---
title: "Businesses Distributors Can't Do Anymore, Retailers Are Grabbing!"
description: "In the past, the FMCG market had competition, but each party—manufacturers, distributors, and retailers—stuck to their own business. Recently, the industry trend has changed drastically: terminal stores are shrinking, and distributor inventories are high. The traditional division of production, supply, and sales is being broken. Manufacturers are directly connecting with retail terminals, and traditional retailers are building their own supply chains, internalizing distributor functions. Retailers are increasingly taking over distributors' business."
author: "汪海"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2025-07-11"
categories: "Dealer Operations"
language: "en"
canonical: "https://xinjignxiao.com/en/articles/businesses-distributors-can-t-do-anymore-retailers-are-grabbing-173ce637/"
markdown: "https://xinjignxiao.com/en/articles/businesses-distributors-can-t-do-anymore-retailers-are-grabbing-173ce637.md"
original_source: "https://mp.weixin.qq.com/s/fspeorLeflQK9LewEPdybw"
translation: "https://xinjignxiao.com/zh/articles/%E7%BB%8F%E9%94%80%E5%95%86%E5%B9%B2%E4%B8%8D%E4%B8%8B%E5%8E%BB%E7%9A%84%E7%94%9F%E6%84%8F-%E9%9B%B6%E5%94%AE%E5%95%86%E4%BB%AC%E6%8A%A2%E7%9D%80%E5%B9%B2-173ce637.md"
attribution: "New Distribution — https://xinjignxiao.com/en/articles/businesses-distributors-can-t-do-anymore-retailers-are-grabbing-173ce637/"
citation: "汪海. “Businesses Distributors Can't Do Anymore, Retailers Are Grabbing!.” New Distribution, 2025-07-11. https://xinjignxiao.com/en/articles/businesses-distributors-can-t-do-anymore-retailers-are-grabbing-173ce637/"
usage_policy: "https://xinjignxiao.com/ai-policy.txt"
---

# Businesses Distributors Can't Do Anymore, Retailers Are Grabbing!

> In the past, the FMCG market had competition, but each party—manufacturers, distributors, and retailers—stuck to their own business. Recently, the industry trend has changed drastically: terminal stores are shrinking, and distributor inventories are high. The traditional division of production, supply, and sales is being broken. Manufacturers are directly connecting with retail terminals, and traditional retailers are building their own supply chains, internalizing distributor functions. Retailers are increasingly taking over distributors' business.

