poppyplaytimechapter2crashing| Behind Pang Donglai's "help" supermarket: exporting its own brand, being a supermarket and a supplier

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In the past two months, Pangdonglai seems to have become a "lifesaver" of the Shang Chao industry, with the object of "helping" from step by step to Yonghui. On May 23, it was reported that Fengdonglai would adjust the "help" of Guizhou Heli supermarket, which once again became the focus of attention.

Red Star Capital Bureau has noticed that "helping" by Fang Donglai is more of a commercial act than it is believed to be unilateral "help" and "support" from Fang Dong.

Behind the "help", Pangdonglai has become a "fixed collocation" to export its own brand goods to the "helped" supermarket. On May 20, the relevant person in charge of BBK told the Red Star Capital Bureau that the sales of goods under its own brand "DL" from Fangdonglai accounted for almost 1/3 of the sales of BBG (Jin Kirin analyst).

"through the way of 'help', Fengdonglai has turned its own brand into an independent brand and completed the expansion of multiple channels." Zhuang Shuai, founder of Bailian Consulting, said to Hongxing Capital Bureau. Li Weihua, an expert in chain operation, told Hongxing Capital Bureau that the cost and price of own-brand goods are relatively opaque, and the profits of this business are usually high for merchants. On the other hand, Fatong comes from the export of branded goods to more supermarkets, and sales have also increased.

After Pang Dong came to "help"

The sales volume of "DL" accounts for 1/3 of the total sales of step by step.

After being "helped" by Fangdong for a month, Bubugao supermarket disclosed its report card for the first time. On May 15, Bubugao posted that since May, the average daily sales of Meixi Lake store has reached 1.51 million yuan, with an average daily passenger flow of 1.Poppyplaytimechapter2crashing260000 people. Before the adjustment, the average daily sales of the store was 150000 yuan, with an average daily passenger flow of 2000 people.

Daily sales have increased tenfold, and the average daily passenger flow has increased by more than six times that of the past. Bubugao attributed this to the adjustment of Fang Donglai, which bluntly said in the article, "the effect of the adjustment is amazing."

What attracts consumers to flock to the store is not only the step by step after the change, but also all kinds of self-branded goods from Pudong.

According to the Xiaoxiang Morning Post, Fatty Donglai "explodes" step by step, while exporting a number of online celebrity-owned goods, consumers quickly "short" them. The online celebrity "Big Moon Cake" of Pangdonglai, which was first put on the shelves on April 11, was sold out. DL craft wheat beer went on sale on April 12, and the first hundreds of cases were sold out in less than an hour. Sales were so hot that BBG had to notify that night that three products from the brand "DL" had to be suspended.

Red Star Capital Bureau noted that in the early days of "help", step by step revealed that it would introduce "20 popular products recommended by Pudong." These include DL craft wheat beer, DL orange juice, DL enzyme detergent, DL fast-ripening oatmeal and so on. Commodity categories include baked goods, beverages, cleaning products, grain and oil, daily chemical products, the price is basically less than 100 yuan.

The picture is from Lianshang.com.

These fat things come from branded goods that bring a lot of traffic to Bubugao. So far, search social platforms for keywords such as "DL", which comes from a brand that frequently appears on consumers' shopping lists, and even a purchasing agency service that "Changsha helps buy goods from Fatty Donglai".

Not only the flow, Pangdong from branded goods also boost supermarket sales. On May 20, the relevant person in charge of Bubugao told the Red Star Capital Bureau that as of the 19th, only Meixi Lake store, Pangdong came from the cumulative sales of branded goods in May 803.Poppyplaytimechapter2crashing32 million yuan, with an average daily sales of 422800 yuan. In terms of average daily sales, Pangdong's sales of branded goods account for almost 1/3 of Bubugao supermarket's sales.

Fat Donglai has deep cooperation with suppliers.

Independent brands expand their channels through "help"

Before the step by step, the Gabriel supermarket in Shangrao, Jiangxi Province also received "help" from Fang Donglai. It is worth mentioning that the introduction of Pangdong from branded goods is also an important part of receiving "help".

