When e-commerce first set foot in the Chinese market, the phrase 'channels are dead' startled all distributors, making it seem as if the entire industry had entered an era of comprehensive decline. Now, as 'Internet+' has risen to a national strategy, Internet B2B platforms have emerged and developed rapidly, and the 'disintermediation' business model has further weakened the confidence of distributors. Anxious distributors are constantly worried that 'Internet B2B will carve up their market and take their share of the pie'...
The Rise of Internet B2B: Traditional Distributors Panic
In recent years, with the deepening of Internet thinking, various B2B platforms have developed vigorously, and traditional distributors in all industries, the 'old hands,' feel threatened. There is no denying that the rise of Internet marketing has dealt a huge, even fatal, blow to traditional distributors.
For traditional distributors, the arrival of Internet B2B platforms has accelerated the flow of information, made price information more transparent, and made purchasing channels more convenient. Platforms bypass distributors and can directly access customer needs, abandoning the traditional business model that relied on information asymmetry in pricing and logistics.
Suddenly, they don't know where to go; this time they are truly panicked!
How Can Traditional Food Suppliers Break Through Amidst the Transformation of the Catering Supply Chain?
Inevitably, the rise of B2B platforms has also impacted traditional food suppliers (such as condiment suppliers and fresh food suppliers), and the catering ingredients procurement field is undergoing significant changes. With the deepening integration of the Internet economy and the real economy, the integration of the Internet with traditional catering enterprises is inevitable. The entire catering industry is quietly undergoing a 'Internet era' industrial chain revolution, and the catering supply chain has become a new hotspot for market segmentation. With the steady development of the B2B market, the 'Internet + catering' B2B platform business model has emerged. The trillion-yuan catering ingredients procurement market has become a breeding ground for the rapid growth of catering B2B platforms. As the catering B2B market grows, similar catering procurement Internet platforms have quickly emerged, and the catering supply chain has undergone tremendous changes in the Internet era. Traditional ingredients procurement models have been replaced by Internet procurement platforms due to many drawbacks, and as an important part of the traditional procurement chain, traditional food suppliers are facing difficulties.
In the Internet era, the catering supply chain has undergone tremendous changes. How can traditional food suppliers break through?
First, from the perspective of traditional food procurement suppliers, analyze the pressure that traditional food procurement places on them, identify the pain points, and then prescribe the right remedies.
1. Unstable sales staff, rising labor costs
2. Excessive capital occupation, high pressure from payment terms
3. Outdated traditional supply models, lack of systems, wasting manpower and resources
4. Difficult market development, intense competition, severe counterfeiting, and shrinking profit margins
It is precisely because the traditional food procurement model has many such disadvantages that traditional procurement suppliers find it difficult to adapt to changes in the external environment. History moves forward, and traditional procurement models will inevitably be replaced by new models.
E-commerce platforms, with their strong advantages—rich product variety, nationwide logistics, and low prices—are seizing the market of traditional procurement distributors, exposing the drawbacks of traditional procurement asymmetry. A large number of orders are quietly flowing to Internet platforms.
Furthermore, as the front end of the food procurement chain—small and medium-sized restaurants and hotels—are troubled by the traditional food procurement model, they are turning to online platforms. What reasons drive them to abandon traditional food procurement and adopt platforms?
1. Market prices, price stacking from middlemen, information blockage and asymmetry, and opaque procurement prices
2. Small procurement volumes, no bargaining power, and inability to quickly compare prices
3. Disorganized and unsystematic procurement, making traditional procurement time-consuming and labor-intensive
4. Food safety cannot be traced, and gray income is difficult to eliminate
When the drawbacks of traditional procurement models are exposed and cannot bring more profit space to suppliers, and when the Internet drives changes in consumption patterns, small and medium-sized restaurants and hotels also turn to platforms. Traditional food suppliers, however, still linger outside the B2B door. In today's Internet-dominated society, this is tantamount to seeking self-destruction.
For traditional food procurement suppliers, the way to break through is to change their mindset, embrace the Internet, follow its footsteps, turn Internet B2B from an enemy into a friend, and move forward hand in hand. When you choose to embrace the Internet, you will discover the infinite possibilities it brings, and you will find that there is light at the end of the tunnel.
Tongying Tianxia, a vertical e-commerce platform that only deals in catering ingredients, limits its business scope to ingredients needed for three meals a day. In September 2014, Tongying Tianxia launched the Tongying Youcai catering ingredients procurement platform. The platform has national upstream and downstream supply chain resources and business association resources in the catering industry. Its key strategic partners and city partners are all suppliers with 5-10 years of experience in catering industry supply.
Tongying Youcai follows the trend, builds a one-stop procurement platform for restaurants and hotels, relies on big data analysis to achieve precise market positioning, gathers the most consumption-potential restaurant and hotel buyers, and reserves sufficient customer resources for food procurement suppliers. It helps traditional food suppliers quickly complete transformation and connect with the Internet, allowing many food suppliers (condiment suppliers, fresh food suppliers) to move from offline to online, from behind the scenes to the forefront, leveraging the platform's advantages to fully utilize suppliers' original strengths and ultimately achieve profitability. Tongying Youcai strives to share the best entry points to the most profitable markets with fellow food suppliers, achieving win-win cooperation.
Tongying Youcai adopts a supplier franchise model, allowing suppliers to join as regional sub-centers of Tongying Youcai, which effectively expands the company's visibility and business scope. During operations, Tongying Youcai focuses on brand building and promotion, with Internet thinking throughout.
After more than two years of growth, Tongying Youcai's catering procurement platform has successively held project launch sharing sessions in more than 100 cities across the country. As of the end of July, the platform's provincial business divisions have been deployed in nearly 12 provinces, helping many distributors successfully transform to the Internet. There are nearly 70 city partners nationwide, and the total number of registered restaurants and hotels is 66,378.
Tongying Youcai integrates traditional supply chain resources, facilitates transactions between supply and demand, and provides help in solving problems in catering procurement, reducing procurement costs for catering enterprises, making transaction processes transparent, ensuring food safety, and breaking through the limitations of the traditional catering ingredients supply chain. From the perspective of the platform's long-term development and strategic layout, 'matching' and 'self-operated' need to be integrated: 'matching' quickly accumulates users and transaction volume to expand market share, while 'self-operated' controls service quality and obtains higher profit income. Tongying Youcai embeds the heavy-asset operation plan in its corporate strategy, accumulating strength to achieve a complete closed-loop ecosystem.
After more than a year of mature operation, Tongying Youcai's platform has found that whether from the perspective of the huge supply and demand on both sides or the considerable profit prospects, the self-operated model centered on terminal group buying and collective procurement will become the next focus of Tongying Youcai. By strengthening its self-operated business and breaking the 'industry rule' of burning money through financing, Tongying Youcai's ultimate goal is to achieve self-sufficiency and self-development.
Therefore, choosing the right platform can enable the majority of suppliers to truly embrace the Internet and achieve cross-border upgrades for participants in the food supply chain. In that case, Internet B2B will not take the suppliers' cake but will provide them with cheese.
For food suppliers who want to learn more about Tongying Youcai's city partner model and transform to the Internet, please scan the QR code in the image for consultation: