“How can I get involved in instant retail?” “How do I connect with platforms?” “How do I cooperate with lightning warehouses?”... Recently, instant retail has exploded, and many distributor friends have come to ask these questions. As early as 2019, New Distribution conducted a special industry survey on O2O and published an industry report. But at that time, the relevance to distributors was limited; it was more about brand owners and retailers participating, simply moving offline store products online. However, with the large-scale expansion of instant retail, various front-warehouse formats focused on instant retail have emerged, especially the lightning warehouse format. The demand for localized supply is increasing, and distributors now have more opportunities to participate. A while ago, in Nanjing, I visited a very young post-90s entrepreneur: Hu Rui, General Manager of Nanjing Maihaohuo Supply Chain. He is a typical representative of distributors doing instant retail supply chain. A typical traditional beverage distributor, starting in 2023, he began supplying lightning warehouses in the Nanjing area. In less than two years, his trading business scale doubled, with annual sales exceeding 100 million yuan. How did he build an instant retail supply chain? Next, I’ll share his case with you. Building a Lightning Warehouse Supply Chain from Zero Hu Rui started as a distributor in 2018, mainly doing beverages, with first-year sales of about 5 million yuan. By 2023, the traditional trading business scale was around 50-60 million yuan. At this scale, Hu Rui found that the business had entered a state of involution. First, traditional agency business is hard to break through, and the risk of large capital investment is too high. In a city like Nanjing, expanding scale by horizontally adding brands and categories comes with many manufacturer requirements and even more unspoken rules. Especially since Maihaohuo started late, its regional scope is limited. He also considered doing B2B, but the risk of large-scale investment is too great; if it fails, he might lose even his basic business. Second, traditional channel business is shrinking and being continuously diverted, requiring new business to support development. In the past two years, trading business has been difficult. E-commerce, snack discount stores, instant retail, and convenience store chains are all grabbing share from traditional channels. Competition in “old” channels is increasingly fierce, and investing in such channels does not yield proportional returns. For Maihaohuo Supply Chain, new business is needed to support the next stage of development. Why focus on the lightning warehouse supply chain? In early 2023, Hu Rui opened a lightning warehouse himself, but during operations, he encountered many problems: lack of experience, price wars, difficulty sourcing goods, intense competition, etc. Eventually, he closed it. From this experience, Hu Rui drew a conclusion: “Only professionals can do professional things. Distributors lack experience in online retail operations. Without a professional operator, it’s hard to do well on their own.” So Nanjing Maihaohuo clarified a direction: focus on doing supply chain well. According to official data, lightning warehouses still have huge market space in the future, and behind this, there will definitely be a need for supply chain supply. Maihaohuo plays this supply role. This was Hu Rui’s initial idea for doing a lightning warehouse supply chain: Follow the continuously growing format, continuously respond to their needs, and we will have value. The result is good: in less than two years, Maihaohuo transformed from a single beverage distributor into a full-category supply chain, and the overall business scale doubled. From the Organizational and Development Perspective How to match and do supply chain? Distributors often have a misconception when starting new business: Do we need to find connections and resources to do a new channel? But developing lightning warehouse stores is relatively less complicated. In the early stage, as long as you find the store, there’s a high probability of establishing a cooperative relationship. Maihaohuo’s method for developing stores is the simplest: sweeping the streets. Finding stores— Finding lightning warehouse stores is actually simple: open Meituan’s app—Flash Purchase—24h convenience stores, and you can basically map out the local lightning warehouse store locations. Visiting— Choose to visit in the evening. During the day, most lightning warehouses are staffed by employees, so visits are likely ineffective. In the evening, it’s usually the time when owners check their stores, so they are likely to be there. This is when business visits are more effective. Negotiation— Seize the core pain point of lightning warehouses: heavy goods and FMCG products need a local supply chain for one-stop supply and fast fulfillment. No lightning warehouse owner wants to deal with dozens or hundreds of suppliers. Moreover, FMCG standard products are just traffic drivers in lightning warehouses and don’t make money, so they prefer to spend time and energy on daily necessities. So after visits, cooperative relationships were basically established. With a base of stores, the next step is to consider organizational matching. The lightning warehouse supply chain is a completely different operating model from traditional trading business, and there are differences in organizational structure. Maihaohuo’s lightning warehouse supply chain business, except for sharing the warehouse and distribution with the traditional business, is a completely newly built team.

  • Business (sales/customer liaison): Includes fixed order follow-up, price negotiation, product updates, and new product recommendations. Emphasizes communication efficiency and rapid response to maintain high-frequency cooperation.
  • Procurement: Responsible for upstream supply negotiations, price pressure, introducing new products, and SKU management.
