---
title: "Can Pangdonglai's Assistance Help Yonghui Break the Deadlock?"
description: "According to Lianshang.com, following Jiabaile and Bubugao, Pangdonglai will launch a support and adjustment plan for Chinese supermarket giant Yonghui Superstores in June. On May 5-6, Yonghui's chairman Zhang Xuansong and CEO Li Songfeng led a team of over ten executives to Xuchang to visit Pangdonglai's chairman Yu Donglai, and also toured Pangdonglai's Angel City, logistics center, central kitchen, and employee home. During the visit, they conducted in-depth research and analysis on Yonghui's problems and discussed future development strategies. The next day, Yu Donglai, Zhang Xuansong, Pang Xiaowei, and the management team went to Zhengzhou to visit four stores, and after the visit, Yu Donglai made a major decision: to initiate a support and adjustment plan for Yonghui Superstores."
author: "New Distribution"
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published: "2024-05-08"
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# Can Pangdonglai's Assistance Help Yonghui Break the Deadlock?

> According to Lianshang.com, following Jiabaile and Bubugao, Pangdonglai will launch a support and adjustment plan for Chinese supermarket giant Yonghui Superstores in June. On May 5-6, Yonghui's chairman Zhang Xuansong and CEO Li Songfeng led a team of over ten executives to Xuchang to visit Pangdonglai's chairman Yu Donglai, and also toured Pangdonglai's Angel City, logistics center, central kitchen, and employee home. During the visit, they conducted in-depth research and analysis on Yonghui's problems and discussed future development strategies. The next day, Yu Donglai, Zhang Xuansong, Pang Xiaowei, and the management team went to Zhengzhou to visit four stores, and after the visit, Yu Donglai made a major decision: to initiate a support and adjustment plan for Yonghui Superstores.

According to Lianshang.com, **following Jiabaile and Bubugao, Pangdonglai will launch a support and adjustment plan for Chinese supermarket giant Yonghui Superstores in June.**
On May 5-6, Yonghui Superstores' chairman Zhang Xuansong and CEO Li Songfeng led a team of over ten executives to Xuchang to visit Pangdonglai's chairman Yu Donglai, and also toured Pangdonglai's Angel City, logistics center, central kitchen, and employee home. During the visit, they conducted in-depth research and analysis on Yonghui's existing problems and discussed future development strategies.
The next day, Yu Donglai, Zhang Xuansong, Pang Xiaowei, and the management team went to Zhengzhou, visiting four stores including Longhu Jinyicheng, Hanhai Beijin, Yuhua Plaza, and Gongyuanmao, and communicated with store managers, employees, and customers.
**At the closed-door meeting after the visit, Yu Donglai made a major decision: to initiate a support and adjustment plan for Yonghui Superstores.**
After the news was released, **on May 8, Yonghui Superstores hit the daily limit up, closing at 2.62 yuan per share, with a turnover of 776 million yuan, a total market value of 23.777 billion yuan, and a sealing capital of 19.9134 million yuan.**
**Can the Pangdonglai model be replicated?**
It is understood that the support and adjustment will mainly involve two stores: Zhengzhou Hanhai Beijin store and Xinxiang Baolong Plaza store. The former will start adjustment on June 1, and the latter at the end of June.
The support and adjustment will focus on several areas: supply chain, employee treatment, store layout, and traffic flow design.
**In terms of product structure, the existing Yonghui supply chain system will be the mainstay, with Pangdonglai making structural supplements.** The stores will fully adjust to Pangdonglai's product structure, significantly improving product quality and optimizing prices. Subsequent stores will also introduce Pangdonglai's popular cooked food and bakery series.
**In terms of employee management, salaries will be increased, working hours shortened, and employee happiness improved, allowing them to provide better service to consumers with a fuller state.**
According to media interviews, a staff member at Yonghui's Zhengzhou Hanhai Beijin store said, "We will make some adjustments according to their business model. For example, we previously sold shrimp without removing the vein, but in the future, if customers need it, we will offer this service."
Currently, Yonghui Superstores has 975 stores. The subsequent adjustments will be carried out gradually by Yonghui's adjustment team, under the guidance of Pangdonglai's team, based on the experience of the two pilot stores, by region and time period.
Song Xiangqing, a well-known economist and vice president of the China Commercial Economics Society, analyzed, "Pangdonglai's grafting of its business philosophy and model onto Yonghui is more like mutual leverage between enterprises to achieve a win-win situation."
Pangdonglai's chairman Yu Donglai believes that this support for Yonghui is, in a special period for the industry, a support for the overall improvement of China's supermarket industry, and also a reminder, reflection, and calibration of Chinese enterprise development concepts.
