Before sharing, let me introduce my situation. Tangshan Yihe Service Provider was founded in 2011. Before starting the business, I worked as a factory manager at Yili Dairy, then started a dairy distribution business covering local supermarkets and small stores in Tangshan. In 2019, I began exploring a local B2B supply chain platform, now covering 4,000+ stores with 6,000 SKUs.
In 2021, I extended based on the B2B supply chain to open discount retail stores, and now I have opened 32 community discount supermarkets.
Invited by Yuan Lai from New Distribution, I am sharing some of my insights on opening stores. Previously, I was reluctant to share, worried about misleading fellow dealer bosses. I am still exploring and far from successful. On the other hand, opening retail stores is completely different from trading agency business. Frankly, it is not easy for dealers to open stores well. So in my exchange with Yuan Lai, we reached an agreement.
First, I am not encouraging dealer bosses to open stores, just sharing my experience.
Second, Open a window for dealers. Upstream, midstream, downstream, as long as you are willing to struggle, there is a way.
Third, If dealers really plan to open stores, my experience summary below will definitely be useful.
Opening a store is more arduous than trading agency
Why do I say this?
As a brand agent, you hold it in your hands for five to six years at least, or ten to twenty years at most, following the brand manufacturer to execute. The manufacturer basically solves all complex problems. Even if there are conflicts of interest, they are internal contradictions.
But opening a retail store is in free market competition; no one protects you. At the same time, the work is more complex and challenging.
I joked before that once you do retail, you have to do it for the rest of your life; there is no turning back. Because everyone is competing for business, you can only keep moving forward.
Of course, the value and significance of opening a store are also different. Opening 20-30 stores is truly your own territory, a controllable business. Even better, it can be a business passed down.
In terms of profitability, it is certainly better than trading agency. For example, with 20 stores, average daily sales per store of 12,000 yuan, annual sales of 4 million, total revenue of 80 million. Average industry net profit margin of 5%, 200,000 per store, profit of 4 million.
As I said, the financial model looks good and tempting. But doing this is very draining because opening a store is a process of continuous improvement. If you treat opening a retail store as a side project or investment project today, it will definitely not succeed.
Just investing and supplying goods cannot open a store well
Opening a store has technical content, but nothing is unlearnable. You really need to go all in. Store layout, stocking, hygiene, cashier, lighting, decoration—if you don't fully invest, you can't do it well.
Now opening a store is not like the past, where you find a good location, install shelves, press a batch of dealer payments, and have complete goods to open well. Now almost the entire retail industry is in a state of "adjustment and reform." The essence is that stores are saturated enough; you must shift from quantity management to quality management.
If you want to do it but not do it yourself, just invest money and supply goods, it won't work. The people you assign or the store managers you hire may have an employee mentality.
For dealers opening stores, such entry-level novices, and then managing investment to open stores, definitely won't work.
People who love opening stores are the first priority
Let me share why I opened stores after doing B2B supply chain?
The business logic is not extended. The initial push to open stores did not come from me but from a team member.
There was a partner in my team. Before opening the store, almost everyone in the company knew that this partner's dream was to open his own store. He had an absolute obsession with opening a store.
When the first store location was confirmed, I joked that he treated the store like his child. He had no experience at all, didn't know decoration, goods, shelves. He had no choice but to copy other stores, find resources and connections, and follow the decoration team.
I remember a few days before the first store opened, the daily turnover was only 1,000-2,000 yuan, business was bad. But our partner shared with the team every day that some customer thought our store was great, bright, clean, hygienic...
Why did he say that? The core meaning was: he didn't want me to close the store, he wanted to continue.
If you don't love it, but are just assigned by the boss, and the boss gives you a safety net, this will definitely not succeed. Opening a store is almost year-round, long working hours, and you have to worry when the store is open.
If a dealer really wants to open a store: either you love opening stores yourself and see through the trading business; or someone you trust (like your children) is very enthusiastic.
It is recommended not to assess with financial indicators in the early stage, and fully authorize.
Work as a store clerk in someone else's store for 3 months
When you decide to do it and know what type of store you want to open, extend the research period. Don't start immediately.
I once communicated with a boss who opened a chain of restaurants. He shared an experience that I found useful: 3 people each find 3 Chaoshan beef hotpot restaurants, apply for 3 different positions, each work for 3 months, learn all the experience, even pay double wages, and then come back to open their own hotpot restaurant.
No matter how well you talk, you must go down to the field. By working as a clerk for 3 months, you build a sense and cognition, which is very useful for novices.
Optimal store type: 60m2-200m2 community supermarket
Based on my current practice, the best store type is: offline snacks + (eggs, milk, frozen, refrigerated, short-shelf-life food + a small amount of rice, flour, oil, grain, paper hygiene, and some trendy toys), plus online community group buying, fruits, vegetables, seafood, next-day delivery.
Here I emphasize: don't do daily chemicals, personal care, grain, oil, and condiments. A small amount of paper hygiene and grain, oil, rice, and flour is enough. From practice, daily chemicals and personal care turn over too slowly. Grain, oil, rice, and flour are still the business of supermarkets and agricultural trade; you can't compete.
In terms of retail prices, benchmarking against money-saving supermarkets (Zhao Yiming, Laiyoupin), the comprehensive gross margin is expected to be around 15%-20%.
Don't be afraid to close a store after opening
Change the store but not the person. Even if decoration costs 100,000, waste is waste, don't be nostalgic. What is our standard for closing or changing stores?
It's not about foot traffic, but whether competitors have opened nearby.
Share a case: About two years ago, I opened a store. I thought it was an excellent location with good foot traffic. Also, from a competitive perspective, I thought the density of surrounding shops and business conditions made it impossible for two more snack stores to open.
