Source: Huashang Taolue Author: Li Ruiqi On December 20, 2017, one month after Alibaba Group invested in Sun Art Retail (the parent company of RT-Mart and Auchan), Alibaba Group CEO Daniel Zhang appeared at RT-Mart's annual employee meeting. "I'm a bit excited, very honored and destined to be here." On stage, Zhang could hardly contain his excitement. Huang Mingduan, now in his sixties, remained lean and spirited, with his hair neatly combed, wearing gold-rimmed glasses, a crisply ironed black suit, and a festive red tie. He occasionally joined RT-Mart employees in applauding Zhang's speech. At this time, his identity in press releases was already Vice Chairman of Ruentex Group (the former major shareholder of Sun Art Retail), rather than his previous title, "Chairman of RT-Mart Group and CEO of Feiniu.com." But in the eyes of the outside world, Huang Mingduan has always been synonymous with RT-Mart's "retail empire." I Three years ago, Huang Mingduan would never have imagined that RT-Mart would be sold to Alibaba. At that time, he was striving to make his own creation, Feiniu.com, into the first tier of e-commerce. In an exclusive interview with the media, he said his biggest hope was that Liu Qiangdong and Jack Ma would both "scold" him. "If they scold me, I'll have motivation. We look for them to scold us every day, but they just don't. We feel quite frustrated." When he said this, Huang was already over sixty. In terms of age, Liu Qiangdong and Jack Ma were his juniors. In terms of retail experience, Ma and Liu were also his juniors. But in the end, fate played a big joke on him. Fate played three big jokes on Huang Mingduan. The first two times, he successfully knocked "Old Man Fate" to the ground. Huang Mingduan is known for single-handedly creating RT-Mart and opening an era in mainland China's retail industry, but his fate began in a small rural village in southern Taiwan. Over the past few decades, miraculous reversals have always happened to him. The first joke fate played on Huang was when, as a young boy, he helped stand guard at a gambling den and was almost recruited by gangsters to become a thug. After becoming an entrepreneur, he once joked, "With my personality, being a big gangster might be more suitable." But he, who scored only single digits on his junior high English exam, later became a master's graduate from the Graduate Institute of Business Administration at National Taiwan University. The second joke fate played on Huang was when he was at the height of his career in Ruentex's textile division, he was suddenly appointed to enter the retail industry. A year later, he was sent to mainland China to compete with foreign retail giants like Walmart and Carrefour. Ten years later, in 2010, RT-Mart achieved revenue of 40.4 billion RMB, replacing Carrefour as the champion of mainland China's retail department store industry. On July 27, 2011, RT-Mart and Auchan merged and listed in Hong Kong. Sun Art Retail, which owns "RT-Mart" and "Auchan," surpassed Walmart in market share and became China's largest retailer. Huang Mingduan also earned the reputation of "King of Land Warfare." Although he has always stayed behind the scenes, in the retail industry, not knowing Huang Mingduan's fame and achievements is a sign that you are still very marginal in this industry. II Huang Mingduan has two people to thank for winning the two big battles of life. The first person is his mother. Huang, the youngest of seven siblings, grew up in such poverty that they often didn't know where the next meal would come from. After junior high, he applied to a vocational school, choosing the woodworking mold major, with the aim of working sooner to earn money and help support the family. But at that time, the annual tuition of 520 New Taiwan Dollars was also a difficulty for the Huang family. Fortunately, his mother used the family's not-yet-grown pigs and planted sugarcane as collateral to borrow money from relatives and neighbors, allowing his studies to continue. "Why study?" "When can you pay back the borrowed money?" The sarcastic remarks from relatives and neighbors during his mother's borrowing greatly stimulated Huang's self-esteem and made him vow to change his fate. At that time, the school stipulated that if you ranked in the top three in exams, you could be exempted from tuition. Huang then went all out, studying hard, not only ranking in the top three in his class but also continuing to a master's degree at NTU's Business Research Institute, winning scholarships every year. After becoming famous, Huang often went to poor areas with his wife to do charity. Once, in a rural area of Guizhou, Huang communicated with more than 100 local children on site, using his own experience to encourage them never to look down on themselves. "What I am most grateful for is that my parents did not give me a wealthy family. Because I was born in a rural family, it gave me endless motivation." This personality of "if