  • Finance: Independently accounts for the costs, gross profit, and cash flow of the lightning warehouse business, handling settlements and subsidies. Here, it’s important to emphasize the difference between lightning warehouse business and traditional business. Traditional business focuses on daytime visits, more on development, store visits, display, and promotion execution. Customer relationships and orders are relatively stable, and sensitivity to new products and price changes is low. Fulfillment, Products, Operations Three Core Barriers to Doing a Lightning Warehouse Supply Chain Store development and organization are the most basic requirements. To truly do a lightning warehouse supply chain well, you must know what the lightning warehouse merchants actually need behind the scenes. Unlike two years ago when most were individual scattered stores, current lightning warehouse merchants are mostly chain brands. This leads many distributors to think that chain brands have central warehouses and fixed supply chains. Actually, that’s not the case. Don’t assume this format is mature. As of now, most warehouse stores do not have a unified, full-category central warehouse. Lightning warehouse brands generally allow their franchise stores to have self-purchasing rights, except for their own home base. Especially at the FMCG level, it’s basically the local lightning warehouse merchants who solve their own supply sources. So there is definitely huge demand space here, provided you can meet the merchants’ needs. The needs here are not simply having goods. Based on his past experience, Hu Rui divides the practice of doing a lightning warehouse supply chain into three stages, based on changing needs. Stage 1: Meet fulfillment requirements. During the wild growth of lightning warehouses, the primary requirement for suppliers was “goods must arrive the next day.” Even if orders are placed at night, they must arrive on time the next day, or they will be eliminated. When you see lightning warehouse stores on Meituan, it’s easy to notice their order volumes; many have monthly averages of 9,000+ or 10,000+ orders, which means lightning warehouses turn over very quickly. But most lightning warehouses have very little storage space and won’t have much inventory. This means if the frequency and efficiency of replenishment are not high, stockouts are likely, which is very bad for the consumer experience. So the requirement for timeliness is next-day delivery (T+1): order today, regardless of the time, must be delivered the next day. To ensure fulfillment, Maihaohuo specifically matches a “two-shift” model: Orders are cut off at 7 a.m. every day. Sorting starts at 5-6 a.m., and all sorting tasks are completed before noon, ensuring the first batch of drivers can do a second delivery the same day. One key point here: Fulfillment is a necessary condition for doing a lightning warehouse supply chain. Without this premise, merchants won’t want to cooperate with you. Stage 2: Solve the need for full product range. As the density of lightning warehouses increases, competition among merchants intensifies. Having goods is not enough; you need a set of goods that matches consumers. At this point, merchants’ demand for the supply chain is no longer just “goods arriving on time,” but more emphasis on the completeness and richness of products. Especially with increasing demand for new products, they hope suppliers can proactively find and quickly launch new items, covering as many SKUs as possible. For example, beverages expanded from 30 SKUs in traditional channels to 50 needed for lightning warehouses, and potato chips increased from 10 flavors to 15 flavors. Behind this is actually the merchants’ strong need for “one-stop shopping.” Especially since daily operations are already very busy, merchants want to reduce contact with multiple suppliers and consolidate more products into one supplier to save procurement costs and time. Based on this, Maihaohuo set up a dedicated procurement team to supply all categories around the category structure needs of lightning warehouse merchants, assembling a product range of 3,000 SKUs. Of course, expanding categories has a rhythm. Avoid blindly expanding categories when you don’t understand a category’s characteristics. Maihaohuo expands categories in stages. For example, Month 1: fill in beverage SKUs; Month 2: add alcohol; Month 3: expand the alcohol beverage range and add about 200 more SKUs; Month 4 and beyond: introduce snacks (leisure food). First big brands, then second-tier brands, then internet-famous products. Of course, there is a core question: How do you know which products lightning warehouse merchants need? Maihaohuo’s approach is to pull out the best-performing lightning warehouse merchants, break down their product lists, and introduce all products with sales above a certain quantity. Then gradually verify and strengthen: optimize the SKU mix based on actual sales data. Stage 3: Provide operational services. Since instant retail became hot, all brand manufacturers are very focused on the lightning warehouse format. But their biggest problem is that they don’t understand how to operate in this format. Some manufacturers arrange their regional managers to work with local distributors, but the results are generally mediocre. Why? First, brand-side regional managers at low levels don’t really understand online business. Talking to them about magic prices, coupons, full discounts, or how to get merchants to run promotions—they basically don’t understand. Second, some traditional distributors have rigid thinking and mismatched capabilities. For example, they struggle to meet high-frequency fulfillment requirements and lack the flexibility for small-order, high-frequency operations. Even if they can offer lower supply prices, they are unwilling to lower prices due to concerns about impacting their price system, and their internal interest structure makes it difficult to cooperate with the lightning warehouse operating logic. So in this process, a new need has emerged: the link between brands and lightning warehouse merchants. Brands want to directly connect with more lightning warehouses, and lightning warehouse merchants want brand resource support. But manufacturers cannot serve a single merchant, and merchants don’t want to deal with dozens or hundreds of manufacturers at once. This requires an intermediary role to do operations and services. Maihaohuo’s positioning at this point is as an operations service provider that connects the upper and lower levels. On one hand, it explains platform rules and activity mechanics to merchants, helping them improve sales efficiency; on the other hand, it assists brands in understanding and adapting to the lightning warehouse channel, promoting optimization of pricing strategies, activity mechanisms, and listing rules. Final Thoughts Hu Rui told New Distribution that the instant retail supply chain is not a simple “price war” track, but a business of “value war” and “efficiency war.” Price can bring short-term orders, but what truly settles and forms barriers is who can provide longer-term value. The essence of supply chain is never about who has the lowest price; value competition is the core. Whoever can continuously add value will be able to build a thick barrier in this seemingly low-margin business. Due to space limitations, it’s impossible to elaborate on all of Nanjing Maihaohuo’s business methodology. For this reason, Mr. Hu Rui, General Manager of Nanjing Maihaohuo Supply Chain, will attend the “2025 Instant Retail Supply Summit and First Instant Retail Store-Warehouse Product Selection Fair.” At that time, he will deliver a keynote speech titled “The Path from a Single Beverage Distributor to a Full-Category Lightning Warehouse Distributor,” sharing his latest thoughts on the lightning warehouse supply chain model. Interested friends can scan the QR code to learn more! **🔺