--- title: "Hema Reports Nine Consecutive Months of Profitability: How Does the New CEO Score?" description: "Starting from the first half of 2024, Hema has embarked on a new development model under a revised strategic direction. This adjustment has proven correct, as Hema now appears more stable and focused on operational efficiency. In March 2024, Yan Xiaolei, former CFO, succeeded founder Hou Yi as CEO, signaling a shift toward steady growth. Her annual report card includes nine months of profitability and double-digit growth, but challenges remain in competition and supply chain development." author: "联商网编辑部" publisher: "New Distribution" email: "zhaobo258@gmail.com" telephone: "+8615854817671" published: "2025-01-16" language: "en" canonical: "https://xinjignxiao.com/en/articles/hema-reports-nine-consecutive-months-of-profitability-how-does-the-new-c-5c9ec556/" markdown: "https://xinjignxiao.com/en/articles/hema-reports-nine-consecutive-months-of-profitability-how-does-the-new-c-5c9ec556.md" original_source: "https://mp.weixin.qq.com/s/jzaCNj3218KX27fqC-Bo7A" translation: "https://xinjignxiao.com/zh/articles/%E7%9B%92%E9%A9%AC%E8%BF%9E%E7%BB%AD9%E4%B8%AA%E6%9C%88%E7%9B%88%E5%88%A9-%E6%96%B0%E4%BB%BBceo%E8%83%BD%E6%89%93%E5%87%A0%E5%88%86-5c9ec556.md" attribution: "New Distribution — https://xinjignxiao.com/en/articles/hema-reports-nine-consecutive-months-of-profitability-how-does-the-new-c-5c9ec556/" usage_policy: "https://xinjignxiao.com/ai-policy.txt" --- # Hema Reports Nine Consecutive Months of Profitability: How Does the New CEO Score? > Starting from the first half of 2024, Hema has embarked on a new development model under a revised strategic direction. This adjustment has proven correct, as Hema now appears more stable and focused on operational efficiency. In March 2024, Yan Xiaolei, former CFO, succeeded founder Hou Yi as CEO, signaling a shift toward steady growth. Her annual report card includes nine months of profitability and double-digit growth, but challenges remain in competition and supply chain development. Starting from the first half of 2024, Hema has embarked on a new development model under a revised strategic direction. In hindsight, this adjustment has proven correct for Hema. Compared to the past, when Hema was constantly changing and generating buzz, the current Hema appears more stable and focused on operational efficiency. A more confident Hema, fully aware of its existing strengths, is gradually emerging. In March 2024, Yan Xiaolei, who previously served as Hema's CFO, succeeded founder Hou Yi as the new CEO. Yan's financial background led outsiders to view her appointment as a turning point for Hema's pursuit of steady development. Alibaba CEO Wu Yongming praised Yan: "Having joined Hema for six years, she has keen business insight and is very familiar with the company from business to team." With nearly a year of new policies, how would Yan Xiaolei's annual report card score? **Three Things Hema Did Last Year** On December 31, 2024, Yan Xiaolei released an upbeat internal letter. At the outset, she announced to all employees that Hema had achieved double-digit growth on the basis of nine consecutive months of overall profitability. This statement is significant: first, nine consecutive months of profitability exactly matches the period since she took over as CEO. Additionally, the double-digit growth figure was not specified, nor whether it referred to GMV, revenue, or profit. In the letter, Yan highlighted three major initiatives: returning to user value, focusing on development direction, and advancing organizational building. From a public interpretation perspective, this letter reads more like a manifesto of her policy strategy than a simple internal communication. Regarding returning to user value, Yan expressed it in two dimensions: first, nearly half of Hema Fresh stores nationwide underwent upgrades to improve hardware facilities; second, product innovation focused on "health" and "convenience." Focusing on development direction was interpreted as opening new stores. Within Yan's framework, Hema focuses on two store formats: Hema Fresh and Hema NB. In 2024, Hema opened a new store every five days on average, entering 21 new cities. Calculated over nine months, Yan's 270 days in office saw approximately 54 new stores. Hema Fresh is the main store format, while Hema NB remains in the "polishing the optimal model" phase. Advancing organizational building essentially means providing promotion and salary increase opportunities for employees. Yan stated that nearly 200 new store managers were added last year, 10% of procurement staff were promoted to category manager roles, and the store manager grade and compensation reform has been completed. Overall, Yan's internal letter offers a glimpse of the bigger picture, serving as a rough "summary report" of Hema's past year under new leadership. This report only provides macro-level directional adjustments and key focus areas, but in reality, the capital market and public opinion, which pay close attention to Hema, may want to see more about Hema's future plans. Especially against the backdrop of intense competition in high-quality fresh retail, what competitive strategy will Hema adopt? **Has Hema Turned the Corner?