“These yellow stores on the street are popping up everywhere—near schools, in large residential communities, and at almost every university in Wuhan.” Wang Zi, a media professional living in Wuhan, has noticed that at least five such offline snack stores, known for their low prices and wide variety, have opened near his residence since the beginning of this year.
Image / Shelves inside a bulk snack store
Since 2022, similar offline snack stores have become one of the hottest retail formats. By bypassing distributors and sourcing directly from upstream manufacturers, they reduce costs such as channel entry fees, allowing them to offer products at lower average prices.
Consequently, these snack stores, operating on a thin-margin, high-volume model, have become the “new favorite” for foodies and are starting to empty the wallets of young consumers.
Some shoppers can buy a large bag of snacks for just 30 to 40 yuan at these stores; others treat them as warehouse-style self-service snack supermarkets, abandoning convenience stores and buying snacks exclusively from these outlets.
However, because these bulk snack stores focus on affordable leisure snacks, franchisees' gross margins are not particularly high. An industry insider told Modern Consumption that the comprehensive gross margin for their stores is only 18%. To put that in perspective, in 2022, Liangpin Shop's direct retail business and Lai Yifen's store retail business had gross margins as high as 47.47% and 51.24%, respectively.
Despite such low margins, many brands are entering the fray. What exactly is the appeal of bulk snack stores? Is it really a good business?
The Allure of Affordable Snacks
“Buying a big bag is super satisfying,” reads the most prominent yellow label above the shelves at Snacks Busy (Lingshi Henmang) on Duzheng Street in Changsha. The shelves are stocked with affordable snacks from our childhood: spicy strips, dried tofu, braised snacks, dried fruit, and more.
Moreover, over half of the snacks in the store are sold in bulk by weight, with most individual items costing less than one yuan—a “fracture price” that not only catches consumers' eyes but also stimulates their desire to buy.
Image / Products inside a Snacks Busy store
“I can see many Snacks Busy chain stores in Changsha. They have a wide variety of snacks, and even if you take one of each, it’s not expensive,” said Liu Qian, a tourist in Changsha. She added that the stores are clean and neatly organized, providing a great shopping experience. “The best part is that a big bag only costs 30 to 40 yuan—super satisfying!”
Not just in Changsha, Li Jing, a student at a university in Yunnan, said that after a bulk snack store opened on campus last year, she now buys snacks exclusively there. “A 2.5-yuan cola at the convenience store is only 1.8 yuan here; a 2-yuan bottle of water is 1.2 yuan; and a 4-yuan can of Wanglaoji or JDB is just 2.8 yuan. Getting the same products for less is a great deal,” she said.
Xu Na, born after 1995, also has a long history of buying snacks at offline snack stores.
In Xu Na’s memory, these stores became popular around 2022. At that time, one opened near her community, and young residents, including herself, would frequent it. The business seemed booming, with long lines at the checkout every time.
“In the past two years, the store has been renovated once or twice, each time giving a fresh feel, from product display to visual impact on customers. The variety of snacks is impressive—you can always find your favorite treats when you walk in,” Xu Na said. She particularly appreciates that, as someone living alone, online snack purchases often come in sets with items she doesn’t like, but here she can buy just two or three packs of each, filling a big bag with only her favorites.
“Its positioning is clear: targeting students and young people with one-stop snack supplies and a warehouse-style self-service supermarket. A pack of Weilong, a jelly, a bread—each item costs just 50 or 80 cents. For price-sensitive students or kids, there’s no embarrassment of putting something back because it’s too expensive. It gives customers face,” Wang Zi remarked, marveling at the charm of these stores.
The secret behind selling snacks at prices lower than convenience stores, allowing consumers to buy freely, is simply “authentic products sourced directly from large manufacturers.”
In this regard, a representative from Snacks Busy told Modern Consumption that in the traditional retail model, snacks go through multiple stages after leaving the factory—market sales, agents, distributors, retailers—each adding a layer of profit, resulting in higher prices for consumers.
Snacks Busy, however, bypasses distributors and directly connects with upstream food manufacturers and agents. By building a channel without middlemen, they eliminate hidden costs like supermarket entry fees, barcode fees, and online platform commissions, leading to lower average prices and a wider product range. “The SKU count at Snacks Busy stores exceeds 1,600,” the representative added.
