Image source: Visual China In Wuhu, Anhui, a 300-square-meter snack store achieved a daily average sales peak of 150,000 yuan and monthly sales of 2.4 million yuan in its first month, figures even higher than some community supermarkets covering over 1,000 square meters. This is Three Squirrels' first physical store offline—the Three Squirrels Feeding Store. Located in the Golden Eagle International Center in downtown Wuhu, the store sits next to MUJI and Starbucks. The interior decoration, including shelves and ornaments, follows a forest theme. In addition to common products like nuts and dried meats available on the online store, the store prominently displays Three Squirrels merchandise such as plush toys, notebooks, water cups, and slippers. Moreover, one-third of the store is dedicated to lounge seating and a bar counter, offering freshly made "water + light food" products, mainly milk tea and fruit juices. Unlike other snack stores, customers are greeted by the anime-style singer Luo Tianyi's "Feeding Song," catering to post-90s consumers who favor anime culture. After more than 40 days of operation, Three Squirrels released sales and per-customer transaction data for the first month. Three Squirrels' one-month sales and per-customer transaction data In the vision of founder Zhang Liaoyuan, the store focuses more on experience, including rest areas, beverage offerings, and merchandise, all aimed at helping more consumers understand the Three Squirrels brand. He even proposed limiting purchases offline, encouraging customers to scan QR codes on shelves to visit the Three Squirrels flagship store online. In reality, however, offline stores are more profitable than online. Zhang told Interface Consumer reporters that in physical stores, consumers are more impulsive due to seeing the actual products, especially for merchandise. The gross margin of the entire physical store exceeds 40%, which is 8-10 percentage points higher than online. Initially projected to achieve annual sales of 8-10 million yuan, based on the first 40-plus days, annual sales are expected to reach 10-12 million yuan. With a 40% gross margin, the store could recoup its investment (over 1 million yuan) within a year. Currently, the experience store does not accept franchising. According to Three Squirrels' plan, the first Wuhu store will serve as a template for future stores replicated elsewhere. In December this year, Three Squirrels will open three stores in Nantong, Suzhou, and Bengbu, in partnership with Golden Eagle and Intime shopping centers. "Deals are basically settled in Wuhan, Hangzhou, Xi'an, and other places." Zhang's requirement for store locations is "as close to the street as possible." Currently, Three Squirrels is negotiating with mainstream offline shopping centers or department store groups such as Wanda and CapitaLand. These stores will be laid out along Three Squirrels' two DCs (Wuhu and Tianjin) and eight IDCs (small warehouses) nationwide, with a target of 100 stores in 2017 alone. Zhang stated that leveraging the internet dividend has completed the first step of fan accumulation, and now the brand strength of Three Squirrels needs to be extended offline. Last year, Three Squirrels spent 20 million yuan on product placements in 10 TV dramas, including this year's hits "Ode to Joy," "A Love for Separation," "Love O2O," and "Dear Doctor," aiming to transform Three Squirrels from a Taobao brand into a national brand. Additionally, Three Squirrels invested 15 million yuan to produce a 54-episode anime TV series of the same name, set to air on major satellite channels in the second half of next year, hoping to "start brand cultivation from childhood." However, it will take time for these children to grow into Three Squirrels fans. Meanwhile, snack retailers with existing physical stores, such as Liangpin Shop and Laiyifen, are also expanding. After being acquired by Haoxiangni, Baicaowei is leveraging Haoxiangni's stores to pursue similar paths of new products, fun, and IP, all of which may pose challenges to Three Squirrels' future stores. Source: Jiemian