---
title: "New Retail Is Not the Rebuilding of 'People, Goods, and Places', but the Rebuilding of 'Production, Supply, Wholesale, and Retail' Relations!"
description: "The competition among value chain members is superficially a conflict of interests, but in essence, it is a conflict of discourse power. The saying 'the shop bullies the customer, and the customer bullies the shop' is an eternal business principle. Although the concept of 'New Retail' was proposed as early as 2016, 2018 is the first year of New Retail. This year, various New Retail species began to gain momentum, traditional retailers started their New Retail transformation, and original retail formats also put on the New Retail hat. From manufacturers and brand owners to distributors and logistics providers..."
author: "苗庆显"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2018-11-29"
language: "en"
canonical: "https://xinjignxiao.com/en/articles/new-retail-is-not-the-rebuilding-of-people-goods-and-places-but-the-rebu-54006ff0/"
markdown: "https://xinjignxiao.com/en/articles/new-retail-is-not-the-rebuilding-of-people-goods-and-places-but-the-rebu-54006ff0.md"
original_source: "https://mp.weixin.qq.com/s/6AmcqPFdjq2lf8vRF9QYCg"
translation: "https://xinjignxiao.com/zh/articles/%E6%96%B0%E9%9B%B6%E5%94%AE%E4%B8%8D%E6%98%AF-%E4%BA%BA%E8%B4%A7%E5%9C%BA-%E7%9A%84%E9%87%8D%E5%BB%BA-%E8%80%8C%E6%98%AF-%E4%BA%A7%E4%BE%9B%E6%89%B9%E9%9B%B6-%E5%85%B3%E7%B3%BB%E7%9A%84%E9%87%8D%E5%BB%BA-54006ff0.md"
attribution: "New Distribution — https://xinjignxiao.com/en/articles/new-retail-is-not-the-rebuilding-of-people-goods-and-places-but-the-rebu-54006ff0/"
usage_policy: "https://xinjignxiao.com/ai-policy.txt"
---

# New Retail Is Not the Rebuilding of 'People, Goods, and Places', but the Rebuilding of 'Production, Supply, Wholesale, and Retail' Relations!

> The competition among value chain members is superficially a conflict of interests, but in essence, it is a conflict of discourse power. The saying 'the shop bullies the customer, and the customer bullies the shop' is an eternal business principle. Although the concept of 'New Retail' was proposed as early as 2016, 2018 is the first year of New Retail. This year, various New Retail species began to gain momentum, traditional retailers started their New Retail transformation, and original retail formats also put on the New Retail hat. From manufacturers and brand owners to distributors and logistics providers...

