Reporter of the Economic Business: Zhao Wenqi Reporter of the Economic Business Business: Yang Xinyi Editor of the Economic Business: Liu Xuemei
月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月月�
"It's all closed, and all cities are closed." Recently, many Shihuituan Business Development told the reporter of " Daily Economic News " that Shihuituan is gradually closing grid warehouses and self-pickup stations across the country. Some resigned employees even broke the news to reporters that according to some core employees, Shihuituan may have debts of 200 million yuan and are preparing to apply for bankruptcy liquidation.
As of the time of publication on January 28, the reporter tried many times to contact the relevant person in charge of Shihuituan to verify, but no response was received. The news about Shihuituan layoffs and withdrawal of the city had actually been fermenting for many days at the end of 2021.
"Daily Economic News" reporter latest login to Shihuituan mini program to switch to Changsha, Wuhan, Jinan and other cities, and found that on the eve of the Spring Festival, which should be the peak business season, there are no products on the platform at the eve of the Spring Festival. Even if the reporter tried to recharge the phone bill, he was refunded.
At the same time, Qixinbao shows that Shihuituan's affiliated company Beijing Qunxian Huicui Technology Co., Ltd. has been restricted from high consumption recently, and the related consumer restricted consumption targets are Wang Wenjing, the company's legal representative, involved labor dispute dispute cases.
It is sad that in the "2021 China Unicorn Ranking" released by Hurun Research Institute on December 20, 2021, Shihuituan still ranks 83rd with a valuation of 17 billion yuan.
So far, the once unlimited community group buying "old three groups" have experienced the bankruptcy of Tongcheng Life and the loss of Shihuituan in 2021, leaving only Xingsheng Youxuan strong.
can be seen that compared with the glory of giants and capital scrambling to enter the market in 2020, community group buying has seemed to be "a mess" in the past 2021. On the one hand, policies are strongly regulated, and many platforms are punished for malicious low-price competition; on the other hand, as capital and the market become more rational, the original players who have long relied on "burning money" have encountered a fatal blow in the new round of reshuffle.
Of course, it is precisely because of the strong supervision and strict rectification of policies in 2021 that in the eyes of many industry insiders interviewed by reporters, community group buying is a business model that has been gradually verified, and will become a mature business model in the next three to five years. However, given that the front and back ends are extremely expensive and rely more on traffic, especially from the overall market environment, it is necessary to move towards a kind of integration of in-store + home delivery + community delivery, which will also become more of a means for large platforms to obtain traffic, and it is difficult to have independent development unicorns.
It is undeniable that even Xingsheng Youxuan, the only one that is still strong at the moment, has long embraced Tencent , JD and other industrial capital .
Shihuituan lost: "burn all the money" and the order is still being brushed
Zhang Bo (pseudonym), a Changsha employee who has worked in Shihuituan for nearly 5 years, recently told the reporter of "Daily Economic News" that he suddenly received a call from the human resources of the Beijing General Corporation on December 20, 2021. He was laid off due to the company's poor management. "It was the third round of layoffs, and only two or three hundred people were left after the company's layoffs."
According to Zhang Bo, the first round of layoffs began at the end of August last year. The laid off mainly new employees who were under the 6-month probation period. There was no compensation and provided an interview opportunity for Hema Fresh . The target of the second round of layoffs is new executives in each position, and compensation will be paid for N+1. The end of the year is the third round, targeting old employees.
Zhang Bo added, "In fact, the salary in October is also owed, and the basic salary is reduced for no reason, and only 70% is paid." Another employee from Jinan, Shandong told the "Daily Economic News" that he had just joined the company for one year, and when he fired him, he clearly stated that the compensation was only an additional 10 days of salary.
The current dilemma of Shihuituan was unexpected by Zhang Bo. When he saw the news that Tongcheng Life went bankrupt, he still had no sense of crisis at all. He believed that Shihuituan had the support of Alibaba . "I never thought (Shihuituan) would collapse at once."
