Under the normalization of the epidemic, retail chain companies are generally under upward pressure from inventory costs, labor costs, and rental costs, so they pay more attention to maintaining healthy cash flow. The repeated and fierce competition of the epidemic have made companies pay more attention to expanding their scale while improving their ability to withstand pressure and improve their own efficiency. Digitalization will become a new trend for physical retail companies under the normalization of the epidemic. How to achieve digital transformation for traditional retail companies and seek healthy development while fulfilling their social responsibilities as an important infrastructure for people's livelihood is a major challenge, and many retail companies are looking for answers.

As a pioneer in the digital transformation of physical retail enterprises, Wumart has perfectly demonstrated the "Wumart Speed" under the test of the epidemic and delivered an outstanding report card. In April and May this year, Beijing was tested by a new round of epidemic. With the strong support of the government, Wumart was able to leverage its huge advantages in the digital supply chain and the docking of agricultural supermarkets to quickly transport supplies from all over the country to Beijing. The supply of vegetables increased by 3-5 times compared with normal days. It is the unified and smooth supply chain across the country and multi-point DMALL digital technical support that ensure that Wumart has the confidence to inject vitality into the Beijing market at critical times, achieving "Beijing's speed, fighting hard to ensure supply, and the capital market is rock-solid."

Similarly, it is precisely because Wumart has achieved more than 80% of users digitalization that it can directly provide online services to consumers when stores are temporarily closed during the outbreak of the epidemic. Taking Yanjiao, Hebei Province as an example, Wumart's online sales only account for 20% of the total sales. After the lockdown, due to the digital channels connected to consumers, online sales quickly increased by 5-6 times, exceeding the original omni-channel sales; during the Shanghai epidemic, Wumart Metro stepped forward and achieved online distribution in 6000 communities through Metro APP.

Zhang Wenzhong, founder of Wumart, emphasized thatDigitalization is the key to Wumart's integrated online and offline services to fight the epidemic and ensure supply. Digitalization is extremely important for circulation companies to survive and work.Why is it difficult for circulation companies to survive without comprehensive digitalization? We must also start from the issues of passenger flow growth, commodity supply chain management, and organizational cost reduction and efficiency improvement that deeply plague retailer bosses.

85%，70%

According to the "Chain Supermarket Operation Report (2020)" released by the China Chain Store and Franchise Association, the passenger flow of chain supermarket stores in China has generally declined, with an average decrease of 4.9%. Huang Mingduan, executive director of Gaoxin Retail, once publicly stated: "The loss of passenger flow from offline stores in traditional hypermarkets is an irreversible process."

Looking back at Wumart, we found that as of 2022, Wumart has achieved hundreds of millions of users through all channels.The proportion of APP orders in some stores has reached 85%。Growth against the market is not an accidental act. In 2015, Wumart founder Dr. Zhang Wenzhong's proposal and exploration of distributed e-commerce laid the foundation for today's events.

In fact, as early as before the epidemic, physical retail has already felt the huge impact of Internet e-commerce. Because the online consumption habits that users have been cultivated are irreversible, we must work wherever users are. Ma Yun and Wang Jianlin's ten-year bet on online share is approaching. Winning and losing seems to be less important at this time. After ten years of commercial verification, everyone has also found that online and offline integration is the final result.

Online and offline integration is not a simple online transaction. What is more valuable to enterprises is insight into user behavior and matching precise marketing strategiesIn the past, Wumart's offline order and online order information were not synchronized, and the value of data naturally could not be maximized. With its own online mall, Wumart can conduct more in-depth research on users and gain insights into different regions and scenarios. Shopping preferences, behavioral paths, etc. currentlyOnline members in some Wumart stores account for more than 70%, members go to the store and use the code scanning bank to make purchases. At the same time, with the technical support of multi-point marketing mid-station, we can analyze user consumption behaviors and formulate different precise marketing strategies based on model algorithms, such as price reduction push, big promotion reminder, arrival reminder and other forms to wake up sleeping users. Offline members conduct online conversion and drive user consumption through coupon issuance, check-in, and hot product lists to achieve integrated online and offline marketing management.

Therefore, one of the key actions of online and offline integration is to integrate user operations and build your own membership system and private domain traffic matrix, so that you don't have to worry about being "taken away" by your product data and user consumption information, nor do you have to worry about being "kidnapped" by third party platforms. Another key action of online and offline integration is the integrated management of the commodity supply chain, which is also an important part of opening up sources and reducing expenditure for physical retail companies.

60%, 21 days

In the operation of physical retail, the importance of "goods" is self-evident, and part of Wumart's success comes from the adjustment and optimization of product efficiency, product structure and inventory management.