△ Add friend and note 'inspection' to register
**Introduction:** The competition among value chain members is superficially a conflict of interests, but in essence, it is a conflict of discourse power. The saying 'the shop bullies the customer, and the customer bullies the shop' is an eternal business principle.
Although the concept of 'New Retail' was proposed as early as 2016, 2018 is the first year of New Retail.
This year, various New Retail species began to gain momentum, traditional retailers started their New Retail transformation, and original retail formats also put on the New Retail hat.
**From manufacturers and brand owners to distributors and logistics providers, every link in the value chain is talking about New Retail, with hope or fear, admiration or rejection.**
As the year draws to a close, many companies are making plans for next year and are troubled: Is New Retail a pie or a trap? Should we embrace it actively? Or should we be wary of Mr. Ma snatching our baggage? Will New Retail burst like other hyped concepts? Among so many New Retail forms, which ones can last longer and which ones are the future trend?
Dialectics holds that contradiction is the fundamental driving force for the development of all things. Business is no exception, and this contradiction is reflected in business as the conflict between two or more opposing and unified things.
If you grasp the conflict, you can easily see through the essence of business, including the essence of New Retail, and clearly understand its past and present, and foresee its future.
New Retail is sought after and controversial because its proposal hits the 'conflict' in the commercial value chain, and at the same time, the practice of New Retail creates new value chain conflicts. Whether New Retail has vitality and can sustain depends on whether it can truly and continuously resolve conflicts in the value chain.
First, look at a diagram from Kotler's Marketing Management showing 'five flows of goods in marketing channels'. In this diagram, Kotler also classifies retailers as 'distributors' because they directly face customers.
Then the traditional value chain relationship is relatively clear, roughly forming a division of labor: brand owners and manufacturers create value, and distributors (broadly including delivery agents, narrowly including wholesalers and retailers) transmit value.
The conflicts among channel value chain members, on the surface, are interest conflicts, as they bargain for benefits. McCammon said, **'The traditional channel structure is a highly loose network, where manufacturers, wholesalers, and retailers are loosely connected, engaging in unenthusiastic bargaining, each acting on their own.'**
Each channel link wants to maximize its own profit, but just wanting is not enough; achieving profit maximization relies on channel discourse power. The conflicts among members of the channel value chain are fundamentally a competition for discourse power.
Before around 2013, the conflicts in the channel chain had reached a relatively balanced state. Brand owners relied on differentiated products and brand pull to form their discourse power, while retailers relied on their natural proximity to consumers and continuous expansion to form their discourse power. **Distributors balanced between the two: generally, larger distributors would represent several first- and second-tier brands, thereby forming a bargaining power against retailers, and then use their control over terminals to win manufacturer support.**
The irreplaceability of brand owners and retailers, and the clever balancing by distributors, formed a dumbbell-shaped stable state, temporarily resolving channel conflicts.
However, the advent of the mobile internet era broke this balance and created new conflicts.
Mobile internet greatly increased connections between people, making it easier for people to connect with each other, with brands, and with products. Since retailers are naturally close to consumers, they were the first to realize this and had an advantage in using internet tools. Therefore, some large online trading platforms gradually formed.
Online platform providers were the first to provoke conflict, targeting traditional 'middlemen', aiming to revolutionize them, to flatten and remove intermediate links, and to have 'no middlemen to earn the difference'.
To be honest, middlemen are unfairly treated. This 'de-intermediation' movement blamed traditional commerce's high prices, rampant counterfeits, and poor service experience on distributors, and also blamed the low efficiency and severe internal friction of traditional channel chains on distributors.
**Whether you are willing to admit it or not, various online platforms basically rose under the banner of 'de-intermediation'.**
All the scapegoats in the world are due to a lack of 'discourse power'. Without discourse power, there is no dominance, and you can only be controlled by others. The market does not believe in tears, and being the scapegoat is unavoidable. From my personal experience, the majority of distributors have either quit, been acquired, or seen their performance drop by more than half in recent years.
After eliminating the middle links, is there no conflict?
The answer is no. In recent years, most manufacturers selling products directly to customers on e-commerce platforms have had profits far lower than offline. For example, Three Squirrels, a viral product, has had a net profit margin of only 5 to 8 percentage points in the past two years, and more companies have only one or two percentage points or even losses.
Why did my profits decline when I clearly reduced intermediate links, directly communicated with consumers, could see feedback and reviews, and had higher communication efficiency with consumers?
Before brand owners could figure out what was happening, Mr. Ma told us, 'It's not that physical businesses are not working, it's that your physical business is not working.' You give consumers a poor experience, so we need to rebuild people, goods, and places.
Thus, New Retail was born.