Obviously, even if salary cuts and lays off employees, withdraws from the city and contracts, Shihuituan's series of "breaking arms and self-rescue" since the second half of last year is still difficult to get a glimmer of hope.The elimination of this unicorn, which has experienced seven rounds of financing and once held the halo of Alibaba's investment, has once again focused on the once-in-community trend of community group buying.
As a primitive player of community group buying, it was once again spotted by the e-commerce giant Alibaba, and Shihuituan was once unlimitedly glorious.
Shihuituan lost Photo source: IC photo-1289539153077600284
Qictbao shows that Beijing Shihui Technology Co., Ltd. was established in August 2018, has completed 7 rounds of financing, and completed a US$750 million Series D financing in March 2021, with a total financing amount exceeding US$1.2 billion. Alibaba , CICC Capital, GGV Jiyuan Capital , Times Capital and other well-known investment institutions participated in the investment. Among them, Alibaba participated in four rounds of investment since the A round and is an important shareholder of Shihuituan.
In August 2019, Shihuituan merged with the community group buying platform "You, Me, You" that has been deeply rooted in Changsha, becoming the top player in the community group buying industry, and is known as the "Old Third Group" together with Xingsheng Youxuan and Tongcheng Life.
Shihuituan Alipay mini program operation person has released a set of data. Since the launch of Shihuituan Alipay mini program in April 2021, the daily order volume of mini program exceeded 3 million within 100 days, with the highest daily increase of users to 70 times. The mini program ranked first in the brand hot search list for several weeks, becoming the Alipay mini program with the highest daily collection.
Shihuituan official website shows that as of now, Shihuituan's business has completed the layout of seven major regions, 25 provinces (autonomous regions, municipalities directly under the central government), and more than 2,000 cities and counties, covering 830,000 communities and 50.83 million family users across the country.
's previous outstanding performance made Shihuituan ambitious. Chen Ying, Chairman and Co-CEO of Shihuituan, said in an internal letter in 2020 that Shihuituan's career must reach at least 1 trillion yuan, "Let's make our dream bigger together." At the end of January 2021, Shihuituan’s official website reprinted the article "New Distribution" stating that Shihuituan has more than 600,000 group leaders, and its goal in 2021 is to complete the strategic layout of 5 million group leaders nationwide and connect online and offline.
Half a year later, the dream is shattered.
In August 2021, media reported that Shihuituan will close grid warehouses in many cities such as Nanning , Qingdao , and Harbin. On the 21st of the same month, Chen Ying responded in an internal letter that Guancheng is closing some business areas with low efficiency, which is a strategic adjustment. At the same time, Shihuituan will also cooperate with Alibaba MMC. However, according to the report of the Internet Economic and Economics on the 23rd of the same month, an insider of Alibaba revealed that Alibaba MMC did not have any business dealings with Shihuituan.
did not wait for Alibaba's olive branch. At the same time, due to the uncertainty of Chinese stocks , a reporter from the "Daily Economic News" learned from an insider that an important dollar fund that had been negotiated also retreated on the spot in the second half of the year. Since then, news of Shihuituan layoffs and withdrawal from the city has followed one after another.
In November 2021, according to multiple media reports, Shihuituan has laid off employees significantly, reducing from 10,000 employees across the country to less than 2,000.
In January this year, many Shihuituan employees, including Zhang Bo, confirmed to the Daily Economic News that Shihuituan had large-scale layoffs and withdrawn from the city. "The 33 urban circles have been reduced to the five in Guangzhou, Shenzhen, Jiangsu, Jinan, Wuhan and Changsha. Many of the layoffs were directly shut down by the city's business, and a lot of employees have left."
As of the time of publication, a reporter from "Daily Economic News" tried to contact the relevant media contact persons of Shihuituan many times, hoping to learn about the company's current operation, but none of them were successful. It also asked the relevant person in charge of Shihuituan, but no response was received.