Beyond being diverse and cheap, low-priced snacks have gained market demand in the post-pandemic era as consumers shift from open wallets to tightened budgets, from upgrading to rational spending, and increasingly prioritize cost-performance. This has also won recognition from capital.
Data shows that despite a generally cold market last year, the leisure snack sector still secured 1.3 billion yuan in financing. Snacks Busy, Snacks Youxuan, and Ai Snacks all received investments. Zhao Yiming Snacks completed a 150 million yuan Series A round in February, and Snacks Youming announced a Series B+ round last month.
Clearly, with ultra-low prices, bulk snack stores have not only won over foodies but also earned a seat at the capital table, heralding a new snack revolution.
“Thin Margins, High Volume” Meets “Great Turmoil”
Undoubtedly, low prices attract more consumers, and bulk snack stores achieve ideal returns through “thin margins, high volume.”
A representative from Snacks Busy told Modern Consumption that in 2022, the total retail sales of Snacks Busy stores nationwide reached 6.445 billion yuan, a year-on-year increase of 139.7%, with average daily sales per store hitting 13,000 to 15,000 yuan.
He stated that currently, excluding store rent and transfer fees, the initial investment for a franchisee is about 500,000 yuan. Given varying operational conditions, the payback period differs, but “the average payback period is about 1.5 to 2 years.”
In fact, because bulk snack stores like Snacks Busy focus on affordable leisure snacks, franchisees' gross margins are not high. According to Snacks Busy, the comprehensive gross margin for its stores is around 18%.
If we crunch the numbers based on the above data, the profitability of bulk snack stores is indeed impressive: with daily sales of 13,000 yuan, monthly sales reach 400,000 yuan, and an 18% gross margin yields about 73,000 yuan. After deducting labor costs (5 employees at 4,000 yuan each per month, totaling 20,000 yuan), rent for a 100-square-meter store (15,000 yuan), and utilities (5,000 yuan), the net profit per month is around 30,000 yuan.
In an ideal scenario, such a return on investment is “sexy.” But more often, the battlefield franchisees enter is far more brutal.
A franchisee of a snack brand shared their failed entrepreneurial experience on social media, saying the brand claimed daily sales of 8,000 to 11,000 yuan per store, with gross margins of 15% to 20% and net profit of 8%. However, in reality, while the store initially attracted a large customer flow due to low prices and curiosity, with daily turnover exceeding 10,000 yuan, sales began to decline over time, dropping to anywhere from a few hundred to a few thousand yuan per day. With an initial investment of 500,000 yuan, the payback period stretched to 3.5 years.
Similarly, another bulk snack store entrepreneur shared that after investing 500,000 yuan, the store initially earned 6,000 to 7,000 yuan per day, but soon sales fell to 1,000 to 2,000 yuan, and at the lowest, only a few hundred yuan a day. “The store relied on thin margins and high volume, but now revenue isn’t even enough to pay employees. I had to close the store within a year,” he lamented.
The franchisee attributes this failure primarily to the increasingly fierce competition.
“In the past year or two, many entrepreneurs have been aggressively opening discount snack stores offline. There used to be just two stores on this street, but now several more have opened. It feels like a contest of who has deeper pockets,” he added.
Indeed, as offline chain snack brands rapidly open new stores, the previously less competitive market is being carved up by more players.
Currently, Snacks Busy claims over 2,000 stores nationwide, but industry insiders say the number is nearly 3,000. Snacks Youming has over 1,000 stores and plans to reach 16,000 by 2026. Zhao Yiming, dubbed “Jiangxi’s snack shop,” announced on its website that it began franchising in October 2020 and is expanding at a rate of over 200 stores per month.
Data from Qichacha shows that over the past decade, the number of new “snack store” related enterprises has been substantial. In 2015, registrations exceeded 10,000 for the first time; from 2016 to 2018, new snack-related enterprises were 13,300, 14,100, and 16,900 respectively; from 2019 to 2022, annual new registrations exceeded 20,000. As of June 13 this year, 11,100 new snack-related enterprises had been registered.
