A Brief History of Informatization in the Chain Supermarket Industry As is well known, before the reform and opening up, the basic form of retail in China was counter sales. Older friends may still remember that inventory management relied on ledgers, settlement accounting on abacuses, and customer payments at the counter. A wire with a clip, holding the sales slip and thrown with force, was the rapid information transmission channel between the sales counter and the cashier counter. This period can be called the "prehistoric era" of China's commercial informatization civilization—there was almost no informatization application at that time. The true informatization of the chain supermarket industry developed along with its business progress. After the reform and opening up, due to the rapid improvement of the economic situation, the consumption enthusiasm of the Chinese mainland people burst forth, and new foreign business forms quickly appeared in China. By 1995, modern supermarket formats had appeared in major cities across the country. "No grocery store ever fails to open" and "sell goods like a mountain" were still retail bibles. The large number of orders generated by open-shelf sales gave birth to the initial POS applications; the POS system greatly improved cashier efficiency, making it possible for a supermarket to settle thousands or tens of thousands of customer receipts daily. After that, department-level applications such as inventory management, procurement management, and financial management were born one after another. I think everyone can still remember that "financial computerization" was once a national hot word. The decade from 1995 to 2005 was a period of rapid development for China's "modern channels." Opening a store to make money was the consensus of the entire market. Major supermarket chains opened stores recklessly, and quickly occupying more market share was the industry theme at this stage. Foreign-brand supermarkets and domestic-brand supermarkets competed on the same starting line. As advantageous regions and store locations were gradually occupied, store density increased, and extensive growth became unsustainable. Later, large-scale aggressive growth ended, and the entire industry was about to enter a stage of refined product operation, lean on-site management, and supply chain optimization aimed at improving personnel efficiency, floor efficiency, and customer shopping experience. In developed countries such as Europe and the United States, business and technology upgrades in the chain supermarket industry were already widely promoted and had achieved remarkable results. Under these circumstances, ideas such as refined product operation, intensive on-site operation, and lean supply chain operation gradually became the theme of modern supermarket retail management. Retail ERP systems based on supporting efficient supply chains and breaking down department-level application barriers began to step onto the historical stage and became widespread across the industry. Before 2010, for supermarket chain enterprises, there was a classic "four-step competition theory" in the theoretical circle, which was: first, network expansion competition; second, supply chain advantage competition; third, product and management differentiation competition; fourth, customer relationship management competition. According to this theory, the informatization development route of Chinese chain supermarket retail enterprises should be (as shown in the figure below): √ Popularize retail ERP systems to eliminate information islands in regions, formats, and even business departments; √ Integrate supply chain service systems (SCM, WMS, TMS, VSS or VRM, etc.) to optimize and collaborate on the supply chain; √ Some peripheral systems, such as merchandise resource planning (mRP), shelf planning (Spaceman), electronic shelf labels, and smart shelves for refined product operation, and mobile application systems (such as mobile store) to improve store on-site management and operation efficiency, etc.; √ CRM systems to enhance customer experience before, during, and after purchase, and differentiated services. Before 2010, China's supermarket chain industry informatization basically followed this path (for example, Suning's ERP system upgrade in 2005, China Resources Vanguard's U51 launch in 2006, and Wumart's ERP system switch in 2007). At that time, the industry's ERP had just been popularized (including domestic practical ERPs and international high-end ERPs), ending the history of department-level information islands, but still requiring in-depth optimization and functional improvement and upgrades. Supply chain management and service systems had just been established in some large and regional leading enterprises (such as Wumart's subsequent logistics distribution system construction and China Resources Vanguard's nationwide supply chain optimization). The CRM system for customer relationship management had the worst application foundation. Except for a few membership-based enterprises (such as Ningbo Sanjiang), the membership management of traditional supermarket retail was basically zero at that time. The Informatization Dilemma of the Retail Industry in the Mobile Internet Era Since 2010, surging online business has impacted traditional offline supermarket business wave after wave. Both average transaction value and customer traffic began to decline, and traditional supermarket chains generally felt a chill. From then on, the management teams of every traditional supermarket enterprise unanimously shifted their attention to how to respond to e-commerce impact and use e-commerce channels for customer attraction and marketing, while the themes of refined product operation, intensive on-site management, and supply chain optimization system upgrades and improvements gradually cooled down. Especially after 2013, the rapid development of mobile e-commerce made the double decline of transaction value and customer traffic worse for traditional supermarkets. Almost all retail enterprises no longer considered ERP upgrades and optimization or the construction of peripheral systems. Under the condition of arrears in basic management system upgrades, they began to introduce e-commerce systems on a large scale and actively explore O2O business. After 1-3 years of difficult exploration, the omni-channel business model of traditional chain supermarkets gradually became clear. Omni-channel retail and O2O business collaboration became