China's supermarket king is this one, known as the 'Land Battle King' of the supermarket world! Its average store revenue reaches 330 million yuan, astonishing the industry, and in competition with international giants like Carrefour and Walmart, it has successfully outperformed them, with per-store revenue 1.6 to 2.2 times theirs! How exactly did it achieve this? 01 It Defeated Carrefour and Walmart: The True Low-Key Retail Supermarket King The King of Offline Retail in Mainland China It Defeated Carrefour and Walmart, with Per-Store Revenue 1.6-2.2 Times In the mainland Chinese market, the true supermarket king is not the international giants like Carrefour or Walmart, but it—RT-Mart. In 2010, it replaced Carrefour as the champion of mainland retail department stores. Moreover, its per-store revenue far exceeds that of Carrefour and Walmart, reaching 1.6 to 2.2 times theirs! Taking 2013 performance as an example, RT-Mart's average sales per store were 330 million yuan. Calculated on average, the sales of one of its stores equal the sales of 1.6 Carrefour stores, and are 2.2 times the per-store sales of Walmart. This Company Is Actually a Cross-Industry King: From Factory to Retail In Just 14 Years, It Became the King of Offline Retail in Mainland China What is most unexpected is that RT-Mart did not start in retail at all! In fact, it entered the retail sector halfway, forced to take a cross-industry path! RT-Mart originated from the textile industry. Due to the threat of rising labor costs and low-cost overseas competition in Taiwan's textile industry in the 1990s, the textile industry gradually became a sunset industry in Taiwan. Ruentex Group's main textile company, Ruentex Textile, faced the same problem, so Ruentex chose to cross industries and enter the retail sector. In 1996, RT-Mart was established, and in 1997, it opened its first store. In 1997, RT-Mart entered the mainland for the first time, and in 1998, it opened its first store in the mainland market (located in Shanghai). At that time, Carrefour and Walmart had already entered the mainland Chinese market. Carrefour opened its first store in mainland China in 1995, and Walmart opened its first store in mainland China in 1996. Moreover, Carrefour and Walmart had been operating in the retail sector for many years. Carrefour was founded in 1959, and Walmart in 1962, both much earlier than RT-Mart. However, in the 14th year after RT-Mart entered the mainland market, this company, which had crossed from the textile industry into retail, replaced Carrefour as the champion of the mainland retail department store industry. In 2010, RT-Mart, with revenue of 40.4 billion yuan, replaced Carrefour as the champion of the mainland Chinese retail industry. Creating a Retail Myth: No Store Closed in 19 Years Since Entering Mainland Still Achieved Counter-Trend Growth in 2016 The Myth of No Store Closure in 19 Years After entering the mainland market, RT-Mart also created an astonishing myth: from 1997 to 2015, it did not close a single store for 19 years. This record was not broken until the end of 2016, and the reason was not RT-Mart's own operational issues, but due to disputes arising from property ownership expiration. RT-Mart's own operations were fine, but the leased property plaza fell into dispute, forcing the store to close. This so-called 'Rolls-Royce' of Chinese stores is not just bragging. In other words, in the 21 years since entering the mainland market, RT-Mart has not closed a single store due to its own poor management! Still Achieved Counter-Trend Growth in 2016, with Urban Retail Supermarket Share as High as 7.8% What is also admirable is that despite the current general pessimism about traditional retail department stores, RT-Mart still achieved counter-trend growth. According to statistics from the China Commercial Information Center, in 2016, the retail sales growth of 50 key large retail enterprises nationwide fell by 0.5% compared with the same period last year. However, RT-Mart and its parent company, Sun Art Retail, are clearly an exception! Sun Art Retail's 2016 annual report showed that the company achieved revenue of 100.441 billion yuan in 2016, a year-on-year increase of 4.2%; gross profit was 23.981 billion yuan, a year-on-year increase of 6.8%; net profit was 2.571 billion yuan, a year-on-year increase of 5.2%. Kantar Worldpanel's latest data also shows that among major retailers in the modern trade channel (Chinese cities), Sun Art Retail's share expanded from 7.5% to 7.8%, further consolidating its leading position. 02 The Secret of RT-Mart Becoming the King of Offline Retail Supermarkets: What Made RT-Mart's Legend What made RT-Mart's legend? What is the secret of it becoming the king of offline retail supermarkets? 1. Superb Team Building Capability To succeed in anything, you cannot do it without an outstanding team. In team building, RT-Mart is extremely outstanding, with super learning ability, super execution, and super training capability. 