Source | Innovative Retail Society ID | dnwlkjyxgs Author | Zhao Shengnan
Preface: Innovative Retail Society has learned from multiple sources and confirmed through cross-checks with internal staff and core suppliers that Pupu Supermarket is about to launch its offline layout, with the first stop planned for next year in Fuzhou, opening an experience store, and will gradually expand to other cities. A commercial transformation from online to offline is quietly unfolding. Besides Pupu, giants like Meituan, JD.com, and Alibaba have also ramped up their offline businesses: Meituan's Xiaoxiang Supermarket has announced its imminent opening; the already-opened physical store "Happy Monkey" has also entered the fray; JD.com has launched "JD Discount Supermarket"; and Alibaba has deployed formats like Hema NB. This is no longer a simple channel expansion, but a comprehensive evolution and deep competition among e-commerce giants around supply chain efficiency, user experience, and business model sustainability after growth has peaked. The offline market is about to face a fierce competitive storm. Pupu Supermarket, Moving Offline It is reported that Pupu Supermarket's first offline store will be located in its home base, Fuzhou, with a store area of about 5,000-6,000 square meters, at the former site of Yonghui Supermarket. From its supply chain foundation, city-deepening strategy, to business operations, Pupu has significant advantages in this offline expansion. Founded in 2016, Pupu Supermarket focuses on building a one-stop shopping platform with 30-minute instant delivery via mobile. In its 9 years, it has only entered 9 cities, not pursuing blind expansion but focusing on deepening and steadily expanding in entered cities. For example, in 2025, Pupu added only Quanzhou as a new city, planning to increase the number of warehouse stores there to 10 within the year, especially with four stores in the core urban district of Fengze, aiming to shorten regional delivery radius by 30% through dense warehousing, and striving to achieve break-even within 6 months. In the instant retail industry, which commonly "burns money" for scale, Pupu Supermarket's ability to quickly recoup investment is rare. As of May 2025, Pupu Supermarket has deployed over 400 large front warehouses in 9 cities including Fuzhou, Xiamen, Guangzhou, and Shenzhen, with each warehouse covering 800-1,000 square meters and 6,000-8,000 SKUs. In comparison, Dingdong Maicai's front warehouses are about 300 square meters with about 3,000 SKUs. Pupu's large warehouse model is more conducive to integrating regional demand, with product richness close to that of a medium-sized supermarket, laying a solid foundation for opening offline stores. At the business level, Pupu is also continuously testing new formats. In September 2025, it launched the "Pupu Kitchen" channel on its app, selling over a hundred types of catering products, likely exploring a path for the processed food and beverage format in offline stores. According to a related supplier of Pupu Supermarket, Pupu Kitchen will also expand to other cities in the future. Traditional Supermarkets Are Fleeing, While E-commerce Giants Are Entering the Fray In 2025, the survival environment for traditional offline supermarkets has become increasingly severe, with many chain brands seeking relief through "slimming down." For example, Yonghui Supermarket's store count dropped from 775 at the end of 2024 to 552 in June 2025 and 450 in September. However, while traditional supermarkets are cutting losses, e-commerce platforms are forcefully entering the offline market. From Pupu to other leading players, all have joined the battle with their unique business models, adding variables to an already fierce competitive landscape. 1. Alibaba: Investment, M&A, and Self-Building. Self-operated Hema expands in lower-tier markets, blooming nationwide. Alibaba's offline layout began with early exploration of single formats like Intime Retail, then gradually expanded to home appliances, supermarkets, home furnishings, and other fields, eventually forming a full ecosystem covering "clothing, food, housing, and transportation." After years of exploration, at the current stage, Alibaba is no longer blindly expanding offline retail scale but focusing on improving quality and efficiency. For example, last year it cleared out Intime and continued to reduce traditional retail businesses with poor profits. Meanwhile, Alibaba actively develops new retail formats represented by Hema. As a benchmark for Alibaba's new retail, Hema achieves online-offline integrated operations through the "fresh food + dining + instant delivery" model, meeting consumers' composite needs for convenience, quality, and scenarios. As of October 2025, Hema's two main formats (Hema Fresh + Hema NB) have over 700 stores, with GMV exceeding 75 billion yuan in fiscal year 2025 (April 2024-March 2025), achieving full-year profitability. 