Four Years, 300 Million Invested, Obsessed with Convenience Store Supply Chain: How Does No.1 Life Achieve Its Goal of Not Leaving Guangdong Until 10 Billion in Sales?

Not only does it open convenience stores, but it also 'irrelevantly' opens supermarkets. Is this B2B platform, which claims 'no 10 billion, no leaving Guangdong; no 10,000 convenience stores, no national expansion,' just bragging or secretly preparing a big move?

In the movie 'Avengers: Infinity War,' Thanos snaps his fingers after collecting all six stones, seemingly effortlessly, but in reality, half of all life is wiped out, showcasing immense power. But movies are movies; in reality, transforming the trillion-yuan traditional FMCG retail market is not as simple as a snap, and market expansion is not just talk. And No.1 Life, which once claimed 'no 10 billion, no leaving Guangdong; no 10,000 convenience stores, no national expansion,' is it just seeking attention or secretly building up strength?

Recently, New Distribution exclusively interviewed Tan Xiaoping, founder of No.1 Life, to see how he plans to achieve the 10 billion sales target.

1 Accelerating Convenience Store Development, Expanding Quantity

China's traditional mom-and-pop stores are numerous and play a vital role in the trillion-yuan retail market, but they commonly suffer from low management levels and operational inefficiency.

No.1 Life's approach is to first establish connections with these traditional mom-and-pop stores through B2B, then select high-quality customers to invite for convenience store brand franchising. As of now, No.1 Life has nearly a thousand franchised convenience store outlets, growing rapidly at a rate of 150 stores per month. New Distribution analysis suggests the following reasons for such rapid franchise growth:

1. Supply Chain Foundation A well-established supply chain infrastructure can provide quality services to stores. To date, No.1 Life has established 18 central warehouses in Guangdong Province, each exceeding 3,000 square meters, essentially completing the warehousing and distribution network layout within the province. Thanks to convenient trunk logistics in Guangdong, goods can be quickly transferred between warehouses, reducing stockouts and shortages.

2. Easier Store Upgrades By supplying stores through the B2B platform, No.1 Life has built good relationships with them. Moreover, upgrades to No.1 Life convenience stores are based on existing quality store locations, eliminating the need for new site selection, thus reducing upgrade difficulty and significantly saving time and money.

3. Multi-Brand Strategy Through a multi-brand strategy, No.1 Life can cater to different customer preferences and needs; it also maximizes market coverage through brand combinations, reducing logistics costs and improving operational efficiency.

Currently, No.1 Life owns three franchise brands: Yundou Convenience, Duimi Mini Store, and Youmei Life, targeting traditional retail small stores, mid-end community stores, and small to medium supermarkets, respectively. Tan Xiaoping told New Distribution that in the future, they will expand the number of franchise brands to 10 through self-building or capital acquisitions.

2 Entering Supermarkets, Improving Product Mix, Building Warehousing and Distribution Network

Participants in the FMCG B2B industry can be categorized into three types based on company background and operational structure:

Native B2B platforms, originating from internet companies, expanding into FMCG supply chain, such as Zhongshang Huimin, Yijiupai, Zhanghe Tianxia, No.1 Life, etc.;

Retail B2B platforms, originally in chain or retail business, later leveraging existing supply chain advantages to enter FMCG B2B, typical examples include RT-Mart e-Lufa, Xingaoqiao, Meiyijia Caihua Commercial, Meitianbang Bianli, etc.;

Distributor-transformed B2B platforms, traditional distributors undergoing digital transformation, moving offline inventory online, typical examples include Dongbei Tao Daqing, Chengdu Rongcheng Yigou, etc.

From a revenue perspective, retail B2B platforms, with their supply chain foundation, can promote B2B business top-down with relatively lower warehousing and distribution investment, making profitability easier. Native B2B platforms, however, require substantial investment in warehousing, logistics, and supply chain, so the profit cycle is generally longer. Clearly, No.1 Life has recognized its shortcomings and found solutions.

Expanding Points, Filling Product Gaps

"We are currently preparing to acquire three supermarket companies with about 30 stores, each ranging from 500 to 1,000 square meters. In the future, we will acquire 5-7 more supermarket brands to achieve a total layout of nearly 100 supermarkets," Tan Xiaoping told New Distribution.

Currently, most B2B platforms focus on beverages, snacks, etc., as entry points. After completing its supermarket layout, No.1 Life can quickly fill gaps in B2B product offerings, especially in long-tail categories like daily chemicals, washing, grain, oil, and condiments, thereby gaining bargaining power with upstream suppliers.

