Dunjie Supply Chain Management Co., Ltd., located in Shijiazhuang, Hebei, is a localized B2B platform. Before November 2017, Dunjie was merely a traditional secondary distributor. In just six months, Dunjie has leaped to become a well-known local FMCG B2B platform. Recently, New Distribution exclusively interviewed Qiang Huitao, CEO of Dunjie Supply Chain, to report on how this businessman with nearly 20 years of traditional trading experience disrupted his original business model and transformed into a local B2B platform in six months. We hope his transformation journey offers some inspiration to readers.

01 5x Growth in 3 Years but Lost Direction Dunjie's predecessor was Jiujiu Daily Chemicals, founded in 1997, focusing on distribution of daily chemical products. In 2008, Dunjie began to venture into upstream supply chain, doing OEM branding. In 2011, it upgraded to expand into full categories, focusing on snacks and general merchandise. In 2015, Dunjie established a merchandiser team, and sales grew 5 times in 3 years. Qiang Huitao recalled that Dunjie had no capital, no connections, and could only rely on itself. As a private enterprise, Dunjie has been constantly changing. Even with 5x sales growth in the past three years, Dunjie still felt immense pressure, which drove it to continuously seek innovation. Being vigilant in times of peace is a basic quality every businessperson should possess. Before the transformation, Dunjie had annual sales of 90 million yuan, spanning snacks, general merchandise, stationery, daily chemicals, etc., with over 5,000 SKUs, more than 110 merchandisers and salespeople, and covering nearly 10,000+ outlets. Qiang Huitao told New Distribution that in the past, he and his team had been working with their heads down, relying entirely on experience, confined to their own small plot for upgrades and changes, never going out to look at trends or policies. Since 2016-2017, he felt the market undergoing tremendous changes. Tmall Xiaodian and JD Convenience Stores appeared in the outlets Dunjie covered. Various B2B platforms like Zhongshang Huimin and Zhanghe Tianxia approached him to source goods from Dunjie. But at that time, Dunjie didn't know what these people were doing. At most, there were more than a dozen distribution center signs hanging downstairs of the company; Dunjie had become someone else's distribution center. Only then did they realize something was wrong. Dunjie began to truly sense the crisis, and it was a life-and-death crisis. In November 2017, Dunjie embarked on a path of self-transformation.

02 Race Against Time in Preparation This time, they couldn't rely on past experience to change. With the crisis looming, Dunjie's decision-making layer spent three weeks gathering all industry materials and research reports, reading, learning, thinking, and analyzing. Qiang Huitao recalled, "Having been in trading for 20 years, we had never heard of new retail, unmanned shelves, or unmanned convenience stores. After three weeks of study and discussion, we finally had a revelation. We understood that Dunjie's business was called supply chain, and the distribution trend was B2B. After understanding this, we decided to transform. In the past, Dunjie lived for today without thinking about tomorrow, but this time we wanted to make a three-year plan, a complete top-level design, redefine Dunjie's business model, and reposition ourselves." Qiang Huitao compiled a 36-page PPT outlining a set of business logic and development direction suitable for Dunjie. He told New Distribution, "We want to change our previous way of doing business, and this change is disruptive. It's not enough for just the decision-makers to know; employees must also know. If employees' mindsets don't change and no one executes, the direction and strategy are just empty words, meaningless." In December 2017, Dunjie began to slowly 'lay the groundwork' for the transformation internally. Dunjie published articles about new retail on its internal official account, urged employees to read them, and asked them to write reading reflections. Qiang Huitao told New Distribution, "We positioned the subscription account as a window for employees to understand the company and the market. Let employees know the latest company information, and let them know the company's changes and development. On the other hand, the subscription account is also a platform for employees to access learning materials." Qiang Huitao would carefully read the reflections submitted by employees in the backend every day, noting employees with ideas for future talent reserves. In February 2018, at the annual meeting, Dunjie officially announced the transformation. On the 25th day of the twelfth lunar month, five days before the Chinese New Year, at Dunjie's annual meeting, Qiang Huitao officially announced Dunjie's transformation path and demonstrated the prepared PPT on site. On the 26th, Qiang Huitao convened all middle-level managers for a meeting that lasted a full six hours. On the 27th, as the holiday began, Dunjie required all employees to copy the 36-page PPT to further understand the company's plan. On the fourth day of the Chinese New Year, all middle-level managers entered a state of combat readiness, implementing the planned direction and strategies, and detailing multiple plans from company structure, employee functions, software systems, and business processes. On the seventh day, the warehouse, picking, and distribution departments began renovating the warehouse, and Dunjie formally established a technical department in cooperation with Zhongke Shangruan. In March 2018, the countdown to transformation began. Qiang Huitao recalled, "The past March was red for Dunjie; everyone was fighting desperately. The procurement department, to adapt to the new system, went from uploading a single product in 2-3 minutes to 20-30 minutes, working overtime every day until late at night. The warehouse, picking, and distribution departments checked inventory daily, studied how to improve picking speed, and when they found that installing shelves could improve efficiency, they immediately planned zones, installed, and renovated, staying up all night..." Qiang Huitao told New Distribution, "Although Dunjie trained every day at that time, we knew training alone wasn't enough. For the team, this was something they had never done; having only theoretical knowledge without practical experience was useless. Dunjie had to grit its teeth and force the ducks onto the perch, firing first then aiming, jumping into the water to test its depth." Thus, on March 12, the Dunjie platform officially went live, and the gunshot of transformation officially sounded...

