from the world to meet consumers' needs for imported fruits. In any case, what consumers want are only \"eating fresh fruits.\"

Source: China Food News

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