---
title: "The Mom-and-Pop Stores Swept by the Times: Do They Still Have a Chance to Turn Around?"
description: "Mom-and-pop store owners must be able to sail with the wind and also rise against it; staying still is like a fish in a dried-up rut, and it will eventually capsize. The pandemic has been a great filter, eliminating many poorly managed businesses, including countless mom-and-pop stores in the FMCG industry. As Francis Fukuyama said, every grain of dust from the times falls on individuals as a mountain. Now that the pandemic is easing, can these stores revive?"
author: "赵胜男"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2023-01-17"
language: "en"
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original_source: "https://mp.weixin.qq.com/s/dunKuFfARTqAQVjw4oEXWQ"
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# The Mom-and-Pop Stores Swept by the Times: Do They Still Have a Chance to Turn Around?

> Mom-and-pop store owners must be able to sail with the wind and also rise against it; staying still is like a fish in a dried-up rut, and it will eventually capsize. The pandemic has been a great filter, eliminating many poorly managed businesses, including countless mom-and-pop stores in the FMCG industry. As Francis Fukuyama said, every grain of dust from the times falls on individuals as a mountain. Now that the pandemic is easing, can these stores revive?

**Introduction**: Mom-and-pop store owners must be able to sail with the wind and also rise against it; staying still is like a fish in a dried-up rut, and it will eventually capsize.

The three years of the pandemic have been like a great wave sifting out waves of poorly managed merchants, including the mom-and-pop store owners closest to consumers in the FMCG industry. This echoes Francis Fukuyama's words: every grain of dust from the times falls on each person as a mountain. When the environment is good, even novices can get a share, but when it's bad, even seasoned owners may be crushed. Many are even saying: cherish the small shops at your doorstep, for they might disappear one day! Now that the mountain of the pandemic is gradually lightening and the economy is easing, can those mom-and-pop stores that held on with their last breath make a full recovery? To better understand the market environment, New Distribution recently interviewed a large number of mom-and-pop store owners.

**Multiple Pressures, Struggling Operations**

"The pandemic has been lifted, but business hasn't improved significantly; it's still as bleak, and I don't know if I can hold on until the economy fully recovers," said Zhang Tao (pseudonym), a store owner in Xuzhou, helplessly. While checking near-expiry goods, he added, "Previously, I never worried about selling; as long as the shelves were full, the daily turnover was large. Now, except for cigarettes and alcohol, other goods aren't moving well."

Similarly, Wang Ce (pseudonym), a small store owner near a central elementary school in Jinan, complained, "My main customers used to be elementary school students. Now that the pandemic has been lifted, many students are infected, and schools frequently suspend classes. I can barely afford the rent."

Zhang Tao and Wang Ce are not isolated cases. The difficulties facing mom-and-pop stores go beyond the pandemic's force majeure; two other factors are eroding their business.

First, O2O instant retail has "officially" entered the game. Although O2O has been around for a while, it truly gained popularity during the pandemic. The pandemic not only temporarily restricted people's freedom but also drove a shift in consumption habits. After all, who can resist a platform that delivers to your door with a few taps when you can't leave home? In this context, the channel landscape is quietly changing, with O2O instant retail aggressively carving up physical store business.

According to the "2022 China Shopper Report, Series II" jointly released by Bain & Company and Kantar Worldpanel, among the four types of O2O instant retail platforms, community group-buying platforms represented by Meituan Maicai and Duoduo Maicai saw their share of total instant retail channel sales rise from 39% in 2021 to 46% in 2022, firmly ranking first. In 2022, sales grew 17% year-over-year. Categories such as frozen foods, toilet paper, and facial tissues performed prominently, with significant growth in instant retail channel penetration.

Second, the encirclement by chain convenience stores. The struggle between mom-and-pop stores and chain convenience stores has been ongoing for a long time. According to data from Tianyancha, the number of newly registered convenience store-related enterprises in China exceeded 250,000 in 2021, showing steady growth over the past decade. In 2021, 69,000 new supermarket convenience stores were added nationwide, bringing the total to over 190,000. Well-known brands have significantly increased their store counts. For instance, Meiyijia added over 1,600 stores, Lawson nearly 550, 7-ELEVEN 240, and Bianlifeng over 400. Where there is aggressive expansion, there will be shrinkage, because China has entered a stock market. The unbridled growth of chain convenience stores is partly built on eroding the business of mom-and-pop stores. The foot traffic in mom-and-pop stores is visibly declining, especially in first-tier cities.

Under multiple pressures, it seems that bleak business for mom-and-pop stores should be the norm, as if "when the nest is overturned, no egg remains intact." But will all mom-and-pop stores wither and decline in this scenario? Are there stores that can break through and keep business thriving? The answer is definitely yes!