a consensus. The demand for core business systems based on the omni-channel business model, that is, systems aimed at seamless collaboration between online and offline business, was very strong in 2014-2015. When traditional core business systems could not support O2O business, and the cost of switching the entire core business system was extremely high in terms of funds and learning, a solution to build an "omni-channel retail marketing middle platform system" on top of the existing traditional core business system emerged as a stopgap measure. However, traditional supermarket chains encountered obstacles everywhere in the process of omni-channel upgrade and transformation: the traditional core business system architecture, due to technical reasons, could not fully support the frequent online and offline business processes in O2O business, and the response speed to system optimization and upgrade changes caused by omni-channel business needs was extremely slow; at the same time, the shortcomings of extensive management in basic business were amplified by online business, such as inconsistency between system inventory and actual inventory, and the inability to synchronize online and offline inventory, prices, and product status in real time. A large number of practical problems restricted the promotion of seamless online and offline business collaboration. At this time, retail enterprises realized that they must optimize and upgrade the core business system as a whole to solve these basic problems. In the past two years, when discussing omni-channel solutions with traditional retailers, whenever encountering unsolvable problems between heterogeneous systems, the other party would basically ask: "Why don't you replace our ERP as well?" Although they eventually gave up due to system switching costs and other reasons, seeing one spot is enough to see the whole leopard. The backward technical architecture and primitive state of performance and functions of traditional retailers' systems are the biggest system obstacles to building an omni-channel operation model. Especially for some regional small and medium-sized enterprises, they lack sufficient funds, technical strength, and project operation experience to carry out internet-based transformation of their core business systems. The backwardness of traditional chain supermarkets' core business systems is not only reflected in the lack of functions in supporting online and offline business collaboration, but also in the fact that their old system architecture cannot support complex, changeable, and time-sensitive online business, nor can it handle system rule configuration for multiple online channels. Therefore, traditional chain supermarkets, especially small and medium-sized retail enterprises, urgently want to change the current state of their core business systems. They urgently need a complete set of system solutions that can smoothly switch existing business with complete project experience, cover existing core business systems at low cost, and avoid business turbulence. Beneficial Explorations Made by the Industry to Address the Dilemma To address the industry's informatization dilemma, some well-known solution providers and retail enterprises have begun beneficial explorations, which are divided into two routes: First, the exploration of omni-channel middle platform system applications in large retail enterprises. Large retail enterprises, due to the cost of completely transforming their core business systems, tend to build an omni-channel retail middle platform system without transforming the existing core business system, combined with digital transformation of stores and products, to complete online and offline business collaboration (O+O). The collaborative business includes: products, inventory, orders, payments, members, promotions, and distribution. Its functions are: decoupling online and offline business, acting as a data HUB for online and offline, and enhancing online and offline business functions and performance. Second, the exploration of complete internet-based transformation of core business systems in small and medium-sized retail enterprises: small and medium-sized retail enterprises, especially small and micro retail enterprises, because their core business systems have less baggage, often choose to carry out overall internet (cloud) transformation of existing core business systems (such as cloudification of ERP, SCM, and CRM) while developing online business, to meet the needs of online and offline business collaboration (O+O). Industry Exploration of Omni-channel Cloud Middle Platform: Fuiu Rongtong Cloud Middle Platform System (heavy cloud middle platform, developed based on complex offline systems). Fuiu Rongtong is a software and solution provider for China's consumer goods and retail industry, providing omni-channel solution services to more than 1,000 consumer brands and retail enterprises and their over 50,000 physical stores. With strong brand influence in the industry and close strategic cooperative relationships with customers, it has always maintained a leading position in the market share of China's retail and consumer goods solutions market. Since 2013, Fuiu Rongtong has begun to launch cloud middle platform products to the retail industry to assist retail enterprises in completing online and offline business collaboration. Application cases include Yonghui Superstores, Wangfujing Department Store, Tianhong Shopping Mall, Beiguo Mall, etc. (but the application effects are rarely followed up by market reports). SAP's Hybris Cloud Middle Platform (heavy cloud middle platform, developed based on a multi-channel online management platform). SAP is a world-renowned ERP system provider. Before being acquired by SAP, Hybris was a provider of multi-channel e-commerce platforms for retail companies. More than 500 companies chose Hybris's e-commerce system, such as Toys "R" Us, Metro, Bridgestone, Levi's, Nikon, Galeries Lafayette, Migro Group, Nestlé, and Lufthansa. In June 2013, Hybris was incorporated into SAP. In November, Hybris upgraded its multi-channel online management platform to an online and offline business collaboration platform and released related products in China. Its application cases include Yunnan Hongxiang, Haiziwang, Yonghui Superstores (which began operation after Fuiu Rongtong's cloud middle platform stopped), etc., but follow-up reports on its application effects are also lacking. Tengfu's Cloud Middle Platform