1. Super Learning Ability As mentioned earlier, RT-Mart did not start in retail; it entered as an outsider. In just over a decade, this retail industry newcomer became able to take on giants like Carrefour and Walmart single-handedly—it cannot be said to be anything less than a miracle! In this process, a key factor in RT-Mart's success is its super learning ability. During its foray into retail, RT-Mart cooperated with the well-known retail chain giant Auchan, and RT-Mart internally went to Auchan multiple times to learn. At one point, Auchan even lamented that years of accumulated retail knowledge had been learned by RT-Mart. From this perspective, you can see how much learning and drive RT-Mart has, and it is this kind of learning that... 2. Super Execution RT-Mart's execution is extremely strong, so strong it can be described as fierce! A senior industry insider who once served as a store manager at RT-Mart said that RT-Mart's performance assessment is extremely strict. If a store manager fails to achieve the goals promised at the beginning of the year by the end of the year, they will be removed unconditionally. For set goals, they must be achieved unconditionally. It can be said that this fierce execution is also an important reason for its fierce performance. 3. Super Training Capability Like all famous companies, RT-Mart places great emphasis on training, with unique training systems for both management trainees and other employees. In particular, its training for management trainees is very intensive. For management trainees entering the company's talent reserve team, RT-Mart has provided systematic training for over 9 months, with practical experience in stores in France, Taiwan, and the mainland market. The entire training system is practical, and some management trainees are even poached by competitors with high salaries right after training. However, this systematic training system is also a super 'arms factory' for team building, quickly enhancing employee combat effectiveness, and cultivating outstanding backbone and improving capabilities. 2. Superb Market Operation Capability In market operations, RT-Mart also has its own unique strategies, even forcing opponents to seek peace in competition. 4. Market Strategy of Avoiding the Enemy's Strength and Attacking Weaknesses Although RT-Mart's first store was opened in Shanghai, in the early stages, RT-Mart adopted a strategy of avoiding direct competition with opponents like Carrefour and Walmart. When the hypermarket format emerged in the 1990s, foreign giants like Carrefour and Walmart generally chose first-tier cities like Beijing, Shanghai, and Guangzhou first. But RT-Mart adopted a route of 'first breaking through in third- and fourth-tier cities, then surrounding first-tier cities.' RT-Mart's founder, Huang Mingduan, said: 'When RT-Mart entered the mainland, the market was already full. In 1998 and 1999, Beijing was already full of Carrefour, Shanghai was full of Lotus, and Shenzhen was occupied by Walmart. We were new to the industry and didn't really know how to do it. Basically, I thought we should avoid them as much as possible.' 'I started from third- and fourth-tier cities, then turned back to first-tier cities. This was not a smart strategy I chose; it was forced. I was afraid, so I went there.' Huang Mingduan, founder, chairman, and CEO of RT-Mart So, while the giants were investing heavily in the fiercely competitive heavy cities like Beijing, Shanghai, Guangzhou, Shenzhen, Chengdu, and Wuhan, RT-Mart made great strides in the vast third- and fourth-tier markets, and even fifth-tier markets, continuously deepening its channels, seizing the third- and fourth-tier markets in advance. After having a strong base advantage, RT-Mart began to launch a counterattack on first-tier cities. 5. Excellent Price Competition Strategy —Precise Target Audience, Fierce Price War As a retail channel, price is a key factor in competing with rivals! Whether it is traditional offline channel giants like Gome and Suning, or online channel giants like Tmall and JD.com, price is their killer weapon to stand out and surpass competitors. Similarly, in the price war to attract consumers, RT-Mart is extremely fierce. RT-Mart has precisely targeted its audience, aiming at those who are price-sensitive for daily consumer products, especially the elderly—uncles and aunties. Many households' daily consumption, such as the purchase of daily necessities like rice, oil, and salt, is done by the elderly. In terms of price, to surpass competitors and achieve true low prices in real time, each RT-Mart store is equipped with a price-check team of six to seven people, who daily sample 1,000 items frequently purchased by customers and conduct market surveys on competitors within a five-kilometer radius of the store. When a product price changes, the computer system automatically updates the product's gross margin, and the gross margin is linked to the performance of procurement staff. This flexible price adjustment mechanism, with dynamic adjustments at any time, gives RT-Mart super price appeal on daily sensitive consumer products like milk and eggs. This price war can reach such an extent that it once forced giants like Carrefour to seek a truce in the Shanghai market. Once the image of price advantage on products sensitive to the elderly is established, it forms a habit of first choice for purchases. Once this habit is formed, during shopping, consumers will also continue to buy other products, thus ensuring overall profits. To put it directly, everyone is competing for offline traffic entry points, and in this entry point competition, RT-Mart is undoubtedly more skilled! 