Building Networks, Constructing Warehousing and Distribution Network

New Distribution learned that No.1 Life will continue to increase investment in warehousing, ultimately establishing a warehousing network in Guangdong Province consisting of 150 warehouses each over 3,000 square meters and multiple integrated front-store-back-warehouse systems over 10,000 square meters (5,000 square meters for supermarkets, the rest for warehousing).

This way, No.1 Life completes its strategic layout: convenience stores in cities, and warehousing plus supermarkets in surrounding counties. Additionally, with developed trunk logistics between cities in Guangdong, goods can be quickly transferred between warehouses and outlets via convenient transportation, further enhancing synergy between urban convenience stores, supermarkets, and warehouses.

3 Acquiring Cold Chain Company, Improving Gross Margin

The low management level and operational efficiency of traditional retail small stores are not only due to owners' subjective educational levels but also due to a lack of effective support from upstream supply. Categories like snacks, beverages, grain, oil, fresh produce, and frozen products have higher gross margins but shorter shelf lives and are not easily returnable, leading many store owners to focus on high-turnover beverages and alcohol as mainstream products, shying away from high-margin items. However, No.1 Life can eliminate store owners' concerns through its unique supply chain layout.

1. Dense network distribution. For slow-moving products, dense network distribution enables quick transfer between outlets and supermarkets, leveraging internal synergy for internal consumption.

2. Efficient warehousing and distribution system. Logistics distribution is like public transit, delivering products to stores rapidly and responding quickly.

At the same time, by supplying fresh food to terminal stores, No.1 Life successfully transforms stores from traditional convenience stores focused on snacks and beverages into community stores centered on grain, oil, fresh produce, and frozen products. This not only helps improve product mix, increase per-store output, and enhance franchise stickiness but also differentiates from convenience stores focused on beverages and alcohol, bringing scale advantages.

It is evident that No.1 Life's 10 billion sales target is not unfounded; its overall strategic path is already very clear. At the network level, using stores as branches and warehouses as trunks, with Guangdong's developed trunk logistics as connectors, it continuously strengthens layout and increases coverage density in Guangdong. At the product level, through acquiring supermarkets and cold chain companies, No.1 Life gradually fills long-tail product gaps and enhances its bargaining power with upstream suppliers, thereby improving overall gross margins across all product lines.

Channel transformation is a long evolutionary process. Deep distribution took nearly 20 years to develop and improve, and digital upgrading of channels cannot be achieved overnight. New Distribution has always believed that digitalization can improve efficiency across the FMCG industry, and problems in traditional distribution channels such as inefficiency and information opacity will inevitably be resolved with the development and popularization of information tools. The digital upgrade of channels is irreversible.

No.1 Life, based in Guangdong, continuously enriches and strengthens its product portfolio, deepens density, and taps into outlet value, gradually building its unique competitive barriers, which is worth learning from for industry practitioners. Recently, New Distribution will organize the 9th B-end E-commerce Study Tour to visit No.1 Life in Guangzhou. From traditional mom-and-pop stores to convenience stores, and then to supermarkets, what layouts has No.1 Life made? From point to line, and then to surface, how does No.1 Life achieve efficient collaborative operation among its internal systems? Welcome to sign up and explore the underlying logic behind No.1 Life's 'no 10 billion, no leaving Guangdong' with New Distribution.

Activity Schedule:

8th: Check in at designated hotel in Changsha; 9th: Visit Changsha Xingaoqiao; 10th: Visit Guangzhou No.1 Life; 11th: Visit Dongguan Caihua Commercial; 12th: Return or free arrangement for sightseeing;

Distributor friends interested in transformation are welcome to join us for understanding and on-site visits:

Organization Format 1. Company visit 2. Actual market case visit3. Warehouse visit 4. On-site explanation/one-on-one communication5. Salon training

Participating distributor friends only need to pay a 200 yuan registration fee Other expenses are self-covered Long press this QR code or click 'Read Original' to register

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Group photos from previous tours:

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Group photo of the 8th Japan New Retail Study Tour, from left to right: Japan AEON headquarters, sharing by store manager of Japan's fourth-largest convenience store MINISTOP, lecture on MUJI by Watanabe Ei, author of 'The Transformation of MUJI', and explanation of fresh produce + farm business model by Kyoto 800-1 Managing Director Hiroshi Tominaga.