Image / More and more entrepreneurs are jumping in
With too many players and too little meat, profits are diluted, making it harder to earn money and leading to a wave of closures.
Last month, media reported that the popular snack store “a1 Snack Research Institute” closed 80% of its offline stores. In May, the snack brand “Laopo Daren” (Wife) was rumored to be shutting down. Additionally, the discount store Boom Boom Mart declared bankruptcy.
The thin-margin, high-volume bulk snack format sounds appealing and excites investors, but it also plunges the industry into an era of “great turmoil.” The elimination round has already begun.
The Battle Between Old and New Snack Stores
In reality, it’s not just bulk snack stores fighting among themselves. The offline snack market now includes new chains like Snacks Busy and Zhao Yiming, as well as established brands like Three Squirrels and Lai Yifen continuing to deepen their offline presence. There are also large supermarkets, regional supermarkets, specialty stores, and even grocery stores and street stalls. Against this backdrop, where is the breakthrough for bulk snack stores?
For bulk snack store entrepreneurs, the winning formula seems to be going down-market.
“In my view, offline retail stores are still constrained by store models, labor, and rent costs. Take Snacks Busy as an example: our stores are mainly in second- and third-tier cities, even counties and townships. The down-market has huge potential,” said a Snacks Busy representative. In Hunan, for instance, Changsha has over 400 stores, with an average of more than 20 stores across 13 prefecture-level cities, and 70% of townships have at least one store.
Not just Snacks Busy in Hunan, but also Laopo Daren in Zhejiang, Tangchao in Fujian, Zhao Yiming in Jiangxi, and Snacks Youming in Sichuan are all rooting themselves in local down-markets while expanding to surrounding areas, sprouting like mushrooms in county towns.
These new snack forces are disrupting the county snack scene.
In fact, convenience stores often devote half to two-thirds of their space to snacks, and premium supermarkets allocate about a quarter. Convenience stores have traditionally flourished in towns and villages due to their location advantages and low investment. But with the emergence of cheaper bulk snack stores, they are encroaching on the business of convenience stores and mom-and-pop shops.
Some franchisees even say, “Local convenience stores and snack shops are being ‘suppressed’ by bulk snack stores, forcing many to close.”
Fang Xi, who runs a convenience store in a county in Jiangxi, said that in his city of fewer than 400,000 people, there are 7 Zhao Yiming stores, 3 Yadiyadi stores, 3 Suowei stores, and 1 Snacks Busy store.
“Their snacks are not only cheaper than ours, but they also rotate products quickly and have a better atmosphere. Compared to our small store, they sell basically the same snacks, and customers seem to get tired of ours,” Fang Xi told Modern Consumption helplessly. He added that his business has already been affected, and if it weren’t for the differentiation in cigarettes, alcohol, and daily necessities, he might have transferred his store.
However, while the thin-margin model makes bulk snack stores seem “invincible,” it also limits their cooperation with many brands.
On one hand, snack collection store channels are gaining favor among snack manufacturers.
Image / Photo by Shetu, based on VRF license
For example, Yanjin Shop’s 2022 financial report disclosed that among all its sales channels, the Snacks Busy system accounted for 7.31% of total sales, ranking first, even surpassing the combined total of Walmart (second) and Bubugao (third), two traditional supermarket chains.
Qiaqia Food also stated that in early 2023, the company increased cooperation with snack specialty and bulk channels, mainly through direct operations. Currently, it is cooperating and testing products with Snacks Busy, Zhao Yiming, and Snacks Youming, with over a dozen SKUs including sunflower seeds, nuts, and leisure snacks, hoping to bring good growth in 2023.
But at the same time, more brands fear that the ultra-low prices at bulk snack stores will erode the market share of existing channel partners in the same region, causing channel conflicts.
In response, leading snack brands like Three Squirrels and Liangpin Shop told Modern Consumption that they do not cooperate with bulk snack stores like Snacks Busy to avoid price inconsistencies across channels.
Clearly, it’s not easy for new snack forces like bulk snack stores to grow big. They face numerous challenges, from sourcing to sustained profitability. Practitioners must find core competitiveness beyond “low prices” and explore new business models in this new turmoil, or they risk being eliminated in the “too many wolves, too little meat” competition.
Names in the article are pseudonyms.