This adjustment of Yonghui is not Pangdonglai's first support to peers. In June 2023, Pangdonglai assisted Jiangxi chain supermarket brand Jiabaile; in April 2024, Pangdonglai extended a helping hand to Hunan supermarket leader Bubugao.
For Bubugao, Pangdonglai has already delivered impressive results. According to information released by Bubugao Supermarket's official WeChat on April 27, **after more than 20 days of adjustment, the Meixihu store's daily sales increased from about 150,000 yuan with an average daily customer flow of 2,000 to a peak daily sales of 1.4 million yuan and a customer flow exceeding 15,000.**
It is also worth noting that, as with previous support for Jiabaile and Bubugao, this support for Yonghui involves no fees or returns, and all costs are borne by Pangdonglai itself. According to the strategic plan, Pangdonglai will use one year to help Yonghui return to health and beauty.
Previously, industry insiders said that Pangdonglai's mechanism is directly related to its founder, and its model may not be quickly replicable. If this support for Yonghui succeeds again, it may prove that the Pangdonglai model is not impossible to replicate.
**The 'First Stock of Fresh Food' from 'Self-Rescue' to 'External Rescue'**
According to data from the National Bureau of Statistics, since 2017, the number of domestic supermarket stores has continued to decline, from a peak of 38,554 to 24,082, a drop of 37.5%. Large chain supermarkets have seen even faster declines, from 11,947 in 2012 to 5,340 in 2020, a drop of over 55%.
In the past few years, under the assault of various new retail formats, new business models, and weak consumption, traditional supermarkets have not had an easy time, with news of store closures and declining performance emerging one after another.
Facing the severe situation, major traditional supermarkets have been trying various self-rescue methods, and Yonghui is no exception.
Yonghui Superstores, once hailed as the "First Stock of Fresh Food," had a peak market value of 111.8 billion yuan, but now its market value is only 23.777 billion yuan (as of May 8 closing data).
According to the financial report disclosed on April 27, Yonghui Superstores' 2023 revenue was 78.642 billion yuan, a year-on-year decrease of 12.71%, with a net loss of 1.329 billion yuan, a reduction from 2022.
Looking at Yonghui's financial reports over the past three years, it lost 2.763 billion yuan in 2022 and 3.944 billion yuan in 2021, **recording losses for three consecutive years.**
**Despite the losses, Yonghui has made many attempts, but the results have not been obvious.**
Last year, the retail industry saw a "discount trend," and Yonghui followed suit in August by announcing the opening of "authentic discount stores" within its stores nationwide, and also added discount sections online.
In fact, several years ago, Yonghui began exploring new business formats, taking the path of "self-rescue," such as launching Yonghui mini, Super Species, and Yonghui Minsheng warehouse membership stores. But most ended in closures and failed to become new growth curves.
**On the other hand, Yonghui is also accelerating its self-transformation by closing loss-making stores, optimizing the supply chain, and strengthening digital transformation.**
Since starting store optimization, Yonghui Superstores now launches nearly 400 new products per store per month, including brands entering offline channels for the first time and new products launched exclusively in Yonghui channels.
Yonghui's new product incubation area, authentic discount area, and freshly prepared food, based on a "one store, one discussion" approach, provide consumers with a more grounded and high-quality shopping experience. Additionally, Yonghui is steadily advancing supply chain reform by restoring direct sourcing and transforming business models.
In the Q1 2024 financial report, revenue was 21.665 billion yuan, a year-on-year decrease of 8.98%, and net profit was 736 million yuan, an increase of 4.57% year-on-year. **Although initial results have been achieved, the decline has not truly been halted.**
At the same time, **internal strife is also affecting this traditional retail giant.** Since February this year, three vice presidents of Yonghui Superstores have resigned: one for "health reasons," one for "inability to perform duties," and one for "personal reasons." The executive who was "unable to perform duties" had been with the company since 2009, nearly 15 years of service.
Some netizens even commented, "The internal strife in Yonghui Superstores has become public." The sudden changes in Yonghui's senior management are superficially a personnel earthquake, but in reality, they are the inevitable pain and adjustment during the transformation process.
Pangdonglai's support and adjustment can be considered Yonghui's request for external forces to initiate the "external rescue" path. Whether it can bring new dawn to Yonghui Superstores remains to be verified by results.
**Final Thoughts**
When stuck in a swamp and slowly sinking, self-rescue can sometimes lead to sinking deeper. Seeking external help and leveraging external forces might be a solution.
From Yonghui's perspective, when repeated "self-rescue" attempts have not met expectations, cooperating with Pangdonglai may be a good way to break the deadlock.
As a traditional retail giant, whether Yonghui Superstores can return to its glory days remains to be answered by time.
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