6. Pragmatic Effectiveness In market operations, RT-Mart overall focuses on pragmatic effectiveness, flexibly targeting promotional activities in the local area. This effectiveness is not only reflected in individual stores but also in the company's senior management. The President Personally Selects Locations, and Once Selected, Persists in Opening. There is a saying in the industry: to run a store well, the first is location, the second is location, and the third is still location, showing that location plays a crucial role in store sales. RT-Mart's location philosophy is: be cautious in site selection, rather have none than a bad one. 'If it's not going to be good, it's better not to open. We pay special attention to site selection,' said Hong Wankang, assistant to the chairman of RT-Mart. To inspect properties before site selection, RT-Mart's president often lowers his status and personally goes to the field for research, thoroughly understanding the local market conditions before making the final decision. In opening stores, the president can personally go down to select locations, showing the company's pragmatic and effective style. This style has become the company's overall combat style—pragmatic and effective. 3. Superb Management Model In management, RT-Mart is also extremely strong, with real-time monitoring data management and rigorous daily operation standard management. The former tracks performance in real time and dynamically, while the latter standardizes daily operations to a high standard. This ensures high efficiency in daily operations and overall performance can be managed and adjusted dynamically at any time. 7. Unique Data Management Although big data seems to be a hot topic today, RT-Mart actually started using big data and statistical data to monitor the operations of each store and make dynamic adjustments at any time long ago. RT-Mart developed a real-time performance inquiry system for each store. This real-time store performance inquiry system is RT-Mart's secret weapon and the nerve center for implementing management into every detail. Compared with the daily settlement systems of many hypermarkets, RT-Mart achieves real-time digital management, always in a state of being wound up. When a store's performance in a certain period is lower than in the past, the backend will track and make timely dynamic adjustments, inquiring with the store, rather than delaying and letting the poor situation continue. This is very sharp. 8. Rigorous Standardized Management For retail, standardized and normalized operation is where a company's true skill is most evident. The level of standardization and normalization requirements and execution levels also reflect the level of skill! After years of systematic operation, RT-Mart has built a complete, super operating system and operating manual! RT-Mart's terminal display has always been an industry benchmark RT-Mart's most core 'secret' is the 'Sunflower Manual' circulated in the industry—the SOP standard operating procedure, which they call the 'Operations Personnel Standard Manual.' This manual is on the company's computers and is updated constantly. The operating standards have confidentiality permissions. Employees can only see the standards for their own course with their course password, and the company has always promoted that operating standards must be kept confidential, cannot be printed, and can only be viewed. Even just hygiene alone is enough to drive people 'crazy.' The store has tens of thousands of customers daily, but the floor is clean without any stains. All this comes from: regular maintenance, deep maintenance, and the floor tiles alone are polished more than ten or twenty times. At the entrance of the restroom, there is a checklist. From 7:30 AM to 10:30 PM, five items must be checked and filled in every hour, with the cleaning supervisor and customer service section chief each checking off. 'Fast response, no bureaucracy, not people-oriented but system-oriented, system above all.' This may be the hardest part of RT-Mart to replicate. First-Class Team, First-Class Market Operation, First-Class Management Creating a Retail Legend It can be said that in team building, market operations, management, and other aspects, RT-Mart has built advantages. These multi-dimensional advantages form a systematic advantage, surpassing opponents in many ways. This lead, even when facing international retail giants like Carrefour and Walmart, has strong competitiveness! Therefore, it has created RT-Mart's retail legend and the reputation of the 'Land Battle King' of supermarkets! And RT-Mart's unique aspects in team building, market operations, and management are not only worth learning from for domestic retail peers, but also for other industries and marketing professionals in the domestic business community! Yu Jianmin—Author of 'China Marketing Success Bible: Scientific Strategy Marketing' (Revised Edition), Industry Observer, Senior Marketing Management Expert -END-