you look down on me, I will prove you wrong with facts" ran through Huang's life. Accompanying this personality is the character of gratitude. At NTU, Huang met the mentor who changed his life: his classmate, the son of the Ruentex Textile Factory, now Ruentex Group President Yin Yen-liang. This is the second person Huang needs to thank. Yin and Huang came from completely different backgrounds, one from a wealthy family, the other from a grassroots background. But they became lifelong friends and golden partners on their later life paths, based on the same personality and beliefs. Yin, who was sent to a reform school in his youth, is a second-generation entrepreneur who turned himself around from the edge of a cliff. After recognizing his life goals, he vowed to carry forward his father's business. His appreciation and use of Huang was one of the most important and correct decisions of his life, and it brought him rich rewards. In the early years at Ruentex, Huang proved Yin's vision with his performance. After graduating from NTU, Huang joined Ruentex, which was still a textile factory at the time. Soon, he was entrusted with an important task: finding a contract factory that could process garments for Ruentex Textile. Someone hinted that he should be flexible and could get a 2 yuan kickback per order. This kickback was a considerable amount for Huang, who came from a poor family, but he refused without hesitation. This principled style of conduct also ran through Huang's subsequent career. His time in the textile factory also laid a foundation for Huang's later transition to retail: rigorous process management thinking. Although in the eyes of outsiders, these are two completely unrelated industries. III Transitioning from the familiar textile industry to the completely unrelated retail industry was the second joke fate played on Huang Mingduan. In response to changes in the economic situation, in 1996, Ruentex Group established RT-Mart Distribution Co., Ltd. to enter the retail industry. Yin Yen-liang, already the president of Ruentex Group, made a decision that surprised others: He appointed Huang Mingduan, who had no retail management experience, to helm RT-Mart. The reason he valued was that Huang was "smart, hardworking, and acted quickly, ruthlessly, and accurately," and was a "wolf king" who could expand territory. This also opened the most glorious part of Huang's career. In the new retail industry, Huang faced two difficulties: first, the industry was completely different; second, he was already 41 years old and going to unfamiliar mainland China. But he took only about 10 years to win the status of "King of Land Warfare." How did a middle-aged outsider, facing a new field in a new market, get started? How did he create the miracle of an outsider defeating insiders? Huang's approach was to imitate first, then surpass. He was the king of learning from others, and also "one who can learn from himself is a king." Huang is someone who learns from the world and integrates the strengths of others to be himself. He once told the media: "Part of my fresh food purchasing operations is learned from the United States, but the overall store design is learned from Europe, and product selection is learned from mainland China." Initially, RT-Mart imitated the warehouse-style sales format of the European retail giant Makro. In 1997, RT-Mart established Shanghai RT-Mart Co., Ltd. in mainland China and opened its first store, RT-Mart Pingzhen Store, but the response was not good. Huang likes to ponder. After visiting and observing the domestic hypermarket market, he found that compared to Makro's coldness, Carrefour was extremely popular. So when the third store opened in mainland China, he decisively stopped the warehouse model and, using Carrefour as a benchmark, switched to the hypermarket business model. The effect was immediately apparent. In 1999, RT-Mart achieved revenue of 24 billion RMB, leaving Makro behind. On December 21, 2000, Ruentex Group formed a joint venture with French Auchan Group to promote the hypermarket business of both Auchan and RT-Mart brands in mainland China. Huang seized the opportunity to frantically learn Auchan's operational experience, even copying almost all of Auchan's internal operational documents. The following year, China successfully joined the World Trade Organization, and the retail industry was officially opened to the outside world. Retail hypermarkets ushered in a golden decade in China. World giants like Walmart and Carrefour accelerated their pace of expansion in China. Unexpectedly, the mantis stalks the cicada, unaware of the oriole behind. This oriole was Huang Mingduan. By studying the business models of retail giants like Walmart and Carrefour, Huang concluded that Walmart is centralized, and although its stores are standardized, it doesn't adapt to local conditions. Carrefour is decentralized, led by store managers, with more flexibility. In the end, Huang