As the nation's overall economic strength improves and consumer demand shifts, China's leisure snack market continues to develop. In this forward-moving wave, bulk snack stores, known for their ultra-high cost-performance ratio, have surged ahead with unstoppable momentum. From the first introduction of the 'bulk snack' concept by Laoban Daren in 2010 to the current integration and mergers among leading brands, bulk snacks have acted like a catfish entering a school of sardines, swiftly breaking the original equilibrium of the leisure snack market, bringing vitality and challenges, and will achieve a new harmony in the future. In response, various voices have emerged in public discourse: some believe bulk snack stores will replace distributors, while others argue that 'you get what you pay for' and that bulk snack stores will still lose to distributors. But let us reconsider: are bulk snacks and distributors necessarily in a replacement relationship?
Observing from the Sidelines, a Growing Sense of Crisis 'Acting in accordance with reason makes success easy; acting against the times makes achievement difficult.' For distributors in the food sector, this is especially true. Facing the bulk snack trend, many distributors are uneasy, worrying that this 'aggressive' newcomer will disrupt the existing circulation system and pricing structure of the market. Such concerns are not unfounded. According to the conventional distribution channels we are accustomed to, a company's products must pass through multiple tiers—distributors, secondary wholesalers, and retailers—before reaching consumers. However, for bulk snack stores, when the terminal retailer becomes powerful, it can exist independently of the existing channel chain. For some large stores, the food production chain can be reduced to just two links: the production enterprise and the bulk snack store. Brands consolidate logistics providers, distributors, and retail terminals into one, allowing products to go directly from the factory to each store, leaving distributors facing significant challenges.
At the same time, the lower gross margins of bulk snack stores have also caused concern among many distributors. According to the 'Leisure Snack Industry Research' report by China Securities, bulk snack stores have an average transaction value of 30–40 yuan, with store gross margins around 20%, while traditional snack stores have an average transaction value of 50–70 yuan and gross margins typically above 45%. The cost-performance advantage of bulk snack stores is evident, and their strategy of passing savings to consumers has attracted many buyers, with daily transaction counts potentially reaching 4–5 times that of traditional snack stores. The high repurchase rate driven by high cost-performance is also something traditional snack stores lack.
When a crisis looms, avoidance is a natural psychological reaction. However, Mr. Wu from Liuzhou Xuelilai Trading shared with reporters: 'Having a sense of crisis is a good thing. As the old saying goes, "Poverty breeds the desire for change." The harder the times, the more opportunities. When the internet intervened, we felt a strong sense of crisis, which directly drove our development of online channels. Whether it's live streaming or community group buying, it's all been pushed forward by that sense of crisis.'
Entering the Game: Opportunities and Challenges Coexist Facing the various impacts of bulk snack stores, many distributors have chosen to enter the fray, while others have switched tracks and transformed their identities to become brand operators. For example, Luo Jingwei, chairman of Dalian Yijia Commerce, founded his own brand 'Luobashi'. Currently, Luobashi products have covered all partner stores in the Dalian area and have expanded to more than 50 distributors across several prefecture-level cities in Heilongjiang, Jilin, Shandong, Hebei, and other provinces, with growing reputation and acclaim. Besides creating brands, many distributors have also started from logistics, becoming delivery providers. For instance, Mr. Nan, who handles catering channel delivery for Baqi in Shunyi, Beijing, achieves an annual delivery volume of 80 million yuan, which is quite substantial.
Compared to seeking alternative paths, choosing bulk snack stores seems to be the most direct and timely option. Ding Qiang, founder of Hongyixing (Shandong) Brand Operation Management Co., Ltd., actively entered the snack sector after noticing the slowdown in traditional channel growth. In August 2019, Ding opened the first Hongyixing store in Lanshan District, Linyi, covering approximately 3,000 square meters, combining food wholesale and brand discount features. After several years of development, facing the bulk snack trend, Ding responded promptly by connecting with over 500 upstream food manufacturers and launching 'Hongyixing Snack Factory', which adopts a paid membership model and focuses on lower-tier markets. Currently, Hongyixing Snack Factory has opened more than 30 stores, with cumulative paid members reaching 50,000.