Who knew that after half a year, two milk tea shops opposite merged and directly opened a Haoxianglai (a snack chain under Wanchen Group) with a larger storefront and area. At that time, I wanted to fight hard, thinking "leaving too fast is too embarrassing." But now I think it would have been better to leave earlier and faster, at least losing less.
Now the lesson learned is: once later competitors (mainly national chain brands) enter your covered business circle, quickly calculate. If sales drop by 30%, withdraw immediately.
Once you open a store, don't be afraid to close it. Close and reopen; this is the norm in retail operations.
Early stores must be decided by the boss personally
In the early stage of opening stores, we had no professional development staff, only the boss personally. I drove around every day, and when I found a good location, I found the phone number and called. The first 2-3 stores must be decided by the boss personally. If not, you don't have the "feel," and decision-making requires courage.
Previously, we tried to give 2,000-3,000 yuan rewards to salespeople to find stores, but it was useless; their energy was not there.
To do this well, you must personally go out and find.
Go where there are many supermarkets
After 4 years of store opening experience, we have 5 detailed lessons about site selection.
First, places with too many empty stores must not be opened. The emptier the store, the less you want it. The fewer stores, the less you go. Don't think about "turning the tide."
Second, don't open directly at the main gate of a school campus (it's a gathering place, not a stay place).
Third, go where there are many supermarkets.
Fourth, large communities, inner streets are also okay. With the planned point as the center, within a radius of 300-500 meters (extreme walking 10 minutes), can cover 3,000 households or 10,000 people.
Fifth, "remote places" in busy areas. Busy areas are where foot traffic concentrates, with many target consumers. For example, around universities, large residential areas, core business districts, etc.
"Remote places" are where consumers must pass to go to busy areas. Close to consumers, but costs are not high, and importantly, transportation and parking should be convenient.
Product organization: copy first, then modify
First copy. Any system store that has become a chain system, with more than a few hundred stores, its product structure must have been polished.
For beginners, first learn from excellent peers and copy a set of goods.
After having a basic product range, slowly optimize product selection based on local consumer habits. Look at what the best local supermarkets sell, what products consumers like, and then replicate differentiation. Retail is a meticulous job; you have to slowly change and adjust.
For example, if a supermarket sells 250ml Zhenguoli well, it shows consumers recognize the product, so you can choose the 100ml specification, which fits the snack store logic and is recognized by consumers.
Regarding prices, taking an active snack store as an example, a single store has about 1,300 SKUs, of which 800 are fixed and 500 are bulk. 35% of products cooperate directly with brands, which itself has a price advantage.
The other 65% of products, through supply chain optimization, no after-sales, no returns, directly to the big warehouse, no need for delivery to the store, by removing subsequent service and logistics costs, can also achieve price advantages.
Location is a scarce core resource
This is the tenth experience I share
I shared earlier that stores are a business that can be passed down.
Why can it be passed down? Because good locations are definitely scarce. And as dealers, we know local location resources best.
Today Haoxianglai is good, so I join Haoxianglai. If Haoxianglai fails, I switch to Zhao Yiming; if Zhao Yiming fails, I switch to Luckin Coffee...
We see many Baiguoyuan and Luckin Coffee stores in the city, behind which are retail brand agents. Find projects to join, constantly change projects. Behind the project, the location of this store is the core competitiveness and core resource.
Dealers deeply cultivate the local area. Through covering store sales data, they actually know local location resources best. Dealers have two inherent advantages in opening stores: first, they know the business conditions of local business circles best; second, they have a set of goods on hand, especially snack food dealers.
Finally, I want to share why I open stores? Because a dealer opening a local chain snack store is often considered a bit unprofessional.
First, dealers have always only done the supply segment, the middle link. But with the development of the industry, retailers have internalized dealer functions. The direct procurement and naked procurement under supermarket adjustment are the most direct manifestation.
In the future, the survival space of dealers will be severely squeezed. Whoever is close to consumers survives, and the most direct way is to open stores.
Second, I have calculated. Combining the advantages of B2B supply chain to open community discount stores, and then replicating, this business model is viable.
Third, if you have 20 stores, with an average of 10,000 per store, that's 6 million a month, annual sales of 72 million. If you do the same 72 million trading agency business, comparing, obviously 20 stores are more valuable. And the future imagination space is bigger. What about 200 stores? Brand premium and market voice are completely different.
Finally, I want to emphasize again that opening stores is not a must for dealers, but an option.
The direction of dealer transformation is never single. The key is to find a path that suits you. In the past few years, New Distribution has seen many successful cases, including those who opened retail stores, did B2B supply chain, did category operations, gift box customization operators, etc.
In August, in Shanghai, at the 2025 [New Demand · New Supply] 7th China FMCG Conference and the 5th China FMCG Dealer Conference, we invited benchmark cases of transformation in different directions:
Representatives of supply chain & retail stores - Chen Jianfu, General Manager of Jiayuan Convenience and Vice President of Hubei Shoukang Yongle Trading Group; Regional B2B platform representative - Zhong Xiaoping, General Manager of Jiecang Wangou; Representatives of regional category operators and retail channel operators - Zhang Shicheng, General Manager of Tianjin Shicheng Bofa, Zhang Gaifeng, General Manager of Zhengzhou Dapeng Trading, and Li Fen, General Manager of Xuzhou Runzhong Supply Chain, etc.
Together, we will discuss how dealers should go, how to transform, and how to win in the market environment of new demand and new supply.
At the same time, at the conference site, we will also release the industry-exclusive "2025 China FMCG Dealer Business Condition Survey Report" to see who is growing and who is being eliminated among dealers this year. What are the reasons for growth? Where is the focus of operations?
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