In the past, the FMCG market, despite competition, was well-organized with each party doing their own business: manufacturers, distributors, and retailers each had their own roles, non-interfering and non-invasive.
But in recent years, it's clear that the industry trend has completely changed. Terminal stores are continuously shrinking, and distributor inventories are high. The traditional division of "production, supply, and sales" is being broken.
We see many manufacturers shifting from merely producing and developing regional distributor business to directly connecting with terminal retail, replacing traditional distributors in serving retailers.
Traditional retailers are starting to build their own supply chains, internalizing distributor functions. While supplying themselves, they expand outward to B-end customers, replacing traditional distributors in supplying small shops and supermarkets.
When today's distributors still simply define their competitors as "so-and-so distributor," they are unaware that more and more retailers are frantically "stealing" their business.
# **Jiangsu Hongxin Supermarket:**
# **Wholesale Business Exceeds Retail**
# **Riding on "Delivery" to Hong Kong Stock Market**
Hongxin Supermarket was established in 2007, with stores mainly in county-level cities and towns in Jiangsu Province, areas with relatively high population density but weak commercial infrastructure.
According to media reports, Hongxin has 49 supermarkets and 108 convenience stores in Yangzhou, with a market share of 9.1% in 2023.
In supply chain, Hongxin adopts a dual-track model of "direct procurement + local procurement." On one hand, it establishes direct procurement cooperation with upstream agricultural product bases and manufacturers, reducing intermediate links to ensure low-cost procurement; on the other hand, it actively supports local suppliers, forming a flexible and efficient supply network.
Hongxin also holds regional distribution rights for 15 well-known brands, covering dairy, liquor, and other categories.
Deep cultivation in the supply chain has laid a solid foundation for its B-end business.
From 2021 to the first nine months of 2024, Hongxin Supermarket's retail revenue was approximately 889 million yuan, 788 million yuan, 689 million yuan, and 418 million yuan, accounting for 62.0%, 59.3%, 49.1%, and 41.6% of total revenue, respectively.
During the same period, wholesale revenue was approximately 525 million yuan, 512 million yuan, 687 million yuan, and 572 million yuan, accounting for 36.7%, 38.6%, 49.0%, and 56.9% of total revenue.
Today, more than half of Hongxin's revenue comes from wholesale supply rather than its own stores.
This path works because Hongxin has established a dense store network in lower-tier areas, while accumulating a complete set of capabilities in product procurement, logistics, warehousing, turnover, and settlement, enabling efficient supply to nearby mom-and-pop stores and small supermarkets.
Therefore, Hongxin is no longer a "traditional supermarket" but a "regional distributor doing retail."
# **Hunan Leerle:**
# **Redoing Retail with Wholesale Methods**
When it comes to hard discount, no one can bypass Leerle.
As the originator of hard discount in China, Leerle initially opened the lower-tier market with extreme low prices, but what many overlook is that its core is not "cheap" but "circulation."
In supply chain, Leerle has established close strategic alliances with over 230 suppliers, gaining absolute initiative in the supply chain through large-scale procurement and cash settlement.
In procurement, large-scale purchasing allows Leerle to obtain goods at lower prices, reducing procurement costs; cash settlement enhances trust with suppliers, further securing better prices, making standard products a strong advantage.
In the early days, franchisees only needed to unify brand identity and connect to the supply chain system, without bearing complex operational management costs, to enjoy franchise policies. Through an open "loose" franchise model, Leerle quickly built a massive scale.
**This model has led many traditional mid-sized supermarkets and small shops to voluntarily put up Leerle's signage, cooperate with it, and obtain more price-competitive goods.**
As of 2024, Leerle franchise stores account for over 90%, becoming the main force for store expansion. The average payback period for a single store is controlled at 12-18 months, far lower than the industry average of 3 years, enabling franchisees to quickly achieve profitability and enhancing their confidence and loyalty.
Leerle also uses a "county-level integrated store-warehouse" layout, effectively integrating warehousing and stores, reducing intermediate links, further lowering logistics costs, and helping franchisees rapidly replicate and expand in lower-tier markets, achieving a win-win situation for both brand and franchisees.
Leerle's Shanghe International Warehouse Store is an offline store under the retail-distribution integrated model, operating for 3 years, located next to Changsha Gaoqiao Wholesale Market, covering 22,760 square meters, doing both retail and wholesale. **Retail sales average about 600,000 yuan per day, while wholesale reaches over 2.7 million yuan daily.**
By redoing retail with wholesale logic, many small shop owners also proactively go to the store to stock up in bulk.
Today, Leerle is not just "opening stores" but "bringing supply chains to open stores and supply goods," continuously amplifying overall scale. This "both retail and wholesale" model brings ultra-high capital turnover efficiency and bargaining power.
# **Northeast Supermarket King Biyoute:**
# **Being a Retailer Who Understands Wholesale & a Distributor Who Understands Retail**
As a veteran supermarket in Northeast China, Biyoute started in 1996 in Hegang, now a "trendy small city."