** In fiscal year 2024, Hema's overall GMV exceeded 59 billion yuan, up from 55 billion yuan in the previous fiscal year, with online transactions contributing over 63%, and offline GMV also growing. Coupled with Yan's high-profile announcement of "double-digit growth on the basis of nine consecutive months of overall profitability," some media believe Hema has turned the corner. In August of this year, Yan set a new goal for Hema: **to exceed 100 billion yuan in GMV within three years, a 69% increase from 2023**. She stated that by then, Hema would become one of the top two retailers in China. If Hema can truly achieve a hundred-billion GMV, that scale would be equivalent to current Sam's Club. Retail self-media "Commercial Observer" cited market sources saying that in 2024, Sam's Club's full-channel sales in China exceeded 100 billion yuan, reaching 100.5 billion yuan. Will Hema in three years grow into today's Sam's Club? It is still too early to judge, and Hema still has much to work on. From the perspective of store format selection and focus, Yan Xiaolei is undoubtedly wise. Since its inception, Hema has tried more than a dozen formats, including Hema Fresh, Hema X Membership Store, Hema Neighborhood, Hema Mini Station, Hema MINI, and Hema Fresh Outlets. After taking over, Yan clearly engaged in deep reflection and repositioning, deciding to focus on Hema Fresh main stores and Hema NB. According to industry insider feedback, Hema NB's reputation is rising, and its "double 15" business model is increasingly praised. Currently, Hema has nearly 430 stores nationwide. According to internal disclosures, in 2024, it opened a new store every five days on average, the fastest pace in five years. Since Hema's single-store scale is relatively small compared to traditional supermarkets, Hema is essentially more like a community store. With the current 430 stores, there is still room for growth in overall performance. In my view, Hema's main stores need to accelerate expansion, capture market share, and strengthen their position in the minds of target consumers as **the first platform for domestic high-quality selected fresh retail**. Additionally, Yan's policy outline did not mention another crucial aspect: supply chain construction. As a high-quality food retailer, the supply chain is the backbone that supports Hema. On one hand, a carefully selected supply chain ensures product quality; on the other hand, strong supply chain relationships can effectively control costs and enhance competitive advantage. Information shows that in 2023, Hema initiated a series of reforms, focusing on building a vertical supply chain and increasing efforts on private label brands. Products like Hema Organic, Daily Fresh, and Hema Workshop have increased, and a bakery factory was established in Kunshan, Suzhou. At the same time, Hema Fresh began optimizing in-store SKUs. Building a supply chain and developing private labels ensures product quality, lowers prices, and makes Hema more price-competitive. As early as a few years ago, Hema internally proposed the idea of "**seeking traffic from products**." **Who Should Hema Benchmark Against?** Benchmarking means identifying a model to learn from at the current stage and an entity to become in the future. Who Hema needs to learn from now and who it wants to become in the future depends on what kind of "high-quality retail platform" integrating online and offline the broad young middle-class consumer group needs. **Here, high quality means high fidelity in product quality and high integrity and reliability in service.** As high-quality consumers increasingly demand safe and reliable domestic food quality, fresh retail positioned at mid-to-high-end like Hema clearly has an extremely broad "mass base." However, forming such strong recognition and widespread reputation is not easy. For consumers, is Hema currently the best offline retail brand in China? To answer this question, from a horizontal competitive perspective, almost everyone will involuntarily compare it with Sam's Club and Pangdonglai. Clearly, among domestic retailers, Pangdonglai is currently the unique "high-quality representative," not only in service but also in product quality control. At the industry level, from 2023 to 2024, most players in the fresh food track raised the banner of price wars. Dingdong Maicai, Xiaoxiang Supermarket, JD Seven Fresh, and others began actively adjusting strategies. At the end of November 2024, JD Seven Fresh sparked a new round of price wars in the instant retail industry, with multiple "breakthrough price" products breaking Hema's "no need to compare, truly save" prices, and Xiaoxiang Supermarket subsequently matched prices on several JD Seven Fresh products. For Hema itself, especially before 2024, strategic adjustments were frequent, such as reports of abandoning the membership system. Based on its positioning for high-quality consumers and mid-to-high-end, Hema's advantage lies in quality, and it should not fall into the quagmire of low prices. To build a moat, Hema hopes to launch a large number of differentiated store formats alongside main stores to differentiate in product prices. In the new year, Hema should continue to focus and concentrate resources on refined operations. **From the current perspective, Hema's strategic adjustment is undoubtedly correct, but it faces enormous competition**. With Aldi, Sam's Club, Costco, and others advancing rapidly, market competition will become even more intense. Sam's Club has a strong international background; from another dimension, Pangdonglai may be the most appropriate model for Hema to learn from. Regardless of future strategic choices, comparing the present with the past, Yan Xiaolei's annual report card for Hema in 2024 deserves an excellent score. What do you think? **【New Order · Symbiosis】** **The 10th China FMCG Innovation Conference** **Time: March 17-19, 2025** **Location: Chengdu, China** --- ## Copyright and AI use This article is sourced from New Distribution. 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