May 15, 2019

Retail Market Observation In China - The Development Of Fresh Food E-commerce

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The few profiteers of fresh e-commerce cannot hide the difficulties of industry development.


On May 10, the founder of Benlai.com announced that LBenlai C had made a full profit in 2018, and Missfresh.cn also announced that it would achieve positive cash flow nationwide. When fresh e-commerce speeds up shuffling, some enterprises have a new way of life, such as pre-warehouse, offline store, B-terminal service, etc.


However, in fact, from the rise to the outbreak of fresh e-commerce to the present, the announcement of profit is less, and the problem of the control of fresh cost has not been solved very well.


Industry insiders believe that, although part of the profits are achieved, in the stronger market environment, with resources and scale constantly gathering to the top enterprises, the time and space left to the primary and secondary fresh e-commerce platform will continue to shrink.


Few profiteers

In the context of the collective collapse of the fresh e-commerce force, some fresh e-commerce platforms finally ushered in the dawn of profit. However, the emergence of profiteers is far from the start time. It has been more than seven years since the emergence of all kinds of fresh e-commerce in 2012. There have also been several rounds of blood exchange and adjustment. From traditional vertical e-commerce to pre-warehouse, group-building and other modes, whether giants or regional entrepreneurs, there are not many enterprises that really survive and declare profits, and the "death" list may be able to list a bunch.


Cost Anxiety Is Difficult to Solve

For fresh e-commerce, it is possible to disperse and lose users at any time, as well as the high supply chain and performance costs are the main problems that restrict the development of fresh e-commerce. A person in the fresh e-commerce industry told reporters that the refrigerant and other temperature control equipment is very important to keep fresh products fresh, which also causes the high cost of performance. But if it is fresh products such as ordinary vegetables, the unit price is not high, and the gross profit is not high, so it is difficult to cover the cost. If we want to make high-end goods, the gross interest rate can be raised, but because of the high price, it will lose many consumers, and it is difficult to attract the mainstream consumer groups.

 

Whether in terms of goods or services, the original advantages of life compared with similar e-commerce platforms are not obvious, and the traffic and cost anxiety faced will be magnified. Zhuangshuai, the founder of Bailian Consulting, said that consumer’s consumption habits are too fragmented, people are facing more and more e-commerce choices, and competition is increasing. E-commerce platforms are generally facing the pressure of user reflux. How to promote limited users to return to the platform is a question that e-commerce has been thinking about. Generally speaking, the way for e-commerce to expand users is to expand categories on the one hand, and to expand sales methods and contacts on the other hand, but it is not easy to find sustainable and effective ways in these two aspects.


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