Biyoute positions itself as "Northeasterners' family purchaser," known for rich product variety, affordable prices, and quality service, with stores in Hegang, Harbin and surrounding areas in Heilongjiang, Shenyang and Dalian in Liaoning, and Changchun and Tonghua in Jilin.
To some extent, Biyoute's rapid development today benefits from proactive changes in the supply chain.
In 2019, Biyoute noticed its store prices were higher than street-side small shops, so it voluntarily abandoned the traditional supermarket backend model and worked with suppliers to provide price-competitive products to customers.
In 2023, Biyoute founder Meng Fanzhong conceived the idea of establishing Zhenshimei Supply Chain Company, a collective distribution warehouse initiated within the Baoting Commercial Alliance framework.
After more than a year of development, Zhenshimei currently has about 60-65 supermarket system customers, with over 1,000 stores. Its business has covered provinces including Northeast China's three provinces, Shandong, Hebei, Inner Mongolia, Anhui, Henan, and Jiangsu.
The number of partner brands has increased from 80 to 460. In 2025, it is expected to reach 600-800 brands, with combined sales of Jinan and Shenyang Zhenshimei companies between 4-5 billion yuan.
When Zhenshimei was first established, it was based on the concept of collective procurement for supermarkets. Later, they clarified their positioning: focusing on serving chain supermarkets, being a distributor who understands retail.
Coming from a supermarket background, Zhenshimei better leverages its advantages to provide exclusive services to chain supermarkets.
**The establishment of Zhenshimei was not to go outward, but for Biyoute to reconstruct from internal efficiency, gradually forming toB capabilities, and finally expanding externally. It is precisely because of such reforms that Biyoute itself has been continuously improved.**
# Xi'an Every Day & Bang Bianli:
# Making Convenience Stores the City's "Capillaries"
Every Day convenience store was founded in Xi'an in 2010. According to the "2024 China Convenience Store Top 100" recently released by the China Chain Store & Franchise Association (CCFA), Every Day convenience store reached 2,210 stores in 2024, ranking 16th on the list.
In 2017, Every Day founded its wholly-owned sub-brand "Bang Bianli." Bang Bianli mainly operates in B2b model, currently with over 6,500 SKUs.
Based on Every Day's business, Bang Bianli has its own insights in consumer research, providing better product assortments based on store size, surrounding population, shelf count, etc.
Convenience stores doing B2b is not new; previously, New Distribution reported on Meiyijia's sister company Caihua Trading. However, Bang Bianli's B2b business logic is vastly different from Caihua Trading.
While providing supply chain, Bang Bianli also offers franchise services.
In cold chain products, Bang Bianli has a complete cold chain system. Most traditional small shops do not have the space and equipment to accommodate a large number of refrigerated products like convenience stores.
Therefore, traditional small shops can upgrade to a unified signage and standard franchise cooperation relationship through ordering relationships with Bang Bianli, upgrading their stores to provide consumers with a better shopping experience.
In 2024, the total number of stores of the Top 100 convenience store companies was 196,000, a net increase of 14,000 from the previous year. Among them, Meiyijia ranked first with 37,943 stores; Sinopec Easy Joy ranked second with 28,635 stores; PetroChina Kunlun Haoke ranked third with 19,700 stores; and the fourth, Guangdong Tianfu, had only 7,521 stores.
The convenience store track is already a red ocean, with obvious Matthew effect, and a gap between the top three and the fourth. Continuing to climb in this business is indeed not easy. Adopting a dual-brand strategy like Every Day, exporting supply chains, might be one of the "solutions" for today's convenience store systems.
Final Thoughts
**Retailers doing wholesale and B2b is not "crossing borders" but "following the trend."**
Retail doing trading, although slightly different from its own business logic, in traditional relationships, the retail end is closer to consumers, so it relatively better understands how terminals need to operate, what products sell better, and what services to provide to help them sell better. Local small and medium retail stores also need more stable and reliable suppliers.
The cooperation between the two seems like a conflicting competitive relationship, but in reality, it is a perfect two-way choice.
Changes in terminal demand have made the traditional circulation chain no longer competitive. Therefore, whether retailers or distributors, they need to choose more valuable partners and find new value positioning and growth curves.
New Distribution has observed that many retail enterprises are continuously deepening their supply chains. Retail doing supply chain is by no means a smooth path, nor can it completely replace distributors, but it must be admitted that as the target of this revolution, today's distributors' living space is being rapidly compressed...


---

## Citation metadata

- Publisher: New Distribution
- Author: 汪海
- Published: 2025-07-11
- Canonical: https://xinjignxiao.com/en/articles/businesses-distributors-can-t-do-anymore-retailers-are-grabbing-173ce637/
- Original source: https://mp.weixin.qq.com/s/fspeorLeflQK9LewEPdybw

## Copyright and AI use

This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL.

Contact: zhaobo258@gmail.com · +86 158 5481 7671