Several sets of 2015 annual report data 1 Sun Art Retail is China's largest hypermarket operator, operating hypermarkets under the well-known brands "Auchan" and "RT-Mart". As of December 31, 2015, Sun Art Retail had 409 comprehensive hypermarkets nationwide, with a total building area of approximately 11,125,268 square meters. On the evening of February 28, Sun Art Retail released its performance report, which showed for 2015:

  1. Opened 38 new stores during the year, of which 36 were comprehensive hypermarkets and two were supermarkets.
  2. Turnover was RMB 96.414 billion, an increase of 5%.
  3. Gross profit was RMB 22.463 billion, an increase of 7.0%; gross margin was 23.3%, up 0.4 percentage points.
  4. In the first half of 2015, Feiniu.com achieved nationwide coverage through the "store O2O" delivery of the group's physical retail stores in 24 cities across the country, making Feiniu.com the first e-commerce company to cover the whole country in its second year of establishment.
  5. There were 409 stores nationwide, and 117 locations have been reserved for opening comprehensive hypermarkets in the next three years, of which 77 are under construction. Same-store sales — For the year ended December 31, 2015, same-store sales growth was -3.6%, compared to -1.6% for the year ended December 31, 2014. The decrease in same-store sales growth was mainly due to the slowdown in overall consumer market growth, the diversification of customer channels, and intense competition among different retail channels. Note: Same-store sales growth: Calculated by comparing the sales of comparable stores (those open for more than twelve full months as of December 31, 2015) from the month of opening to the end of 2014 with sales for the same period in 2015. 2 Renrenle Chain Commercial Group Co., Ltd. recently released its 2015 annual performance express report: In 2015, the company achieved operating revenue of RMB 11.218 billion, a decrease of 7.42% compared to the same period last year; operating profit was -RMB 337.4588 million, a decrease of 36.53% year-on-year; total profit was -RMB 436.4638 million, a decrease of 18.56% year-on-year; net profit was -RMB 465.4329 million, a decrease of 1.07% year-on-year. During the reporting period, in order to reduce the impact of loss-making stores on the company's performance and strategic transformation, the company closed 11 stores in 2015, which had a significant impact on the 2015 operating results. 3 New Huadu: New Huadu Shopping Plaza Co., Ltd. also recently released its 2015 annual performance express report. In 2015, the company achieved total operating revenue of RMB 6,487.7185 million, a decrease of 7.56% compared to the same period last year, mainly affected by the weak macro economy, sluggish industry conditions, e-commerce impact, and store closures. During the reporting period, net profit attributable to shareholders of the listed company was -RMB 387.3726 million, a decrease of 1155.70% compared to the same period last year, mainly due to declining turnover, rising labor and other expenses, and losses from closing some severely loss-making stores. What problems do we find from the above data? In the annual reports of these three companies, we clearly find: 1. Operating performance declined compared to the same period in 2014; 2. Store closures accelerated, and new store openings slowed down; 3. Affected by the macro environment and e-commerce impact! The fundamental problem is: declining turnover and increasing store closures are now plaguing comprehensive hypermarkets! Author's Viewpoint The author believes that e-commerce impact is only one aspect; the most important thing is that consumers' shopping habits are changing. Chinese consumers are becoming increasingly "lazy", and their shopping purpose is becoming stronger, rather than impulsive shopping; planning is becoming stronger. For comprehensive hypermarket channels, many young people go only a few times a year, because after 15 years of rapid development of hypermarkets, Chinese consumers have realized that most of the time spent in hypermarkets is looking at things they don't need. Therefore, the author firmly predicts: in the next 5-10 years, the large and comprehensive modern hypermarket channel will become increasingly difficult, facing industry consolidation. Similar to the dairy and beer industries, only a few oligarchs will remain in the large and comprehensive modern hypermarket sector, and most comprehensive hypermarkets will transform into specialty product chains. What is a specialty product chain? The author believes that consumers will go to such product-concentrated chains to purchase a specific category of goods. Currently, many such specialty chains have already appeared in first-tier cities like Beijing, Shanghai, Guangzhou, and Shenzhen, such as Decathlon for sporting goods, Mommy Baby and Goodbaby for maternal and infant products, Liangpin Shop for snacks, Easyhome for home furnishings, 1919 for liquor, and CITYSHOP for high-end imported products. These specialty chains are accelerating their store openings, and their annual growth is astonishing. Let me give an example of Decathlon: Despite the sluggish overall retail market in China, it has not affected the expansion momentum of French sporting goods retail giant Decathlon in China. According to official data, as of October 2015, Decathlon had entered 60 cities in China and opened 135 stores. It is worth mentioning that in 2014, Decathlon China opened 32 new stores, ranking first globally in the group. In 2014, Decathlon China achieved revenue growth of 46%. "Decathlon's sales have grown by more than 40% for three consecutive years," said the above-mentioned person in charge. This year, Decathlon's plan to open 50 new stores in China can be completed without any suspense. In other words, by the end of this year, the total number of Decathlon stores will reach 160. In the future, Decathlon's goal is to enter 120 cities in China and have 500 physical stores in five years. On the one hand, comprehensive hypermarkets are experiencing negative growth; on the other hand, specialty chains like Decathlon are experiencing continuous high-speed growth. This illustrates the point. Therefore, for those companies and distributors that are about to open or enter the modern comprehensive hypermarket channel, the author wants to pour cold water on you. Please consider carefully before deciding whether to enter! Hu Wei, pen name Jing Bozi, born in Jiujiang, currently living in Beijing, graduated from Nanjing University of Finance and Economics, practical marketing expert in FMCG, partner and chief marketing consultant of Shanghai Lixi Culture Communication Co., Ltd. He is a special contributor to domestic well-known marketing magazines and journals such as "Sales and Market", "China Wine News", and "Pharmaceutical Economic News". He is good at using Taoist Huang-Lao theory to create the "Six Hearts" management theory for building core sales teams. He focuses on differentiated marketing, channel incentives, and regional market breakthroughs for food and beverages. He has held positions such as Product Director and General Manager of Guangdong Region at Huiyuan Juice Group, Marketing Director and Marketing Director of Northern Region at Hunan Taizinai Group, Marketing General Manager at Jiangxi Gaozheng Group, and Deputy General Manager of Marketing at Duoduo Runer Company. This platform will soon organize several experience-sharing salons titled "How Distributors Should Operate B2B". We will invite some domestic distributors who have actually operated for a period of time to share their experiences and discuss how they operate in their local markets. Interested distributors can long-press the QR code below to add the author's WeChat to participate in the sharing and exchange: When adding, please reply with the keyword: 操盘 - END- The best domestic FMCG distributor learning platform Dedicated to providing professional, practical, and applicable tutorials for companies and distributors Committed to helping Chinese FMCG distributors grow rapidly The most professional and practical knowledge base in the FMCG industry Reply with the red number below to get the corresponding content Reply with number 1 to view the complete knowledge base | 001 Excellent article selection | 002 Distributor market operation | 003 Terminal visit management | 004 Sales supervisor skills | 005 Sales improvement techniques | 006 Channel expansion | 007 Managing distributors | 008 Distributor development | 009 Distributor internal operations management | 010 Team management | 011 Efficient distribution techniques | 012 Sales manager's eighteen skills | 013 KA operation methods and strategies | 014 First lesson for new salespeople | 015 Internet, brands | 016 Distributor B2B transformation | [Long press QR code to follow]