Retail Formats
Hema and Yonghui Learn from Each Other: The Battle for Lower-Tier Markets Enters a 'Long Season'
At a residential area outside Beijing's South Fourth Ring Road, a small Hema Fresh Outlet store is crowded with customers waiting for opening before 8 a.m. daily. The store mainly sells near-expiry products from Hema Fresh at ultra-low discounts. Despite a chaotic shopping experience, this community store model has brought unexpected growth for Hema, with outlet and neighborhood stores growing 555% year-on-year by end of 2022. Meanwhile, Yonghui, a traditional supermarket giant, is undergoing a painful digital transformation, and both companies are now learning from each other as they compete in lower-tier markets.
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