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  1. From direct-operated convenience stores to self-operated B2B, and then to information matching, why did this B2B platform make such a transformation?
  2. How did he cover nearly 8,000 outlets in one year?
  3. How does he empower the supply chain without touching goods and warehousing and distribution? The offline trillion-yuan retail market has never lacked reconstructors. National B2B platforms such as JD New Route, Alibaba Retail Link, and Zhongshang Huimin are representatives. In addition to these internet giants with abundant funds and leading technology, there are also regional B2B platforms springing up like mushrooms, such as Dianda and Xianshiji in the Yangtze River Delta, No.1 Life and Zhangshang Kuaixiao in South China, and Xingaoqiao in Hunan. The platform we are going to talk about today is Bianlibao, which mainly serves Fujian Province. Public data shows that Bianlibao was established in 2009, mainly serving the five districts and eight counties of Fuzhou, and has now expanded to surrounding areas such as Fuqing, Putian, and Zhangzhou. The platform's product categories include alcoholic beverages, leisure food, daily chemicals, grain and oil seasonings, etc., with over 40,000 SKUs, more than 600 cooperative suppliers, and an annual GMV of nearly 400 million yuan. So, what are the differences between Bianlibao and other regional B2B platforms? 1 From Convenience Store to B2B Platform In 2009, Bianlibao was established in Fuzhou, initially positioning itself as a convenience store enterprise. By imitating 7-11's management and display methods, Bianlibao pioneered the 24-hour full-time operation model in Fuzhou and successfully opened more than 20 self-operated convenience stores in the city, ranking among the top three convenience store chains in Fuzhou. The prototype of the Bianlibao system came from the ordering system used by the company's internal purchasing staff. To facilitate the purchasing department's product procurement, Bianlibao developed a platform system for suppliers to update product status. In 2011, the Bianlibao system was launched for suppliers. As technology matured and user experience improved, upstream suppliers became increasingly reliant on this supply system. However, at the same time, problems in the convenience store market expansion gradually emerged. Chen Hui, founder of Bianlibao "The profit cycle of convenience stores is too long," Chen Hui told New Distribution. "The positioning of high-end convenience store brands determines that our store locations are mostly in business districts and around residential areas. However, rents around business districts are generally high, and store revenue may not support the high rent; stores around residential areas have relatively lower rents, but they require a longer customer cultivation period. After customers' consumption habits are formed, the store lease is almost up, and renewal often comes with doubled rent." At that time, the customer acquisition cost on the internet was not as high as it is now, and offline convenience stores had not yet become the windfall pursued by capital. Under such circumstances, transformation became a question that Chen Hui had to consider. "For upstream suppliers, the greatest value of convenience stores is the channel. Since it is about channels, if opening stores doesn't work, why not do the supply chain ourselves? " Years of industry experience also made Chen Hui see the pain points of traditional retail stores: difficulty in purchasing, usually having to go to distant wholesale markets; uneven quality of purchased goods, with counterfeit and near-expiry products being common. For Bianlibao, which already had a complete procurement system and mature supply chain, this was undoubtedly an opportunity. 2 From Closed to Open In 2012, Bianlibao increased its openness to suppliers and began gradually supplying non-franchised stores. The significance of this was not only to improve bargaining power with upstream suppliers but also to increase store coverage density, thereby reducing the fulfillment cost per order. However, things did not go as smoothly as imagined. During the process of supplying non-direct-operated stores, new problems arose. "In market operations, we found that our centralized procurement cost was not much lower than the purchase price of traditional retail stores, and the selling price of some products was even 5-10 percentage points higher than the purchase price of traditional retail stores. " The main reasons for this situation are as follows:

1. Payment terms: The platform self-purchases and self-sells, but due to the limited number of stores, its bargaining power with upstream suppliers is limited, and suppliers' supply prices are often higher than market prices;

2. Uneven purchasing staff levels: The price of purchased goods is not only related to the value of the goods themselves, but also the relationship between purchasing staff and upstream suppliers is an important factor, which places high demands on their industry experience and professional quality;

