---
title: "Fresh Century: How This FMCG B2B Platform Secured Two Rounds of Funding in Four Months During the Capital Winter"
description: "Fresh Century, a Shanghai-based FMCG B2B platform, has secured two rounds of funding in just four months, standing out in the capital winter. Its founder, Liao Chuan, attributes this success to a relentless focus on supply chain efficiency, which he believes is the core value that many B2B platforms overlook."
author: "新经销刘少德"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2018-07-12"
language: "en"
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# Fresh Century: How This FMCG B2B Platform Secured Two Rounds of Funding in Four Months During the Capital Winter

> Fresh Century, a Shanghai-based FMCG B2B platform, has secured two rounds of funding in just four months, standing out in the capital winter. Its founder, Liao Chuan, attributes this success to a relentless focus on supply chain efficiency, which he believes is the core value that many B2B platforms overlook.

1. From fresh food e-commerce to FMCG B2B: Why did he make this transition?
2. Two rounds of funding in four months: How did this B2B platform win investors' hearts?
3. Heavy investment in products, warehousing, and technology: What is the real value of the FMCG supply chain?

"**We are a pure supply chain company**."

Liao Chuan, founder of Fresh Century, describes his startup in these terms. In his view, most B2B platforms do not respect the value of the supply chain, blindly extending beyond it. Fresh Century, however, has always believed that the core of any extension is supply chain efficiency, so it focuses its business scope on reducing costs and increasing efficiency in the supply chain. Compared with other B2B platforms, this business model is clearly not very "sexy."

Yet this seemingly unsexy company has outperformed national internet companies like JD New Channel and Yijiupi, ranking first in comprehensive competitiveness in Shanghai's FMCG B2B market, and has secured two rounds of substantial funding in just four months. So, what makes Fresh Century stand out?

1
**From Fresh Food E-commerce to FMCG B2B**

Founded in 2015, Fresh Century is an FMCG B2B platform based in Shanghai, radiating to the East China region. To date, it covers five cities: Shanghai, Suzhou, Ningbo, Wuxi, and Hangzhou, with over 20,000 users. Its product range includes beverages, snacks, daily chemicals, rice, flour, oil, fresh food, and seasonings, with over 5,000 SKUs.

However, Fresh Century's entrepreneurial journey has not been smooth sailing.

Before founding Fresh Century, Liao Chuan served as Technical Director at Yihaodian, CTO at Putian.com, and CTO at Benlai Life. Years of experience in e-commerce made him well-versed in e-commerce operations, but also led him to question: Is e-commerce really more efficient than offline wholesale markets? In Liao's view, the answer is no. "**After all these years, we've found that in FMCG and fresh food, B2C is not more efficient than offline physical stores.**"

Since offline stores are more efficient than e-commerce, convenience stores must have huge opportunities. In this context, Liao had two options: open his own stores or serve convenience stores. He chose the latter, because, first, the foundation of opening stores is an efficient supply chain, and second, his previous industry experience made him familiar with fresh food and FMCG warehousing and distribution.

In June 2015, the Fresh Century project was officially launched. Initially, Liao used fresh food as an entry point, aiming to solve problems in the traditional fresh food supply chain, such as unstable prices, inconvenient management, and untimely logistics.

However, as the market developed rapidly, challenges such as the difficulty of cultivating users for fresh food products emerged. "**Not all customers sell fresh food, and many stores do not have the conditions to sell fresh food.**"

In this situation, transformation became an unavoidable topic for Fresh Century. Liao then turned his attention to the traditional FMCG sector, intending to simplify the procurement levels of traditional FMCG through an information-based backend system, thereby serving and empowering traditional retail stores.

Based on the comprehensive supply chain system already built during the fresh food B2B phase, after expanding to all categories, Fresh Century's orders finally saw explosive growth, with daily order amounts reaching several million yuan. Since then, Fresh Century has entered a period of rapid business development.