Behind the enormous business opportunities lies intensifying competition. Ding's success is built on over 30 years of resource accumulation and experience in the food sector. Distributors who lack strong supply chains and professional product selection teams are more cautious when facing this trend. 'Now when we walk down the street, we can even see two or three snack chain stores on a single street, and competition is very fierce,' said Weng Youyi, chairman of Fuzhou Fangyuan Food Trading Co., Ltd. 'If there's no supply chain advantage and you only compete on price, it's easy to become homogeneous and lack competitive advantage. In my view, after 3–5 years of consolidation, possibly 80% of small-scale bulk snack stores on street corners will disappear.'
Development: Prioritize Quality Control and Service With the leading bulk snack brand 'Snacks Are Busy' acquiring peer 'Qiahuo Puzi', and the listed company Wanchen Biology's brand 'Four-in-One' merging, countless companies and consumers tacitly understand that competition in the bulk snack track will intensify, and a reshuffle is imminent. Facing the upcoming 'big melee', how to extend the dividend period of bulk snacks as long as possible and maintain a firm foothold in the ever-changing market has become a question for many entrants.
'Attracted by appearance, impressed by talent, loyal to character'—this is not only a reflection of life but also a recipe for stores to retain consumers. Whether it's the storefront or the snacks, consumers first notice the packaging. Therefore, many brands and stores have put effort into 'appearance'. For example, the trendy brand WHIKO Mystery Creature uses a genderless, speciesless egg-born creature WHIKO as its image IP, winning the hearts of 30 million fans across the internet. Beyond IP building, WHIKO Mystery Creature entered the snack track in 2020 and designed packaging based on the consumption scenarios of each snack, attracting the attention of many young people and achieving a very successful IP commercialization.
Similarly, when we look at bulk snack brands, we find that many have created their own unique IP images. For instance, Hongyixing Snack Factory has created an orange-red IP character with a round head and an ever-present smile, which not only 'catches the eye in a second' but also provides consumers with a memory anchor. The cute image seems to make 'eating snacks' even more enjoyable, killing multiple birds with one stone.
If appearance is a brand's soft power, then product quality is the hard indicator affecting repurchase rates for leisure snack consumers. Even bulk snack stores, which adhere to the motto of 'more, faster, better, and cheaper', still rely on 'good quality and low price' as their fundamental logic. At the 2023 China Snack Chain Store Innovation Forum, Li Lei, president of Liaocheng Haojiayi Bio-Dairy, emphasized the need to select 'extremely cost-effective good products' rather than 'extremely cheap products'. 'Only engaging in price wars does not align with consumer logic. Bulk snack stores must strengthen control over product selection.'
Whether it's appearance or quality, everything ultimately comes down to the consumer. For bulk snack stores, being people-oriented, strengthening service awareness, and focusing on consumer experience and interaction may be the key to sustaining the industry's dividend. In this regard, the store manager of a Laoban Daren store in Yuyao shared: 'At this stage of development, we must still adhere to brand leadership and maintain quality control standards. For bulk snack stores, advantages in product or supply chain are roughly equal. So, what ultimately attracts consumers, besides higher cost-performance price advantages, I believe, comes down to service in maintaining customer relationships.'
Survival of the fittest and adaptation are the cruel laws of nature, and they are also the market rules of the food track. However, when we re-examine the 'bulk' and 'sale' of 'bulk snacks', we find that there is no fundamental difference between the work of bulk snack stores and distributors. The relationship of 'people, goods, and places' still exists. It's just that with the times, today's consumers need a faster, more economical way to enjoy the pleasure of snacking, and bulk snacks happen to meet that market demand. From this perspective, even if bulk snack stores had not emerged, the traditional distribution model would still need to evolve with the times. So how can there be talk of 'replacement'? Whether driven by external forces to upgrade or by internal development to seek change, both paths will ultimately lead to a more prosperous and beautiful snack consumption market. The future is promising!