Recently, we visited three B2B platforms focused on the catering industry: Caiba, Tongying Tianxia, and Meicai. All three are B2B trading platforms with catering ingredients as their main transaction objects. Although all are B2B, their models differ slightly. Today, through an introduction and analysis of these three models, we will discuss with you: "Will the supply model for grain, oil, and condiments in the catering channel be rewritten by B2B platforms?"
First, let's look at a comparative introduction of the three:
Caiba: Caiba focuses on an online B2B trading platform for condiments for small and medium-sized restaurants. They cooperate with city partners locally, utilizing their warehousing and distribution systems to provide online procurement and delivery services for small and medium-sized restaurant kitchens, including grain, oil, condiments, dried goods, beverages, alcohol, and hotel supplies. In terms of sourcing, the Caiba platform negotiates directly with upstream suppliers for some branded products, while city partners also source some goods locally. Finally, city partners adopt a model of centralized warehousing plus unified distribution. Small restaurants only need to order online, and Caiba's local city partners can ensure delivery by 10 a.m. the next day. Advantages: Focusing on small and medium-sized restaurants, especially fast-food channels, the advantage of focus is the ability to provide personalized and professional services, with self-owned warehousing and sorting, unified distribution, ensuring standardized service and timely delivery.
Tongying Tianxia: Tongying Tianxia focuses on online matching for standardized kitchen products. After local city partners join the platform, they contact and introduce local suppliers to open stores on the platform. Restaurants order online, and suppliers deliver themselves. At the same time, Tongying Tianxia directly cooperates with enterprises to find high-quality sources for local city partners, helping them provide product diversity. The platform charges city partners a franchise fee and a portion of transaction commissions. Within one year of establishment, it has launched more than 50 prefecture-level markets in Northeast and North China. Advantages: Tongying Tianxia uses standardized technology and models to help local city partners quickly expand the market. Because it is a pure transaction matching platform model, the platform is very light, so replication speed is extremely fast.
Meicai: Meicai started with fresh vegetables for hotels and focuses on procurement and delivery services for hotel and restaurant ingredients. Hotel owners order online, and Meicai can purchase from origin, use its own warehousing, sorting, and delivery to deliver ingredients directly to hotels. Currently, Meicai has over 10,000 employees, making it the largest company in terms of offline self-owned personnel among domestic B2B platforms. Due to the pressure of self-operated growth and capital turnover, Meicai plans to adopt a transaction matching platform model for standardized kitchen condiment products, combining matching with self-owned product portfolios, and then using self-owned warehousing plus ground promotion to quickly enter the local catering market supply chain system. Advantages: Meicai is a platform that has been relatively successful in financing during the capital winter. Under the previous heavy asset model, it accumulated a lot of operational experience and supply chain resources. For its existing market, doing matching is something that can be done along the way.
Next, let's have an in-depth discussion about the catering ingredients industry.
Ingredients include a large number of FMCG products: rice, flour, oil, condiments, etc. Due to the special nature of the catering industry, issues such as the mismatch between restaurant owners' procurement times and distributors' delivery times, price fluctuations of fresh ingredients, and settlement methods between restaurants and suppliers have led to such distributors rarely supplying directly to restaurants. Generally, they go through secondary wholesalers in local wholesale markets. Since wholesale markets have existed for many years, their existence has a certain rationality: business hours match the procurement rhythm of restaurants, products are extremely rich, fresh ingredients are fresh enough, settlement methods are flexible, and service is thoughtful. These are all advantages. Let's give an example: When a wholesale department negotiates products with a restaurant owner, in order to retain the restaurant owner and establish long-term cooperation, the prices of products inquired by the restaurant owner are generally highly flexible, even to the point of not making money on a single item. Rounding down, free gifts, flexible settlement methods (daily, weekly, monthly, even yearly), buyer rebates, etc., this kind of artificial flexibility is currently unsolvable by platforms. However, we can also see that platforms can still solve many pain points for restaurant owners, such as: Restaurant owners no longer need to get up early. Most small and medium-sized restaurants do not have a separate procurement department, so owners need to go to the wholesale market themselves. When they close late the night before, restaurant owners often lack sleep. But this type of B2B platform can help them solve this problem. They don't need to get up early; they can solve procurement problems in one stop on a computer or mobile phone without leaving home. Lower product prices. There are a huge number of small and medium-sized restaurants, but due to their small and scattered order quantities, they cannot form procurement cost advantages, and their bargaining power in wholesale markets is not strong. Moreover, market prices are not transparent, and they are often deceived by unscrupulous merchants. Platforms have a huge collective procurement advantage and strong bargaining power over the upstream supply chain, helping small and medium-sized restaurant owners obtain lower procurement prices. Flattening of distributor channels. For condiment distributors, restaurant stores are a channel they want to cover but lack the ability to cover. Originally, although wholesale markets covered them, they often could not fully cover them. But through platforms, they can seamlessly connect with restaurants on the platform, increasing product sales opportunities. For distributors, they are very willing to cooperate with platforms. Standardized product output, thoughtful and timely service, and smooth information access are all unique advantages of platforms. Platforms can meet not only the needs of restaurants for grain, oil, and condiments, but also disposable tableware, beverages, fresh and frozen products, and even financial and corporate cooperation. These are all future business opportunities for platforms.
The catering industry is a typical fragmented and huge market. In 2015, the total revenue of China's catering industry exceeded 3 trillion yuan. Although there is no specific data on the total procurement amount of related upstream products, it is believed to be a huge market. In any segmented industry in China, as long as you go deep, the business space is full of imagination. The catering channel has always been a channel that grain, oil, and condiment distributors want to penetrate but find difficult. The emergence of platforms just meets distributors' needs for coverage of this channel. Therefore, whether platforms are matching or self-operated, it is good news for distributors. Therefore, for the supply model of standardized products like grain, oil, and condiments in the catering industry, I personally believe that the chance of being rewritten by B2B is very high, and unicorn companies like Didi will also appear in this industry. Who can stand out in a short time depends on the platform's own operational level.
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