summarized a unique model, a "middle way" between centralization and decentralization: the central office is responsible for store opening, purchasing, and distribution, while product pricing, membership management, and in-store displays are left to local autonomy. Huang, who considers himself a learner, is not afraid of being seen as a "student," even after achieving success. At a retail chain annual meeting, attendees thought Huang would share RT-Mart's successful experience and came with the goal of learning from Huang and RT-Mart, but Huang spent a lot of time and space introducing Walmart's culture. While learning from competitors, Huang also paid great attention to avoiding their strengths. When Walmart and Carrefour harvested the Chinese market from top to bottom (starting with layout and store openings in first-tier cities, then expanding to second- and third-tier cities), he did the opposite, opening stores in second- and third-tier cities, occupying places with huge consumption potential but not noticed by the giants. This also laid a solid foundation for RT-Mart's development. For example, RT-Mart's famous national store king (the store with the best performance) comes from Kunshan, not from first-tier cities like Beijing or Shanghai. Huang is not afraid of fighting. In business battles, he fully displays his wolf king nature. Once, RT-Mart launched a promotional activity in Taiwan selling cherries at 99 yuan per jin. Seeing this, old rival Carrefour countered with a TV ad selling cherries at 92 yuan per jin. Huang, who was on an overseas tour with Carrefour's general manager, learned of this and immediately directed his colleagues via an overseas call to sharply cut the price to 88 yuan per jin, leaving Carrefour with no room to fight back. "Peter (Huang's English name), don't be so ruthless. I'm traveling with you, and you still hit me like this," Carrefour's general manager said helplessly to Huang. One of Huang's catchphrases is "Who's afraid of whom?" He even often jokes that he is actually suitable to be a "big brother," but fate made him from a "gangster big brother" to a "hypermarket big brother." Taiwanese media called him "the wolf who bites money." On the other side of the wolf is always the demeanor of a big brother. When he first arrived in the mainland market, Huang took over a team that had lost senior executives and was in a state of panic. To boost morale and give employees a sense of security, he launched a series of training and promotion systems, and vigorously promoted employee shareholding. As long as employees had been formally employed for 6 months, including frontline cashiers, they could calculate shareholding quotas at about 10% of their annual salary. Compared to his brilliant achievements, Huang is even more proud of this incentive system. He sincerely regards RT-Mart employees as his brothers and sisters. "All employees are partners and masters." From an outsider to the helm of the industry's number one, Huang developed his own methodology and is quite confident in himself. For example, when inspecting stores or selecting sites, Huang likes to do it alone. If someone is nearby, he will sternly ask them, "Please keep your mouth shut, because your words will affect my judgment." Compared to accumulating experience and honing intuition, he is better at turning experience and intuition into standards and discipline. In RT-Mart, there is a set of what the industry calls the "Sunflower Manual" - the SOP standard operating procedure, i.e., the "Operations Personnel Standards Manual," which is regarded as RT-Mart's top secret. It is said that if printed, its thickness can exceed a dictionary. Opening the manual, you can see at a glance what each employee in each position should do, and newcomers can quickly get started. Moreover, this manual is continuously revised every year. Thanks to this, in 2013, when Huang took personal command of e-commerce at the age of 58, he could safely hand over RT-Mart's offline business to his subordinates and move with the e-commerce team to a new office. After that, he only held half-day meetings with senior executives each week to discuss RT-Mart's offline business. Choosing to enter e-commerce, Huang made a big decision and made significant changes. At first, Huang dismissed e-commerce, believing that the logic of burning money did not conform to business rules. But the unstoppable influence of the internet gradually penetrated the life of this retail giant, eventually changing him. His daughter used her phone to tell him that with a simple search, she could see the locations of a dozen restaurants around her. Such examples became more and more frequent. When he found that employees around him had started shopping on Taobao and JD.com, Huang finally realized that he could no longer refuse the internet. His awakening and change were already late, but some were more stubborn than him. Regarding whether to do e-commerce, the directors