The reporter opened Shihuituan’s official WeChat official account and found that as of January 25, 2022, the official account was still posting a document to discuss the North and South Little New Year’s Day.
reflects on the loss of Shihuituan. Zhang Bo told reporters that major community group buying companies started a price war in 2020, and "indiscriminate subsidies and losses" have given rise to chaos in salesmen's order brushing. Through huge subsidy coupons, the price of the goods is lower than the purchase cost. In order to meet the performance standards, many salesmen will place large orders and resell the goods for a second reselling.
In March 2021, the most well-known is that the State Administration for Market Regulation imposed an administrative penalty of on 5 community group buying companies including Shihuituan for order swiping chaos.The reason for the punishment mentioned that these enterprises use their financial advantages to carry out large-scale price subsidies, disrupting the market price order.
Just 3 months later, in May 2021, Shihuituan was once again fined 1.5 million yuan by the State Administration for Market Regulation for improper price behavior and ordered the suspension of business and rectification.
After two consecutive heavy fines, the order brushing continues.
Zhang Bo provided a screenshot to the reporter. The salesperson was still brushing orders in disguise by changing the books in mid-2021. For example, the market price of 30 grains and eggs with a plate of cereals is 17.5 yuan, and the price on the Shihuituan platform is 13.68 yuan. In order to meet the requirements of the Municipal Administration for Regulation, the salesperson will change the cost price of the egg to 13.68 yuan on the book. Zhang Bo said that 37,137 copies of this product were sold on the day of the group opening. For every copy sold, the company lost 3.82 yuan. The one-day sales of this product alone cost the company more than 140,000 yuan.
Zhang Bo said that Chen Ying introduced the Amoeba operating model to Shihuituan in 2020, so that each city circle will be responsible for its own performance and profit results. Zhang Bo introduced that after completing the KPI of the city circle that month, all employees in the city circle can receive different Amoeba rewards. "The salary of the lowest-level employees in Changsha is only 4,000 to 5,000 yuan, but after completing the task, the Amoeba reward can be 3,000 yuan, so everyone is thinking about swiping orders." As for the specific KPI, Zhang Bo said that the value is not important, "KPI can be swiped out. Some purchasing said that KPI can be set at will, and as much as you set, you can complete it."
In addition, Zhang Bo recalled that until he was laid off on December 20, 2021, Changsha Shihuituan always maintained normal group opening and delivery every day. In early January this year, Zhang Bo opened Shihuituan's mini program. The changes above made her unable to understand, "Changsha is still opening a group, and it becomes a delivery every five days. I was surprised. There are very few products. Fresh fruits were originally used to attract traffic, but now there is no supplier willing to supply them. So why not stop the group? What is Shihuituan waiting for?"
reporter also noticed that on Shihuituan's official WeChat official account, during the Double 12 of 2021, there are four related cities and provincial capitals, Changsha, Wuhan, Jinan and Jiangsu, and the provincial capitals.
As of January 27, 2022, there are no products sold on Shihuituan mini program. "Changsha will not start a group anymore. I heard that the remaining employees have also been dismissed." Zhang Bo told the reporter of "Daily Economic News". He heard some core employees say that Shihuituan has already in debt of 200 million yuan and is preparing to file for bankruptcy liquidation. However, as of press time, the relevant person in charge of Shangshihuituan could not be contacted for further verification.
Unicorns fell one after another, community group buying entered a cooling-off period
large-scale layoffs and business contractions... The experience of Shihuituan is just a microcosm of the current situation of community group buying. Since 2021, the community group buying market is undergoing a cruel reshuffle.
Once upon a time, community group buying was so popular that it was comparable to the Hundred Group Battle of that year. The epidemic has caused community group buying to stage a "turnaround" and players from all walks of life are making rapid progress. According to public statistics, in the first half of 2020, more than ten financings occurred in the community group buying and fresh food e-commerce fields, with an amount of 10 billion yuan. Xingsheng Youxuan, Shihuituan and other platforms have completed at least two rounds of financing.
The community group buying market is ushering in a cruel reshuffle. Image source: IC photo-1098096680967077987
. In 2021, although policy supervision is tightened, leading community group buying companies are still favored by capital.