Many brand owners almost spat blood: We originally called ourselves brand owners or manufacturers, and our business was to develop and produce products and build brands. Now you make us build online flagship stores, take orders, sell goods, ship, handle customer complaints, and handle returns and exchanges. Now we don't know whether to call ourselves brand owners or retailers. And now you say this model is dying. Should we follow or not?
This is not the end; the harsher part is yet to come. As I mentioned before, if traditional e-commerce was a 'de-intermediation' revolution, then New Retail is a close combat between platform providers and brand owners after eliminating middlemen. Hema calls itself a 'digital-driven one-stop comprehensive service provider for New Retail'. After proposing New Retail, Mr. Ma then promoted 'New Manufacturing', with his hand already reaching out to traditional brand owners.
'Here, New Retail refers not only to the 'retail link' but to the entire business system related to retail, including brand owners, distributors, retailers, and service platforms. **The ambition of New Retail is not the rebuilding of 'people, goods, and places', but the rebuilding of 'production, supply, wholesale, and retail' relations.**
Whether you produce biscuits, candy, milk, beverages, clothing, or books, or distribute tissue, stationery, toothpaste, soap, appliances, or mobile phones, as long as your products enter households through retail, you are all part of the 'New Retail' system.
This is not New Retail at all; it is clearly about establishing a new business with retailers (platforms) as the core.'
The core of this conflict is still the competition for discourse power, manifested as who has greater influence over C-end consumers.
In this battle, brand owners have the advantage of timing (providing product value), platform providers have the advantage of location (closer to consumers) and first-mover advantage. So who will win depends on who can win the harmony of people, that is, who can win more users. Therefore, I and Mr. Liu Chunxiong call it the fight for C-end traffic, and currently platform providers have the absolute upper hand.
Based on this, we can foresee the future of New Retail: In some industries, if brand concentration is low, brand discourse power is weak, and consumers' brand awareness is not strong when choosing such products, then such industries are easily integrated by 'New Retail'. Platform providers will connect upstream and downstream in that industry and become the chain leader of the channel chain. Examples include fresh produce, small restaurants, low-value daily necessities, and some fast-moving consumer goods.
In other industries, it will be completely different. A reader commented, 'The most profitable single product in the world is the iPhone, which follows a path completely opposite to 'New Manufacturing'.' I have said that 'Apple will not be integrated by New Retail, nor will Xiaomi; Moutai will not be integrated, nor will Laoganma.' Even brand owners like HLA and Xiaomi can claim to be 'New Retail' because they have their own traffic and can play as they like. In these fields, Mr. Ma's platform-based New Retail model has basically no way to survive.
Through the analysis of the hot topic 'New Retail', I will explain to readers how conflict theory is applied in the value chain, how to judge whether a new sales channel or business format has value and future, and how to discover conflicts in the value chain. The summary is as follows:
1. The conflicts in the value chain are superficially interest conflicts among channel members, as each link seeks to maximize its own interests. In essence, it is a conflict of discourse power. 'The customer bullies the shop, and the shop bullies the customer' is an eternal business principle.
2. In the early years, e-commerce platforms discovered the conflicts of low efficiency in channel chain operations and consumers always paying higher premiums, and used 'no middlemen to earn the difference' to win massive traffic, quickly growing into industry giants.
3. After middlemen declined and B2C became prevalent, consumer conflicts were partially alleviated, but brand owners' profit margins dropped significantly, creating new conflicts, and the new solution became New Retail.
4. New Retail can resolve some conflicts, but not all value chain conflicts, and it will also create new conflicts. The game and co-opetition in the channel value chain will continue.
5. Since there are multiple parties in the channel value chain, conflicts are normal in its operation. Discovering the patterns of conflicts in different times and environments is the only way to master the essence of channel operations.
Source: Laomiao Tears Marketing (ID: yiheyingxiao)
**The 10th B-end E-commerce Inspection - 'From Products to Scenes'**
Event time: December 10-13
Event location: Wuhu, Nanjing, Changsha
Event schedule:
> Morning of December 10: Visit Three Squirrels headquarters + snack store
>
> Afternoon of December 10: Visit Nanjing Squirrel small store
>
> Evening of December 10: Visit Nanjing Master Gao Beer Workshop
>
>
>
>
> All day December 11: Nanjing to Changsha, or free arrangement
>
>
>
>
> Morning of December 12: Community group buying exchange salon
>
>
> Afternoon of December 12: Koala Select Heroes League launch event
>
> Evening of December 12 to early morning of December 13: On-site inspection of Koala Select logistics center - **This time is the peak sorting period in the warehouse, allowing direct observation and learning of the backend operation process of community group buying e-commerce**
**Welcome interested distributor friends to join us for understanding and on-site inspection** :
**Organization form**
************1. Big-name exchange salon************************2. Company visit
3. On-site explanation
4. One-on-one communication************************************5. Actual market case visit************************
Friends who want to participate
If you are interested in a specific day's content, you can register separately
Long press this QR code or click 'Read Original' to register in one click!
Add friend and note your intention
-END-


---

## Copyright and AI use

This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL.

Contact: zhaobo258@gmail.com · +86 158 5481 7671