03 Platform Launched for 1 Month, Sales Dropped 50% Excitement and chaos—these two words can describe the scene on Dunjie's first day online. Qiang Huitao recalled that 80 merchandisers were frantically opening stores in the market. They thought two auditors would be enough, but the number of store audits increased from 1 to 10 to 30 to 100 to 200... without a moment's rest, and two people couldn't keep up. At 10 a.m., the technical department increased to 15 auditors, and by the afternoon it exploded; bandwidth was insufficient, and photo data couldn't be downloaded. On March 12, Dunjie completed the onboarding of 500 outlets. On the other side, the warehouse, picking, and distribution departments had changed the outbound method to improve shipping efficiency, but goods couldn't come out, and a series of problems like shortages, wrong items, and missed items erupted. Salespeople were so anxious they cursed, and business supervisors were hopping mad... By the second day, the excitement was gone, and the chaos was just beginning. Qiang Huitao told New Distribution, "In the past, we were secondary distributors, and even if problems arose, we turned a blind eye. Now with a unified input-output platform, all old and new problems exploded. Inter-departmental buck-passing and disputes were endless: procurement blamed the warehouse, the warehouse blamed the drivers, and no one wanted to take responsibility... Salespeople who couldn't bear the pressure also resigned. Besides internal process chaos, there was also the warehouse picking and distribution process, which went through four different outbound methods, and the error rate initially reached 100%." Within a month, Dunjie's sales plummeted by 50%.

04 Sales Recover, Review and Summarize Qiang Huitao told New Distribution that it wasn't until mid-April that the company's overall business processes, departmental collaboration, and system operations began to ease. Subsequently, sales began to steadily recover. Dunjie currently handles about 400,000 yuan in daily orders and processes around 500 orders per day. The quality of execution depends not on the top or bottom, but on the middle management. Qiang Huitao said, "We have survived the hardest period. Currently, we are conducting a comprehensive review, filling gaps, and fixing leaks. Middle managers have a short meeting every day at noon to solve issues from that day and the previous day, and a big meeting every Saturday to review the week's business processes, standardize systems, and tackle core issues." △ Dunjie's three core business philosophies established after the phoenix nirvana Qiang Huitao stated that Dunjie will strive to resolve all current problems one by one before June 30. They will thoroughly review warehouse distribution efficiency, product structure, organizational framework, and organizational processes. After that, Dunjie will continue to expand outlet coverage, density, and classification, and do a good job in user operations. Currently, Dunjie is constrained by warehouse software and hardware issues and dares not add new outlets. It plans to add an 8,000m² warehouse in June, and another by the end of the year, with three warehouses forming a triangle covering the entire Shijiazhuang market. In terms of extending downstream, Dunjie has already opened 101 franchise stores so far. Later, Dunjie will establish a convenience store management company to continue accelerating the pace of store rebranding.

Final Thoughts The above is the transformation case of Dunjie in Shijiazhuang, Hebei. In the view of New Distribution, Dunjie's transformation journey has been full of ups and downs: from the initial company-wide training, ideological implementation, and excitement, to the sharp sales decline and concentrated outbreak of problems during the transformation, hitting rock bottom, and then to the current steady sales recovery, adjustment and optimization, and regained confidence. Dunjie took nearly six months to complete a metamorphosis journey. Previously, New Distribution has expressed that the transformation of trading enterprises is a top leader's project. Dunjie's case also tells us that transformation is not only a top leader's project but also a company-wide project. It's not enough for just the boss to know about the transformation; employees must also be involved. The reason Dunjie was able to switch quickly and recover and stabilize after the painful period, in New Distribution's view, lies in the unity of thought across the entire company. From the training and exams during the preparation period, to the daily short meetings and weekly big meetings during the transformation, and later to opening equity to employees, employees have fundamentally changed their thinking from cognitive transformation, implementation transformation, to active transformation. This is the fundamental guarantee for Dunjie's successful transformation. Due to space limitations, more practical experience from Dunjie's transformation will be shared by Qiang Huitao in New Distribution's public classes and the New Distribution Dealer Transformation Group. Add the author's WeChat for real-name authentication to apply for group membership. Stay tuned for more exciting reports. -END-