E-commerce Research Center data shows that in 2021, there were 10 financing incidents in China's community group buying industry, involving platforms: Yipin Fresh , Xingsheng Youxuan, Dolphin Purchase , Haolin Haowu, Shihuituan, Guangyi Supply Chain, Kangpinhui, with a total financing amount of more than 28.59 billion yuan. Among them, Xingsheng Youxuan alone received three financings within one year, with a financing amount of nearly US$4 billion.
turns in the second half of the year.
In July 2021, Tongcheng Life's parent company Suzhou Xiancheng Technology Co., Ltd. issued an announcement stating that the company decided to file for bankruptcy due to poor management. This company, once the second largest in the industry after Xingsheng Youxuan, officially announced its collapse and became the first community group buying unicorn in China, causing an uproar in the industry.
On July 23 of the same year, the Wuhan headquarters of the community group buying platform Food Enjoyment Company was empty, the supplier's payment was not settled, the employee's salary was owed, the platform's shopping mini program has not been opened, and many senior executives have resigned. But Dai Shanhui, founder of Shixianghui, responded a few days later that it was just shut down, saying that the community group buying business was too expensive and had been losing money, and was preparing to transform into a physical convenience store.
Now, Shihuituan, which was once considered "backed by a big tree" because of his investment in Alibaba, has suddenly fallen into business difficulties, and there are few original players left in the community group buying market. Bao Yuezhong, a special researcher at the E-Commerce Research Center of
.com and a new retail expert, said that community group buying such as Shihuituan has problems in business models. Relying solely on community group buying, it lacks supply chain capabilities and user operation capabilities, so it is difficult to "run" such a relatively single business model.
He further stated that under the current market environment, retail should be in-store retail and home-based retail, including the retail form of community delivery created by community group buying. From the overall market environment, it is difficult for them to survive alone. They must become a kind of integration, which can form a kind of delivery in-store, home and community. Combining these forms together will form a relatively valuable retail form.
This seems to explain why the original community group buying players are extremely competitive when they occupy one side. Once the clarion call for expanding the whole country is sounded, they will eventually leave in a disappointment.
Community business research expert Peng Chengjing also believes that community group buying cannot become an independent business model, it can only be a means for large platforms to obtain traffic. "If community group buying wants to become an independent operating platform, the front-end needs a lot of funds to expand the market, the back-end needs a strong logistics supply chain and purchasing team, and the front-end is an extremely expensive job."
In Peng Chengjing's view, this is also a problem that every original community group buying player must face in the expansion of the scale: if an independent community group buying platform wants to grow, it must repeat the work done by the original e-commerce platform, both time and technology are in a catching-up state. As long as the big platform is not lazy and is not worse than you in terms of funds, the first-mover advantage of the independent group buying platform will gradually decrease over time until it falls behind.
is also precisely because of this, Shihuituan’s current dilemma is related to its burning money to exchange for scale and loss to exchange for traffic. Apart from its low-price advantage, the product has no core competitiveness. The platform lacks the ability to "make blood". Although it has realized that it has begun to shrink its business, it is at a disadvantage in the face of the squeeze of giants. This is also a common problem faced by living in the same city, food and entertainment meetings, etc.
"As for the subsequent competitive landscape of community group buying, it is not necessary to consider it. Unicorns are very difficult. Even if there are, they are the kind that has a thigh. It is basically difficult to operate independently. Community group buying will become an auxiliary means of obtaining traffic, which exists on various platforms and chain physical retail channels. It is dependent on survival and is extremely difficult to develop independently." Peng Chengjing said.
is difficult to become an independent business model. Where can the business model go?
"Community group buying is a business model that has been verified. In the next three to five years, it will definitely become a mature business model. However, in this process, it is necessary to continuously change and integrate according to the characteristics of the region, changes in consumer groups, policy adjustments and technical upgrades. It is actually a good entry point for online and offline integration." Bailian Consulting founder Zhuang Shuai told the reporter of "Daily Economic News".
is a consensus in the industry that although unicorns are no longer in popularity, community group buying is actually an incremental business model that has been verified and feasible and some consumers are willing to accept.