System (light cloud middle platform). The founders of Tengfu are two senior managers of Fuiu Rongtong's public cloud product line. Based on the experience and lessons of Fuiu Rongtong's cloud middle platform, they redeveloped a "light" cloud middle platform. Its positioning is "a company focused on connections" and "an independent third-party service provider." As a light middleware, based on internet business processes, it ensures real-time synchronization of online inventory and orders. Currently, it is deeply linked with multiple online products such as Baidu, JD.com, Meituan, and Ele.me. Existing application cases are said to include Meitehao, Shandong Inzone, etc. Evaluation: The omni-channel cloud middle platform does not require overall optimization of backward traditional systems; it only needs to establish a cloud middle platform between the traditional system and advanced e-commerce systems to achieve complex online and offline business collaboration; it serves as a data HUB for online and offline business collaboration and a decoupling tool between traditional systems and internet systems; business collaboration without mutual impact; when there are multi-channel and multi-merchant online and offline collaboration, complex business rules and system rule configuration make the middle platform's business processing extremely complex, and the flexibility and changeability of online business pose a major challenge for the middle platform's business adaptation. Moreover, the role of the omni-channel cloud middle platform as a public service (SaaS) platform still needs further verification. Industry Exploration of Cloud ERP Qianxi's "Dianxiaohuo" Platform (public cloud architecture, can be privately deployed). Beijing Qianxi Technology Co., Ltd. focuses on providing internet technology solutions for the retail industry, using internet technology as the core and internet+ thinking to create a SaaS model O2O platform product that integrates online and offline intelligence. The Dianxiaohuo cloud platform under Qianxi mainly provides SaaS model inventory and sales ERP software, cloud POS software, and O2O platform systems with independent intellectual property rights for the retail industry, helping small and medium retail enterprises quickly realize the internetization of traditional channel control and operation models through mobile entrances such as mobile phones, tablets, and WeChat, building an omni-channel operation platform for enterprises, promoting business transformation in the traditional supermarket industry, and advancing the channel model upgrade of internet+ retail. Comteck's "Sudian" Platform (hybrid cloud architecture). Comteck is an emerging software supplier for the fresh food retail industry. It focuses on commodity retail circulation, providing management consulting, information technology, and overall solution services, building effective and sustainable business operations and information technology overall solutions for the fresh food retail industry. Comteck's "Sudian" platform, as an e-commerce O2O management system product for the retail industry, has the characteristics of platformization and modularization, effectively integrating multi-channel online business, achieving centralized management of large backend and big data. The system process design principles fully consider combining offline resource advantages, unifying management of products, members, orders, logistics distribution, and services across different channels. It more comprehensively meets the needs of retail enterprises to develop online business. Below are other software companies providing SaaS services in the retail industry (due to the author's limited research perspective, the list may not be complete). Their software product lines each target specific industries. SaaS services for retail core business systems can save retailers a large amount of hardware investment. Retailers only pay a small service fee, no longer hire dedicated system operation and maintenance personnel, and the platform is responsible for daily operation and maintenance; on-demand ordering can be achieved, application scope can be freely selected from a menu, and usage time can be freely chosen; function upgrades and optimization respond quickly, deployment is simple, and function expansion is easy: no matter how complex the system rules, they can be flexibly configured, easily meeting future complex online and offline collaboration business; when business expands explosively, functions can be quickly copied and deployed, and performance can flexibly scale with business volume without affecting system operation speed. Evaluation: From the above exploration, it can be seen that establishing an enterprise's basic ERP business system based on a SaaS cloud service framework is feasible both technically and in application; in the supermarket chain retail industry, optimizing and transforming old systems with backward architecture, missing functions, and poor performance based on online and offline business collaboration (O2O) and internetization is completely feasible technically. In this sense, SaaS platform services for retail core business systems can not only provide core business system services for small and medium supermarket enterprises, but under certain conditions, can even provide core business system services for large (national) and super-large (global) retailers. Dianxiaohuo's Solutions, Products, and Services Solutions and Products The Dianxiaohuo cloud platform mainly provides SaaS model inventory and sales ERP software, cloud POS software, and O2O platform systems with independent intellectual property rights for the chain supermarket industry and FMCG circulation industry, helping small and medium retail enterprises quickly realize the internetization of traditional channel control and operation models through mobile entrances such as mobile phones, tablets, and WeChat, building an omni-channel operation platform for enterprises, promoting business transformation in the traditional supermarket industry, and advancing the channel model upgrade of internet+ retail. Especially for small and medium chain retailers, Dianxiaohuo and its strategic partners have summarized the "one, ten, hundred, thousand" business model and its platform support needs. The meaning of the "one, ten, hundred, thousand" model is: 1. A supermarket chain company or FMCG brand chain company with a certain brand effect and market share in a region (one), with at least