2. JD.com: Leveraging core advantages of self-operated supply chain, trying different segmented formats like JD MALL, JD Discount Supermarket, and Qixian. JD.com's exploration in offline retail has lasted over a decade, similar to Alibaba. In the early stage, JD's attempts mainly revolved around its core category advantages, with relatively small-scale formats. For example, the "JD Help Service Store" extended from after-sales service for home appliances, and later the "JD Convenience Store" and fresh supermarket "Qixian" gradually validated the single-point model. After 2021, the strategy clearly shifted towards large-scale and experiential. JD successively launched "JD MALL" and "JD Electronics City Flagship Store," large comprehensive experience centers of tens of thousands of square meters, reshaping offline consumption experience through immersive scenes and consistent online-offline pricing and service. The latest planned 5,000-square-meter JD Discount Supermarket is likely the next new stage in offline exploration. Even before opening, it has attracted considerable attention. It is reported that the first store in Zhuozhou, which has already opened, saw 60,000 visitors on its opening day. 3. Meituan: Relying on local life traffic and rider network, launching Happy Monkey hard discount supermarket, with plans to open Xiaoxiang Supermarket offline stores in the future. Meituan's exploration of offline retail was interrupted for a period in 2020. Its early attempt, Xiaoxiang Fresh, failed due to poor management. This year, it launched Happy Monkey hard discount supermarket, positioned for the mass market with high cost performance. Market sources estimate that the first store in Hangzhou achieved daily sales exceeding 400,000 yuan on its opening day (though Meituan has not officially confirmed this data). Why the Rush to Offline? The Inevitable Choice After Online Traffic Peaks The collective move of e-commerce giants to offline is not accidental but a necessary stage of market development.
- Online traffic dividends have peaked With slowing online user growth and rising customer acquisition costs, online traffic dividends are gradually peaking.
- Baidu search index for Double 11 has been declining since 2019, with recent heat levels falling back to around 2013 levels;
- A survey shows that during Double 11 in 2023, 43% of consumers chose "not to buy";
- Total Spring Festival red envelope amounts on various platforms fell from a peak of over 18 billion yuan in 2021 to about 9.2 billion yuan in 2022. For e-commerce platforms, laying out offline stores is not only a direct way to acquire new traffic but may also create a new growth engine.
- Traditional supermarkets are shrinking, providing opportunities for new players Traditional supermarkets are facing severe challenges, with many forced to close stores or strategically reduce scale. Data shows that in 2023, the sales scale and total store count of China's top 100 supermarket enterprises fell by 7.3% and 16.2%, respectively. The closure of a large number of stores has left gaps in the market. If e-commerce giants use their digital capabilities, supply chain, and capital advantages to quickly seize these vacated market positions—like Pupu Supermarket's upcoming store at the former Yonghui site—it could be a dimensionality reduction attack on traditional formats.
- Offline scenarios have irreplaceable value Offline stores provide a sense of experience and trust that online cannot replace. Consumers can see and touch products directly and buy immediately. A shopping environment where seeing is believing builds brand trust. Additionally, offline stores themselves serve as important brand advertising and logistics nodes, enabling integration of "online traffic, offline experience" or "offline experience, online repurchase," complementing each other. Who Will Ultimately Win This Offline Melee? The offline market is a touchstone for testing supply chain and operational capabilities. The collision between new and old players is not a life-or-death struggle but jointly opens the curtain on industry upgrading. The future belongs to the "integration faction" that can connect online and offline and provide seamless experiences.