According to the article "Fangdonglai 'help' adjust the record of the Cadbury supermarket" released by Lianshang.com, it mentioned that "Donglai has removed 7000 items from the shelves and reintroduced high-quality brand goods in accordance with the commodity standards of Fangdonglai." at the same time, the introduction of Pangdong to bake, fruit juice and other popular style goods, a plate of goods take on a new look. "

Red Star Capital Bureau also found that the Chengdu neighborhood supermarket, which followed Pangdong to carry out the transformation, also appeared that Pangdong came from products such as branded laundry detergent, cooking oil, oats and beer. The manager of a store in the supermarket told Red Star Capital Bureau that the prices of these "DL" goods were the same as those of Pangdonglai stores and were purchased from Pangdonglai.

The Red Star Capital Bureau interviewed and learned that Pangdonglai's own-brand goods are not produced by themselves, but have their own suppliers, such as DL baking soda detergent detergent, DL yogurt fruit oat crispy, DL craft wheat beer, and so on.

On May 16, the Red Star Capital Bureau called one of the product suppliers, who said that the specifications and proportions of the products supplied to Fengdonglai were customized. In other words, the above-mentioned "DL" products are not simple branded products, but are produced by Pudong docking with suppliers and have their own formula.

Some voices in the industry believe that this is a way of expansion of Fang Donglai. Zhuang Shuai, founder of Bailian Consulting, told Hongxing Capital Bureau on May 20 that this innovative model is equivalent to Fang Donglai's "help" to turn its own brand into an independent brand and complete multi-channel expansion.

Li Weihua, an expert in chain operation, said in an interview with Hongxing Capital Bureau on May 21 that this is a good way to expand. Some people say that Pudong can't get out of Henan, but its products have gone out of Henan.

As for the behavior of other supermarkets to buy goods directly from Fengdong, Zhuang Shuai mentioned that Fangdonglai's idea is to be a brand, not just a retailer, to earn money from the supply side and brand premium. "Pangdong can be understood as a brand like missing you and Chia Guazi."

Pangdong, who can not get out of Henan, may be using this "help" way to spread his own brand goods to other channels.

Experts:

Private brands have higher profits, and the retail industry is scrambling to expand.

Yu Donglai, founder of Pang Donglai, once publicly stated that he originally planned to earn 20 million yuan last year (2023), but did not expect to earn 140 million yuan by the end of the year. If the data disclosed by Yu Donglai is true, Pang Donglai's net profit has exceeded that of many well-known listed companies in the retail industry. This ability to make money is not unrelated to Pang Donglai's private brand products.

In March this year, Red Star Capital Bureau went to Xuchang City, Henan Province and visited many stores in Pangdonglai. After comparison, it is found that among multiple categories of goods and services, Pang Donglai has almost no price advantage in Xuchang.

According to interface news reports, the higher gross profit margin of popular items keeps Pangdonglai's overall gross profit margin in the range of 4%-5%. The retail industry usually has a gross profit margin below 3%, and even loses money. Yu Donglai said that at least a few of the privately owned brand items developed in the future will have sales of 500 million yuan to 1 billion yuan.

Li Weihua told Red Star Capital Bureau that the cost and price of private-brand goods are relatively opaque, and for merchants, this business is usually more profitable. In addition, Pang Donglai's private-brand products are exported to more supermarkets, product sales have increased, companies have increased bargaining space with suppliers, and costs can be further reduced.

On May 20, Lai Yang, a member of the Expert Committee of the China Commerce Federation and executive vice president of the Beijing Business Economics Association, told the Red Star Capital Bureau that exporting private-brand goods through "assistance" is a win-win solution in the short term. On the one hand, Pangdonglai itself is limited in scale, and exporting its own products to third parties can also increase sales scale and gain a return on profit growth. On the other hand, for supermarkets that introduce Pang Donglai's own brand products, if the sales volume is high, it will also be a good thing for their own operations, because the prices of these goods in the supply chain are lower than that of other well-known brands.

Private brand goods have become one of the common goals pursued by the retail industry. According to the "2023 China Supermarket Private Brand Case Report" released by the China Chain Store and Franchise Association, the proportion of private brand sales of top 100 Chinese supermarket companies has increased year by year, reaching 5% in 2022.

Among them, brands such as Hema and Sam are also gaining greater pricing power by increasing the number of private brands. The above report shows that as of the end of 2022, there are more than 1200 categories of Hema's private brand products, accounting for 35% of sales; Sam's private brand sales also account for about 30%.