---
title: "Exclusive | Monthly GMV 370 Million Yuan: Decoding the Underlying Logic of Xingsheng Youxuan!"
description: "This article reveals the underlying logic of Xingsheng Youxuan, a leading community group-buying platform in China, which achieved a monthly GMV of 370 million yuan. Through interviews with its founders and analysis by the author, it explores the company's supply chain efficiency revolution, user experience focus, and simple, pragmatic culture, positioning it as a key player in China's third retail pole."
author: "任小东"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2019-02-28"
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# Exclusive | Monthly GMV 370 Million Yuan: Decoding the Underlying Logic of Xingsheng Youxuan!

> This article reveals the underlying logic of Xingsheng Youxuan, a leading community group-buying platform in China, which achieved a monthly GMV of 370 million yuan. Through interviews with its founders and analysis by the author, it explores the company's supply chain efficiency revolution, user experience focus, and simple, pragmatic culture, positioning it as a key player in China's third retail pole.

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> Scenario 1: During the 2018 Spring Festival, I returned to my hometown, Gaofang Village, Chuanshan Town, Miluo, Hunan, a small fifth- or sixth-tier village in southern China. Coinciding with my cousin's wedding, I helped prepare for the pre-wedding banquet, mainly purchasing fresh produce. Previously, this meant going to the town market. That day, my cousin took out his phone and opened the Xingsheng Youxuan mini-program...
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> Scenario 2: During the Spring Festival holiday, I visited many community vegetable markets in Changsha. Many stall owners explicitly told me that in 2018, they were greatly affected by community group-buying companies and planned to quit this business next year. One stall owner calculated: a couple, going to the Haijixing wholesale market after midnight every day, with no rest days, working all year, previously earned 20,000 yuan a month, but now less than 10,000. They might as well join some community group-buying platforms as group leaders...
From 2017 to 2018, I have been dedicated to researching the S2B2C model. I have published multiple articles and industry reports on B2B e-commerce and community e-commerce models. New Distribution also took the lead in judging that community e-commerce is China's third retail pole. Unexpectedly, the penetration of community e-commerce and its impact on lifestyles has been so rapid.
As the birthplace of community group-buying—Changsha—there is a company that first did community group-buying, called Xingsheng Youxuan. What kind of company is this?
> First impression: such a man—very silly and naive, very fierce and persistent.
This is a very strange enterprise.
Low-key, almost abnormally low-key.
Pragmatic, extremely solid and pragmatic.
Rarely see reports, materials, or speeches about its enterprise. Founder Yue Lihua, from Yiyang, Hunan, rarely accepts external interviews. I have had the honor of meeting President Yue a few times; he is extremely low-key, calm, and gentle in tone. He is not aggressive, and can even be described as "not good at words."
However, this enterprise's market attacks are exceptionally fierce. The B2B e-commerce module, Abida platform, has covered more than 80 prefecture-level cities and 200 county-level cities in 16 provinces and municipalities, including Hunan, Guangdong, Hubei, Jiangxi, Zhejiang, Jiangsu, Anhui, Chongqing, Sichuan, Beijing, Tianjin, Hebei, Fujian, Shaanxi, Shanghai, and Guangxi.
The B2B logistics and distribution service network covers five levels: province, city, district/county, township, and village (community). Its Furong Xingsheng franchise stores have reached more than 13,000, with annual sales exceeding 3 billion yuan. Nationwide, only Dongguan's Meiyijia can be considered a rival.
In the community e-commerce module, Xingsheng Youxuan currently has monthly sales close to 370 million yuan, with more than 3,000 employees, covering over a hundred cities. Co-founder and President Zhou Yingjie told me, "Basically, there is no promotion; it's entirely the brand reputation accumulated by Xingsheng and the word-of-mouth spread among group leaders who have made money."
With such speed, it is basically leaving others in the dust in the community e-commerce field! According to my interviews with one of Xingsheng's shareholders, President Chen, co-founder and President Zhou Yingjie, and co-founder Liu Yuhui, everyone says this is attributed to the founder Yue Lihua's original intention and forward-looking judgment.
The low-key culture and the soaring performance create a strong sense of conflict!
I can only say, this is perhaps: very silly and naive, very fierce and persistent.
When will you come out and share Xingsheng's experience? Zhou Yingjie, co-founder and president of Xingsheng, said, "Wait until we reach 10 billion!"