However, this business model has its current market size not enough to support its independent existence. It must rely on mature business formats for development, such as relying on mature takeaway business formats, mature e-commerce formats, and mature supermarkets and convenience store formats for development.
may have seen its own advantages in scale and strength early on, and community group buying was once the focus of competition among giants such as Alibaba, Pinduoduo, Meituan , Didi .In the past two years, JD.com has invested in Xingsheng Youxuan, Pinduoduo promotes Duoduo Maicai, Meituan develops , Meituan Preferred , etc., which has also made the competition in this track extremely fierce.
However, facing increasingly tightening policy supervision and escalating market competition, the competition among giants is also being layered. Under the pressure of "burning money" and market competition, even with rich market experience, many giants will find it difficult to survive. In the past year, the giants have also seen a little difficult and prudent pace.
Didi said in its third quarter financial report that affected by changes in the fair value of by Chengxin Investment , Didi confirmed a net investment of loss of in the third quarter. As the community group buying business that Didi has entered in a large number of previous years, Chengxin Youxuan has also encountered difficulties such as business contraction and store closure in 2021, and urgently needs to explore new business models and transformation directions.
Meituan disclosed in its third quarter financial report revenue for 2021 that its catering takeaway business, in-store, hotel and tourism revenues have all achieved profitability. However, the company's new businesses such as Meituan Youxuan and Meituan Maicai have achieved losses. Meituan revealed that the loss of the above-mentioned new business was about 10.9 billion yuan.
. After Alibaba failed to bet on Shihuituan, or internal horse racing "give up" Shihuituan, it also made timely adjustments within. In March 2021, the Alibaba Community E-commerce Group was officially established. In September, the original "Hema Market" and other brands were uniformly upgraded to " Taocai "; Alibaba's financial report shows that its Taocai GMV in the second quarter of the fiscal year increased by more than 150% month-on-month, and is currently in rapid development, but it is still some distance away from the industry's leading platforms in terms of scale.
Public data shows that the community group buying track received financing of up to 28.5 billion yuan in 2021. If the giants invest in this track, community group buying may cost up to 100 billion yuan.
It is worth mentioning that after embracing Tencent and JD industrial capital, Xingsheng Youxuan, as the current community commercial unicorn, revealed to the reporter of "Daily Economic News" that by the end of 2021, Xingsheng Youxuan has entered 17 provinces and municipalities directly under the central government, more than 1,400 prefecture-level county-level cities, more than 100,000 townships and rural areas across the country, and has more than 1 million cooperative stores. The platform has about 80 million monthly active users, and GMV has achieved a 1,400-fold increase in five years.
Zhuang Shuai said that from the current market structure, community group buying is a combination model with offline supermarket convenience store formats, the most typical representative is Xingsheng Youxuan; the other is a platform model such as Taocai, Meituan Youxuan, and Duoduo Maicai. However, if you look closely, Duoduo Maicai's model focuses on fulfillment of contracts; Meituan Youxuan combines customer acquisition and fulfillment of contracts; Alibaba's Taocai focuses on gaining customers, and now the differentiation of operation details of each giant in community group buying has emerged.
Under this trend, community group buying will further refine operations in the future and explore opportunities for further combination with the platform's original model, forward warehouse, and offline business formats. However, it is not sure what changes in policies and capital will be like in the future. The future development prospects of community group buying should also be combined with these two factors before looking at it.
"At present, group buying in small and medium-sized communities in many regions is still relatively good. If you can manage design group buying in a certain region well, and then cooperate with giants to serve giants, it is also a way. However, to independently develop a national design group buying enterprise, it is still difficult for start-ups to be started," said Zhuang Shuai.
At the beginning of 2022, compared with the giants' shouts of gunpowder on community group buying business last year and the previous year, this year seems to be quiet and low-key. However, from the depth of Duoduo Maicai, Taocai and Meituan Youxuan, it can be seen that this track is still undercurrent.
From the hot 2020 to the deep waters of 2021, community group buying has entered a turning point in development. Although this proven business model has many difficulties in the development process, competition is still continuing.
Daily Economic News