3. Inconsistent store demands, unable to form scale procurement advantages: The decentralized layout of convenience stores determines that the products sold by each store vary greatly, and the demand for personalized products is small, so centralized procurement cannot bring cost reductions; "No one knows the store and the products it sells better than the store owner, so later we simply cut the purchasing department and handed over the purchasing rights to the store managers and small store owners. Then suppliers supply the goods themselves, and we only handle order matching and warehousing and distribution matching. " In September 2014, the Bianlibao system was officially launched, fully open to upstream suppliers and stores, and gradually closed all direct-operated stores. After several years of trial and error, Bianlibao officially entered the fast lane of development. In October 2015, one year after its launch, Bianlibao completed coverage of 70% of Fuzhou's stores and began to gradually penetrate surrounding markets such as Fuqing, Ningde, Putian, and Yongtai. It is worth mentioning that on December 16 of the same year, JD's B2B project, JD New Route, was officially established. At the same time, the rapid development of Bianlibao also attracted the attention of the All-China Federation of Supply and Marketing Cooperatives. In 2017, Bianlibao launched a strategic cooperation with the All-China Federation of Supply and Marketing Cooperatives, and began cooperating on cloud warehouse construction in some markets in Fujian. The reason why the All-China Federation of Supply and Marketing Cooperatives chose to cooperate with Bianlibao, besides its rapid development, Chen Hui believes there are two other reasons: 1. Not disrupting the original FMCG distribution hierarchy The FMCG distribution industry has a huge market stock, and the traditional distribution hierarchy still has irreplaceable value. Unlike most self-operated B2B platforms in the industry, Bianlibao does not touch goods; the platform itself does not engage in product operations, does not disrupt the original distribution system and hierarchy, and brand owners, distributors, and secondary wholesalers can all use the platform to complete digital upgrades. 2. Decentralized cooperation form Currently, other matching platforms in the industry achieve empowerment of local distributors by cooperating with regional distributors and establishing "enterprise partners" and "service stations." However, because "enterprise partners" and "service stations" are exclusive, it is difficult for different distributors of the same category to cooperate, and they easily form opposition. Bianlibao does not interfere with the daily operation and management of distributors; it only provides an information tool. The platform only charges a product information management fee, and all product categories can be listed on the platform. Distributors of different brands can operate freely on the platform. 3 Digital Empowerment of the Industrial Chain In addition to the digital upgrade of the upstream supply chain, for downstream retail terminal stores, Bianlibao has taken the following two measures: 1. Opening online stores, connecting with Ele.me, breaking the spatial limitations of store operations The success of traditional convenience stores often depends on store location; the more foot traffic, the better the business. Opening online stores can effectively reduce the dependence of store business on location, breaking the time and space limitations of store operations. In December 2016, Bianlibao officially launched the personal WeChat ordering function, and more than 8,000 registered users in Fuzhou automatically opened WeChat online stores. After users place orders online, delivery can be made within 30 minutes, breaking the time limitations of traditional convenience store operations. In addition, Bianlibao also cooperated with Ele.me to help Bianlibao users automatically open Ele.me online stores, truly realizing online traffic diversion for offline stores, thereby breaking the spatial limitations of traditional convenience stores relying on store location. "Many traditional small retail stores do not have the ability to operate mobile phones. The integration of Bianlibao users with WeChat and Ele.me online stores can effectively reduce the learning cost for store owners, promote the sales of their store products, enhance store stickiness, and also drive the sales of platform suppliers' products, " Chen Hui said. 2. Launching one-item-one-code to ensure the safety of products sold on the platform Because of the platform attribute, merchants can freely sell products on the platform. Although the richness of products has been greatly improved, product quality issues are often one of the main reasons why platforms are criticized. Bianlibao's solution to this problem is one-item-one-code. On November 3, 2017, the Bianlibao platform officially launched one-item-one-code, enabling every product arriving at a store to be tracked from product warehousing to sorting, transportation, distribution, and sales. Chen Hui believes, "China does not lack good products. Consumers' concerns about product safety often lie not in the product itself, but in the circulation process. The reason why consumers are willing to shop at Walmart, RT-Mart, and other supermarkets is not only the price factor, but more importantly, trust in the product distribution channel. What Bianlibao wants to achieve through one-item-one-code is not only anti-counterfeiting and traceability of the product itself, but also the brand effect of the platform and cloud warehouse distribution externally. " From the development case of Bianlibao, it is not difficult to see that Bianlibao's control of the market and service to stores are quite solid. The platform's current main revenue comes from product information management fees, warehousing and distribution matching service fees, and marketing expenses. From the development case of Bianlibao, it is not difficult to see that after the early rapid development, the B2B industry itself has derived multiple development models: Pure self-operated model: All products are self-purchased and self-sold, such as JD New Route and No.1 Life;

Self-operated + joint operation model: Some products are self-operated, while others (such as fresh and short-shelf-life products) are jointly operated with regional distributors;

Self-operated + SaaS model: Some markets are self-operated, while others export systems and management models, such as Dianda and Lianpin;

Pure matching model: Do not touch goods, do not build logistics, typical representative is Hui Xiadan;

Partial matching model: Order matching, but intervene in warehousing and distribution, such as Alibaba Retail Link and Bianlibao. Classified by platform origin, they can be divided into: Native B2B platforms: Originated from internet companies, such as Zhongshang Huimin and Yijiupi;

Retail-type B2B platforms: Originated from retail enterprises, later using their own supply chain advantages to enter the B2B field, such as RT-Mart e-Lufa and Xi'an's Meiyitian;

Distributor-type B2B platforms: Traditional distributors transformed into B2B platforms, such as Hebei's Dunjie, Chengdu's Hui Jinhuo, and Rongcheng Yigou. The FMCG B2B industry is developing rapidly, and the number of model derivatives is numerous, so I will not list them all. However, it is undeniable that the entire FMCG industry has begun to awaken, and traditional distribution channels are facing a digital transformation and reconstruction. For traditional distributors, the transformation path is not replicable. Whether it is building a B2B platform, cooperating with regional distributors for unified warehousing and distribution, or cooperating with other B2B platforms, the path that suits your own development is the optimal path for transformation. The digital trend is irreversible. No matter what method is used for transformation, efficiency improvement is the eternal core demand of business change. In this process, some will fall behind, and some will overtake through the internet, but no one can be an island. Only distributors who are brave to change and seize opportunities can avoid being eliminated by the times. -END-