> Back to the original intention: "Empower upstream, revive stores, change consumer lifestyles."
New Distribution interviewed a circle of community group-buying platforms. In February, I visited Xingsheng Youxuan and had a two-hour in-depth exchange with President Zhou Yingjie and co-founder Liu Yuhui.
Below are the viewpoints and remarks that I found very valuable after the interview, excerpted:
01 **Supply Chain Efficiency Revolution**
"Whether it's B2B or community e-commerce, it's essentially a supply chain efficiency revolution," said President Liu Yuhui.
This supply chain efficiency revolution is based on the upgrading of consumer demand.
First, consumers, as customers and individual entrepreneurs, need better stores that can make more money as business entities. So we do community e-commerce as a model to empower stores, with the mission of reviving stores.
Second, consumers, as the main body of community consumption, need high-quality, low-price goods to improve their living standards. With new lifestyles, consumers "hire" community e-commerce platforms to satisfy their desire and demand for new lifestyles, giving them an ultimate experience.
**Ren Xiaodong's Interpretation:**
1. From the perspective of supply chain efficiency revolution, China's current community e-commerce is basically an S2B2C model.
2. Only by deeply understanding Chinese consumers' current consumption habits and consumption stratification can we do community e-commerce well:
  * 1) The shopping habits cultivated by "group buying," takeout habits, mobile ordering habits, and the increasingly cultivated demand for "see what you get" faster and better, etc., constitute the "consumer subculture" of the new era, nourishing the new model of community e-commerce.
  * 2) After consumption stratification, Chinese consumers, both outside and inside the Fifth Ring Road, need high-quality, low-price goods. Through the three "pleasure points" of "high frequency, high experience, and ultra-low prices after group buying," consumers become addicted to shopping, replacing their previous consumption habits of going to professional category stores and wholesale markets.
  * 3) With China's Engel coefficient dropping to a historical low of 23%, following the experience of Japan and Taiwan, the convenience store format has developed from mom-and-pop stores—loose franchise stores—close franchise stores—renovated franchise stores. Convenience stores have become platforms for community convenience life services. However, China's community convenience life service platform may not follow the Japanese route but will develop into an O2O model like community e-commerce. Xingsheng Youxuan's sister company is the Xingsheng Abida B2B ordering platform, with annual GMV exceeding 3 billion yuan, covering more than 16,000 stores. All this has prepared sufficient traffic entry points and supply chain management experience for Xingsheng Youxuan.
**In summary, new retail is more efficient retail. And more efficient retail comes from the redesign of people, goods, and places.**
**Without the digital optimization of the entire supply chain (from design—factory—middleman—retailer—consumer), reducing links to integrated production and sales, the community e-commerce model would not be possible.**
02 **User Experience**
"Our system UI design is not the most beautiful in the industry, but it is the most user-friendly."
Why? "Because this system was made after I and President Liu stayed at stores for several months, communicating with store owners," explained President Zhou Yingjie.
In terms of products, services, systems, and teams, we repeatedly emphasize user experience and the warmth of users.
Why can Xingsheng Youxuan attract a large number of group leaders purely by word-of-mouth without promotion in many cities?
Xingsheng never uses third-party logistics, mainly because they are afraid that poor customer experience will affect the delivery of goods. Using third-party companies is doomed to fail. It will increase the cost of customer fulfillment.
We have one to two hundred technical personnel to ensure system iteration and upgrades; we do not use SaaS software.
**Ren Xiaodong's Interpretation:**
What is the correct operational strategy for a company?
It does not come from capital's pointing fingers, nor from "experts'" suggestions based on individual experience, but from insight into the front line, reading consumers, reading customers, and focusing on end-user needs to discover value points that need to be "strengthened, increased, ignored, or not thought of." It could be a button setting in a mini-program, page jump design, or product selection, warehousing, secondary sorting, and return handling.
I remember Mr. Wang Jun, a famous new retail expert, told me a story about returning home during the 2018 Spring Festival. The gist was that he saw a 4-5 tier town supermarket with hundreds of chain stores doing booming business. When he chatted with the boss, the boss told him, "We just don't sell overnight vegetables!" What? No overnight vegetables? The key is that they had been doing this for ten years, persisting until now, and business has become increasingly booming.