dozens of stores of mixed formats or community stores, convenience store formats self-operated stores (ten); with basic chain headquarters management functions, clear division of labor, relatively standardized management, and relatively complete information support systems (traditional systems); in the future, it wants to expand online and offline collaboration business, use asset-light methods to expand hundreds of franchise stores (hundred), and at the same time use brand influence to develop one thousand distribution wholesale small stores (thousand). The Dianxiaohuo SaaS platform includes the following main functional modules to support regional retail enterprises in achieving the business needs of the "one, ten, hundred, thousand" business model: --Basic retail management business for mixed-format chain supermarkets: POS-ERP and its mobile applications, including mobile payment; --Supplier (supply chain) service system: SCM and its mobile applications; --Omni-channel membership management system: CRM and its mobile applications; --Logistics distribution support system: WMS & TMS and their mobile applications; --Online and offline collaboration business support system: mobile e-commerce B2C (based on LBS); --Ordering and distribution support system for franchise small stores: B2b and its mobile applications. At the same time, for FMCG circulation distributors with a certain market share in a region, representing multiple categories and brands of FMCG, with a certain control or influence in the local channel market; in the future, they want to expand online and offline collaboration business through terminal small stores, use asset-light methods to develop distribution wholesale channels (B2b), and at the same time achieve terminal business control by supporting the basic business of small stores b (B2b2C). This type of business model can also be supported by this platform. Management Consulting and Advisory Services For a retailer that needs to build an omni-channel retail business model, the basic tasks are not only to upgrade the core business system based on omni-channel business support capabilities, but also to complete the digital transformation of stores and products, so that stores and products also appear in the "cloud"; to transform the logistics distribution system, such as 2B production based on sales, 2C split-packaging and door-to-door distribution, etc., laying the foundation for omni-channel operation. More importantly, it is necessary to thoroughly adjust and optimize the enterprise's business model, organizational structure, and job responsibilities, reengineer business processes and management rules such as procurement, logistics, operations, and marketing, and cultivate the enterprise's omni-channel operation capabilities, especially online operation capabilities. Based on this need, Dianxiaohuo also launched online business operation guidance and business reengineering management consulting advisory services. Omni-channel retail online business operation guidance consulting: For areas where partners lack key capabilities, Dianxiaohuo has professional online operation support services. Including: product and store organization digitalization (graphic and text processing, SEO) under the business rules of mobile e-commerce and store combination (O2O), product combination suggestions, omni-channel membership marketing, omni-channel business analysis, etc., cultivating customers' online operation capabilities. Omni-channel retail business reengineering management consulting: Dianxiaohuo can provide management consulting coach-level services based on omni-channel business process reengineering, assisting partners in restructuring organizational structure, business processes, and management rules based on omni-channel business upgrade needs, training management and execution layers, and operation guidance, cultivating enterprises to establish a complete set of omni-channel retail operation process capabilities and a mechanism for regular business process upgrades. Online business operation guidance and business reengineering management consulting advisory services are divided into three levels: training level, coach level, and operation guidance level; different levels of advisory services will bring different value to customers. The Supermarket Chain Retail Industry Enters a New Round of Consolidation From the history of informatization in traditional supermarkets in China, we can know that 20 years ago, social demand and consumption enthusiasm triggered the emergence and development of supermarket chain retail; 20 years later, on the one hand, the concept of consumption upgrade is rapidly spreading from first-tier cities and eastern regions to second, third, and fourth-tier cities and central and western regions, even reaching county towns and small towns; on the other hand, the development of internet technology, the popularization of e-commerce and mobile e-commerce; the severe situation faced by physical retail in recent years, and the national level top-level design and policy attention to the retail industry, all indicate that the supermarket chain retail industry will also follow social trends and enter a new round of consolidation. The upgrade of core business systems across the industry based on omni-channel retail, online and offline integration and collaboration, is bound to be an important key task during the consolidation period, even the primary task. Only traditional retailers who seize the opportunity to change quickly during this critical historical period, using core business system technology upgrades to quickly lead business model transformation, can gain a voice and a place in the future, or even become market leaders in the new historical period. The business consolidation 20 years ago formed the business landscape within 20 years; after this consolidation window, will the existing well-known retail brands become yesterday's flowers? Will new retail dark horses appear? History will give the answer. -END- The best FMCG distributor learning platform in China Focusing on providing professional, practical, and useful tutorials for enterprises 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 operation management | 010 Team management | 011 Efficient distribution skills | 012 Sales manager's eighteen skills | 013 KA operation methods and strategies | 014 First lesson for new salespeople | 015 Internet, brand | 016 Distributor B2B transformation | [Long press QR code to follow]