**Some Stores Thrive Even in the "Winter"**

While poorly managed owners lament their fate, some owners have overtaken on the curve and achieved rapid growth. Wang Cheng (pseudonym) is one such small store owner who has achieved rapid growth. This year marks his 21st year in business. Even before the pandemic, he sensed subtle changes in the channel, with sales slowly declining. As mentioned earlier, O2O business is carving up physical store business. A small store owner with limited resources cannot fight head-on; rather than waiting for business to be taken away, it's better to join them, as the saying goes: "If you can't beat them, join them." So, the foresighted Wang Cheng started operating community group buying in 2019, diving into O2O. Wang Cheng said, "At first, I didn't even know how to use the software; it took a lot of determination. Later, although I became a group leader providing vegetable pickup services for neighbors, the income was small. Fortunately, the store's foot traffic increased, and some people would buy a pack of cigarettes or a drink when picking up vegetables. Also, the customers picking up vegetables were usually from nearby neighborhoods. I would add their WeChat to a group and frequently post special offers from the store, including wontons, dumplings, and pastries I made myself." At this point, Wang Cheng picked up a pack of wontons not yet delivered and said, "Things like wontons and dumplings are very popular among young people from other places. We make them fresh, and they taste much better than frozen ones. As long as you purchase over 50 yuan of goods, we offer free delivery." With this foundation, when the pandemic hit, Wang Cheng's business was even better than usual, completely unaffected. Even now, his business remains strong.

When asked about the pressure from chain convenience stores, Wang Cheng said there's nothing to fear. After all, China is a society of relationships. Convenience stores only provide quick transactions, and the service attitude of hired staff varies. Mom-and-pop stores may not be as modern, but the warm service of the owners is something chains can't match. Compared to cold transactions, the heartfelt service of mom-and-pop stores touches people more.

**A Promising Future**

Nowadays, more and more shopping methods are emerging, and some mom-and-pop stores are stuck in the past, aging, and no longer favored by consumers. Especially with the business reshuffling in recent years, more and more people have lost confidence in mom-and-pop stores. It's okay to have a sense of crisis, but there's no need to lose all confidence, because demand always exists. China is densely populated; wherever there are people, there is a need for daily necessities. Mom-and-pop stores typically serve a radius of a few kilometers, with dispersed layouts, long business hours, and close proximity to consumers. For decades, they have provided resources to surrounding residents. Over time, mom-and-pop stores and the surrounding floating and permanent populations have become interdependent. People need this convenient small shop, which cannot be replaced by hypermarkets or modern chain convenience stores.

According to data from the China Chain Store & Franchise Association, in recent years, community consumption in China accounts for 20% of total urban retail sales of consumer goods, while in developed countries, this proportion is around 40%. Communities are full of mom-and-pop stores. During the pandemic, people's needs did not disappear; only the demand fluctuated. It depends on whether the owner can seize the stock market.

Think back to the earlier examples: some small store owners are on the verge of closing, while others are thriving. What's the problem behind this reversal? Setting aside objective factors, most owners on the verge of closing share a common flaw—sticking to old ways. These owners can almost be described as "unambitious." It's common for them to scroll through Douyin from morning to night with the volume maxed out, sometimes requiring customers to shout to get their attention. They are rigid, unwilling to accept new things, and just stick to their own small patch. Their accounts are unclear; they have no idea how much they earn or lose in a year, thinking it doesn't matter since it's their own business, at most they can sense the foot traffic. They never self-reflect, simply blaming their poor business on bad luck. Even if it's tough, they want to hold on, believing that once the market economy recovers, they will recover with it.

The idea that "he who holds on to the end is the king" is not wrong, but with such an attitude, will they really see the clouds part and the moon shine? Not necessarily. Today's market environment is fiercely competitive. Small store owners must be able to sail with the wind and also rise against it; staying still is like a fish in a dried-up rut, and it will eventually capsize.

On the other hand, owners with thriving businesses are mostly those who can rise against the wind. For example, Wang Cheng combined his traditional store with modern methods, catching the fast train of the times, and successfully resisted the "pandemic winter" through community and social group operations. Wang Cheng's success story is just a microcosm of thousands of owners who dare to break through. Their changes may not necessarily be joining O2O, but they are all actively embracing new things. These small stores may not be large, but they are highly flexible. As long as they keep learning and keep up with the times, they may not become extremely strong, but at least they will thrive in their own areas.

In summary, while the environment has some influence, the ultimate fate is in the hands of the owners themselves. Keeping pace with the times and diligent learning are fundamental; unambitious mom-and-pop stores will gradually be eliminated. At the same time, due to their flexibility, as long as they recognize their problems in time, they still have a chance to turn around. Those mom-and-pop stores that can follow the pace of the times and survive are promising for the future.


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