Returning to Xingsheng, there is a story circulating in the industry. It is said that Xingsheng's stores have their own purchasing rights. The purchasing department once wanted to take back this right and used various methods to force stores to only purchase from the Xingsheng platform. But founder Yue Lihua strangely made a decision: open up store purchasing rights, allow stores to compare prices, and force procurement to optimize the supply chain. As a result, Xingsheng's supply chain prices are the lowest in the industry, and procurement corruption has been eliminated.
Why do some community group-buying companies die? One reason is that the buyer system has become "corrupt." I have recently heard of several cases; I won't name names here.
03 **Simplicity and Extremeness**
Do not be constrained by capital's requirements for short-term data; focus on whether our operating methods bring user value.
Think more about things; we basically don't look at competitors or pay attention to them.
We don't like external communication, mainly because we still have many areas where we haven't done well; we need to study the company's shortcomings more.
We like doing things that change the world; Xingsheng Youxuan is a community e-commerce with warmth.
**Ren Xiaodong's Interpretation:**
There is an unverified anecdote that the famous investor Zhu Xiaohu was "kicked out" the first time he visited Xingsheng.
Simple, pragmatic, and low-key—from the senior management team to the grassroots staff, I have interviewed them all. Even its former employees are praised by a competitor as the best to work with. The style is mostly about thinking things through, innovating and reforming many supply chain management methods.
To accomplish something, you need immersion and a sense of control. Once you are immersed in the glitz and bustle, it's hard to produce results.
04 **What kind of team is this?**
From a capital perspective, the best way to measure whether a company is valuable is to look at data, model, and team.
The community e-commerce model represented by Xingsheng Youxuan has gained favor and investment from many dollar capital sources; in terms of data and model, it is already in the first tier, in a leading position.
The only thing is that the team is relatively mysterious.
Compared with the senior management teams of other domestic community group-buying platforms, who come from established internet companies and standard O2O companies like Alibaba, Tencent, and Aixianfeng, the backgrounds of Xingsheng Youxuan's several founders are more interesting.
They are not "pure" internet people; they are all compound entrepreneurial players who have experienced traditional enterprises + internet. This also fits the characteristics of the second half of the internet: traditional enterprises + internet.
In two years, through various explorations: home delivery business: failed, losing more than 20 million yuan, team disbanded, only a few people retained. In 2017, they started the store business with a pilot of 15 stores; by March 2018, more than 1,500 stores had joined community group-buying; in 2019, the team had 3,000 people, with monthly GMV of 370 million yuan.
After repeated failures and repeated attempts, they finally carved out a bright path. "Heaven helps those who help themselves; after all the hardships, the Qin dynasty finally belonged to Chu." The two co-founders joked with me: "We are still used to sleeping on the front line." "There are laughter and joy, and also ups and downs." "Being able to do something that changes society is quite fulfilling."
**Ren Xiaodong's Interpretation:**
On the road of entrepreneurship, it has nothing to do with your background or origin. It is related to your original intention, fighting spirit, mission, and cognition.
Entrepreneurship is about creating value, not following trends or TO VC. Xingsheng Youxuan and the Xingsheng team have handed in a beautiful answer.
In the internet circle, there are many Hunan people, such as Zhang Xiaolong, Tang Yan, Wang Xing, etc. I look forward to more internet enterprises from Hunan, such as Xingsheng Youxuan.
2019 is the first year of the second half of the internet, which is traditional enterprises + internet. I look forward to more enterprises changing and creating!
Xingsheng Youxuan has a vote in the camp of China's third retail pole!
New Distribution will hold the **2019 (5th) FMCG + Internet Conference** during the Chengdu Spring Sugar and Wine Fair from March 15 to March 18. This conference will focus on the topic of **"Breaking the Game"** , conducting in-depth discussions with many brand owners, supply chain service providers, distributors, and retailers.
Compared with previous conferences, this summit will be fully upgraded. In addition to the original topics such as **channel innovation, city distribution logistics, and distributor transformation** , it will add multiple parallel forums on **new marketing cases, IP + FMCG empowerment, community group-buying, and innovative retail** . Through three days of ten high-density, high-quality expert sharing and exchanges, we believe every brand owner and distributor can learn the latest business models, expert viewpoints, and practical methods, finding new tools and methods to break the game in 2019 and return to the track of high-speed growth.
Review of Previous Conferences
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