of Sun Art Retail's board had differing opinions. Some directors believed that physical stores were still growing and there were still opportunities in fourth- and fifth-tier markets, so RT-Mart didn't need to do e-commerce. If it wanted to, it could cooperate with giants. At the critical moment, the big boss supported him. In 2013, with Yin Yen-liang's strong support, Huang launched an independent e-commerce platform - Feiniu.com - and began to build his internet retail empire. On the day he announced his entry into e-commerce, he made a bold statement: "If we play, we play big. Small play is not my style." But it was still too late. In a world where being one step behind on the internet could mean being an era behind, he was still too late, too late to turn the tide. Compared to JD.com and Alibaba, his Feiniu was not only too late, but also too slow and too small. He tried hard to benchmark against Alibaba and JD.com, saying his biggest hope was that Liu Qiangdong and Jack Ma would both "scold" him. "If they scold me, I'll have motivation. We look for them to scold us every day, but they just don't. We feel quite frustrated." When he said this, Huang was already over sixty. In terms of age, Liu Qiangdong and Jack Ma were his juniors. But in the eyes of Ma and Liu, Feiniu didn't even count as a junior, let alone enter their line of sight. Even so, Huang never gave up, never gave up, never gave up, pushing Feiniu forward step by step, and making achievements visible step by step. According to Sun Art Retail's 2017 interim report, Feiniu, which had been running for three and a half years, had a total transaction volume of 1.8 billion yuan in the first half of the year. As of the report's release, it had 28 million registered members and 3.5 million active members. But it was still losing money. And in e-commerce, under the wave of new retail, RT-Mart's offline business was also under challenge and needed change. An era was not just turning a page; it was coming to an end. Those who couldn't enter the new era could only be forgotten by the times. Fortunately, the foundation laid over more than 10 years of hard work was still there, and this new era was also coming toward him. Because even Jack Ma, who proposed "new retail," was going all out to move offline. So the rest of the story is known to everyone. On November 20, 2017, Sun Art Retail (the parent company of RT-Mart and Auchan) announced it would sell shares worth a total of HK$22.4 billion (about RMB 19 billion), and the buyer was Alibaba. "RT-Mart doesn't need to do e-commerce. If it wants to, it can cooperate with giants." The words of the director who opposed Huang's e-commerce at the board meeting came true. Although Huang once joked after visiting Alibaba's Hema Fresh that he had been "tricked by Jack Ma," and left a resounding remark, "We are ten years behind Liu Qiangdong, but only one year behind Hema Fresh," this "King of Land Warfare," who defeated all opponents in his era, still compromised with the times and with the masters of the new era. On the day of announcing the cooperation with Alibaba, facing the media, Huang repeatedly said, "Alibaba is the best partner for Sun Art Retail. This is the best choice for shareholders, the company, employees, and consumers." This was his true words. Previously, old subordinates had worried that Huang might lose his reputation because Feiniu didn't succeed. But Huang said he didn't care about personal honor or disgrace; what mattered was whether RT-Mart could win. He even changed his previously set retirement plan to actively seek this battle. In the negotiations with Alibaba, Huang also focused on RT-Mart's future development prospects and employee interests. He wanted to leave them a good way out. To this day, Huang has not retired. All parties need him to helm RT-Mart for a while longer, and he still doesn't want to let down anyone who has given him trust. In his decades of venturing into the mainland market, Huang often traveled alone, carrying his luggage, with a few RMB in his pocket, flying economy class. Sometimes he would be in the northeast in the morning wearing a down jacket inspecting stores, and in the evening appear in Hainan in short sleeves for site selection. When tired, he would sleep in an ordinary hotel; when hungry, he would eat McDonald's. This man, who studied hard because of poverty in his early years, no longer needs to suffer for money, but he is still a "wolf that bites money." "Anyway, I'm either in the office or in the store." From leaving Taiwan for mainland China in 1997 to start from scratch, 20 years have passed in the blink of an eye. The "war wolves" who followed him to the mainland to fight are mostly with gray temples now. With the deep integration of Alibaba and RT-Mart, they may soon retire and go home. Compared to the goal set by Yin Yen-liang when they set out 20 years ago, it is an absolute triumphant return. Source: Huashang Taolue (ID: hstl8888) -END-