2
**Two Rounds of Funding in Four Months: What Makes Fresh Century Deserving?**

It is common for FMCG B2B companies to extend downstream to retail by leveraging their supply chain advantages, with typical examples including Zhongshang Huimin's Haijia Convenience and Bestore's Best Neighbor. Fresh Century, however, has always focused its development on the supply chain, believing that the essence of franchise chains is supply chain efficiency. With an efficient supply chain, franchise convenience stores naturally follow, which constitutes a major difference from other B2B platforms.

"**The internet certainly has advantages over traditional existing channels, and B2B's advantage over traditional supply chains lies in the intensive advantages of centralized procurement and distribution.**" In Liao's view, the advantages of B2B over traditional wholesalers are mainly reflected in the following aspects:

> 1. **Scale advantages in categories**: The more products a platform operates, the more reasonable the product mix, the greater the gross margin space, and the higher the fulfillment efficiency per order. At the same time, terminal stickiness increases.
>
> 2. **Scale advantages in procurement**: The larger the quantity of products purchased, the more obvious the cost advantage.
>
> 3. **Scale advantages in warehousing and distribution**: The higher the average order value and capital density, the lower the warehousing and distribution cost per order.

"**Supply chain is an extremely trivial and detail-oriented process. Every link requires strict control over details. Only by doing details well can you possibly be more efficient overall than others. Traditional wholesalers can still survive, and even be more efficient than some B2B platforms, because they are really strong in detail control. What B2B needs to do is to reasonably avoid its own disadvantages.**"

Liao believes that most B2B platforms' original intention for convenience stores may be more about corporate revenue and platform valuation, but the supply chain itself can achieve profitability. Fresh Century's current warehousing and distribution cost is controlled at around 5 percentage points, far below the industry average, and could drop to 4 percentage points in the future.

In addition, Fresh Century's warehousing and logistics have fully implemented PDA informatization. Each employee can be managed by the system and "get more for doing more," which increases employee motivation and reduces the cost of coordination in traditional warehouse management. Moreover, operations personnel adopt a node responsibility model, so training costs are low, and they can become familiar with operations in just a few hours. Currently, each person can pick 800 items per day, and inventory turnover days are around 7.2 days.

On the logistics front, Fresh Century has over a hundred cooperating vehicles. After the transport vehicles go online, they can connect the entire logistics process through the map-based order allocation system, logistics handover system, and logistics evaluation system, achieving high timeliness. Orders placed before 12 noon can be delivered the same day, and orders after 12 noon are delivered the next day.

3
**What Is the Real Value of the FMCG Supply Chain?**

In the internet industry, which pursues speed, many companies make scale their primary goal. In this context, crazy burning of money for subsidies and market expansion is common. Unlike some platforms that blindly pursue development speed and national coverage, Fresh Century insists on basing itself in Shanghai and gradually expanding to surrounding areas.

"**The greatest value of B2B is scale efficiency.**" In Liao's view, the core to judging whether a company's development model is correct is whether it generates scale benefits. "**There are only two reasons why a platform does not generate scale benefits: first, the market expands too fast, so the market share in a single market is very small; second, the control of supply chain details is still relatively rough, and continuous investment cannot bring output.**" Fresh Century's greatest advantage comes from the efficiency improvements brought by its investment in technology and detail control.

Since the development of the FMCG B2B industry, it has become a consensus that only refined operations can maximize efficiency. Companies like Fresh Century, which invest huge human and material costs in technology to connect procurement, warehousing, logistics, and other links through technology, and achieve strict control over the entire FMCG circulation chain, can truly improve industry efficiency in essence.

After the early stage of industry land grabbing, FMCG has officially entered a deep-water period of development. As the industry as a whole faces a cold capital market, the ability to control processes and details will truly become the core competitiveness of B2B platforms.

Editor's note: **Liao Chuan, founder of Fresh Century**, will attend the FDIC 2018 China FMCG Digital Innovation Conference held by New Distribution in Shanghai from August 22 to 24, where he will share more pioneering insights. Interested friends should not miss this conference.

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