As a third-generation merchant, Ge Peng took over the family rice business from his father. Facing the ever-changing internet environment, he felt the pain of brand owners and distributors transitioning their businesses and clearly understood the need to explore new models. Two years ago, Ge Peng began cooperating with JD New Distribution's joint warehouse, which initiated the digital transformation of his traditional business, establishing an efficient and transparent distribution channel and achieving an increase in online annual sales from 0 to over 100 million yuan.

-01- Seven-Year Itch, Crises Arising

▲ Guojing Rice Industry Warehouse

If it hadn't been for an event he attended two years ago, Ge Peng would never have imagined that his struggling Guojing Rice Industry brand distribution business would find a new way out.

Ge Peng, born after 1985, is also a standard "third-generation merchant." "My grandfather started in the grain and oil business in Anhui from the beginning of reform and opening up, initially in grain trade; it wasn't until the 1990s that my father began grain processing, and then expanded step by step."

In 2011, in Huainan City, Anhui Province, a grain industrial park covering 30,000 square meters was built. Ge Peng's family business expanded from his father's grain processing to the entire industry chain from planting, storage, processing, to sales, and rice sales expanded from Anhui to the whole country.

After seven years of development, Guojing Rice Industry's business scale has been expanding step by step, but problems also constantly challenged this third-generation merchant: "Our own rice brand goes through traditional distribution channels, and now many problems have emerged. For example, we want to deepen our presence in Shenzhen and also open up surrounding blank markets, but building this distribution system is very difficult." Ge Peng felt the pressure and expectations of being a third-generation merchant. "I also want to establish my own channels, but I know the resources invested will be huge and the results will be slow."

Ge Peng was looking for opportunities.

-02- Building a Distribution System: From 0 to Annual Sales of 100 Million Yuan

▲ Joint Warehouse Boss Ge Peng

The opportunity appeared at the New Distribution joint warehouse recruitment conference that Ge Peng attended. Ge Peng said, "Listening on site, I knew this model would work—online, with channels, and the entire channel is standardized and transparent..."

In May 2018, Guojing Rice Industry began cooperation with New Distribution. Half a year after cooperation began, the first offline ordering meeting was held. Ge Peng said, "On the day of the event, on-site sales were nearly 2 million yuan, and it was also the first time we adopted a combination of online and offline forms." The second ordering meeting set a new historical high with sales of nearly 6 million yuan.

Speaking of the most impressive things in the cooperation, Ge Peng said that it was not only the diverse online and offline marketing tactics, such as ordering meetings, coupon distribution, order rebates, purchase gifts and discounts, and terminal customer display rewards; but also, based on the high traffic and strong exposure of the JD Zhangguibao APP, their products could directly reach store customers and regional customers, rather than relying solely on traditional offline distribution channels as before.

In addition to expanding into blank markets, deepening market presence has also been Ge Peng's long-standing wish. Through the distribution agent service on the New Distribution platform, Guojing Rice Industry recruited 7 brand agents, successfully expanding the market from Shenzhen's local area to other regions.

"Customers also expanded from grain and oil stores to convenience stores, supermarkets, KA outlets, catering channels, etc., which immediately opened up our customer base and also covered markets outside Shenzhen." This also achieved a win-win situation for brand owners, agents, and terminal stores. A Dongguan distributor, through JD New Distribution, became an agent for the Guojing Rice Industry brand, and its annual revenue increased by 18 million yuan.

Ge Peng said, "With the help of JD New Distribution's platform to integrate activity resources, systems, and teams, we built a complete distribution system, and through this system, we achieved a breakthrough in online business from 0 to monthly sales of 10 million yuan, and customer numbers also increased by 70%."

-03- Efficiency Improvement, Management Quality Enhancement

▲ Fully Automatic Packaging Production Machine in Warehouse

In addition to building the distribution system and expanding the online market, Ge Peng also felt changes in management improvement. "This not only refers to managing people, but also managing business and resources."

Since the cooperation began, New Distribution's local customer managers have regularly provided systematic and sales-related training to Guojing Rice Industry's sales staff every month, and also visited customers offline together with the sales staff. In addition, nearly 100 sales staff from the company and its subordinate distributors have used the JD Ground Service APP, achieving information-based management of frontline sales personnel, improving efficiency and making it more convenient and transparent.

Moreover, the inventory, order, and distribution data provided by the merchant backend have enabled Ge Peng to clearly conduct business analysis and formulate marketing strategies, truly realizing the transformation from traditional offline business to data-driven operations. Ge Peng said, "Now the channels are more transparent, and terminals are more controllable, which greatly reduces the management difficulty of business in other regions."

During the epidemic this year, Ge Peng knew that rice was a market necessity. To ensure consumer demand, he decided to resume work at the joint warehouse at the end of January. Ge Peng said that although he was worried that some channels might take longer to recover, he would continue to work with New Distribution to develop platform-exclusive customized products based on different customer needs and continue to expand the product distribution network, "continuing to do the new business of a third-generation merchant well."

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