In the commodity circulation link, Wumart relies on data to strengthen its headquarters's control of the store's product structure, making it more in line with the individual needs of users in the business district. At the same time, it comprehensively considers various factors to keep the running speed of each single product running. Continuously improve, determine deposits based on sales, and significantly reduce turnover days, making the replenishment of stores and warehouses more scientific and greatly improving product efficiency.

In terms of product efficiency, Wumart has changed its traditional way of relying on suppliers and experience to make judgments. Through the analysis of online and offline historical sales data, the perspective of big data in related business districts, and data analysis and research in business districts around stores, etc., actions to achieve accurate prediction of demand information.By December 2021, product selection efficiency will increase by 60%Selling suitable products to the right group of people through big data has truly changed the traditional situation of relying on manual experience to order.

In terms of product structure, Wumart has also faced the problem of homogeneous products. In thousands of stores, the product structure is mainly large and comprehensive, and most of the attention paid to the product structure stays on training and requirements. As the consumption power and purchasing preferences of regional users change, the large and comprehensive product structure results in the inability to focus on users 'personalized needs, resulting in a decrease in product satisfaction. For this reason, Wumart continues to sort out the product structure and streamline the quantity of products., conduct multi-dimensional product selection analysis around each SKU, promptly eliminate and add new product categories on the shelf, and comprehensively consider the market data of the merchants' region to adjust the product structure in a timely manner. The combination of system automation that realizes manual strategies and system intelligence driven by algorithms not only effectively reduces the store area, but also optimizes the product structure of the store and completes the expansion of category width and depth. The success rate of new product introduction has increased by 30%, and the effective replacement rate has increased by 25%.

In terms of inventory management, large area of land and large backlog of goods have always been the most troublesome problems for physical retailers. Faced with the same problems, Wumart based on more scientific data cleaning and replenishment counting logic, bid farewell to store staff. Experience and replenishment habits rely on data analysis and the actual situation of the business district, including sales expectations, weather festivals, etc., to output more reasonable product suggestions, and the headquarters uniformly manages a series of processes of ordering, storing, and returning goods. Take Wumart Lenovo Bridge Store as an example. During the promotion period,Inventory turnover days have also been reduced from a maximum of 35 days to 21 days, greatly improving supply chain efficiency.

1.1 times, 11.7%

As we all know, the overall profit level of the physical retail industry is not high, so cost control is a great tool for physical retail companies to continue to develop healthily. In addition to minimizing the impact of channels, supply chains and rents, it is also necessary to improve the utilization efficiency of various resources in "people, goods, markets".

Wumart Lenovo Bridge Store is located on Zhongguancun East Road, Haidian District, Beijing. Competition in the nearby business district is fierce and the competition pressure is huge, which promotes Wumart Lenovo Bridge Store to actively innovate and seek transformation. Before the renovation, Wumart Lenovo Bridge Store had a monthly net loss of more than 1 million yuan, making it the top three stores with losses in the entire Wumart system; after the renovation, through the digital application of the supply chain, it not only achieved a significant reduction in labor costs and warehouse area, but also achieved aA 1.1-fold increase in profit margins。

First of all, in terms of store personnel management, the labor costs of supermarkets generally account for 30%-40% of the overall operating costs. Only by improving human efficiency can income be guaranteed. Through the application of digital systems, Wumart quantifies employee behavior and uses big data to analyze every position and each type of work. Each position has multiple abilities and everyone is online to ensure the healthy operation of stores and the efficient operation of products. Take store ordering as an example. There are more than 600 stores in Beijing Wumart. In the past, each store was equipped with 2-3 people to order. Now the headquarters centralized ordering group places unified orders, with less than 30 people participating in the ordering.Ordering alone can save more than 10 million in labor costs every yearThis is a large amount for most brick-and-mortar retailers.

Secondly, in terms of store operation and management, the difficulty in online and offline channel management for physical retailers lies in the inventory data of each channel. It is difficult to maintain consistent commodity prices in real time. Commodity management has many influencing factors, long business chains, and highly relies on employees 'personal experience. Personnel experience is uneven, resulting in poor decision-making quality and low efficiency. The digitalization of the supply chain makes store inventory information completely transparent. Whether products are sold in online channels or offline stores, the inventory information will be updated simultaneously, and the replenishment process of corresponding products has become efficient and accurate. The warehouse behind the store can be used as a replenishment warehouse for stores, and can also be used as a picking warehouse for online orders. Through continuous optimization of business strategies and the application of Digital tools, Beijing Wumart has reduced the proportion of store warehouse space from more than 32%.Reduced to around 11.7%, increasing the warehouse space by about 20%.

User-centered, one-to-one service

Therefore, digitalization for physical retail companies is a reengineering of their own operating models and organizational processes. It is a value reshaping that runs through every aspect of the front, middle and back office. It requires a deep understanding and understanding of the physical retail industry. Multi-point DMALL Partner Ren Zhongwei combined the experience of multi-point DMALL serving the digital transformation of retail companies in the past seven years and summarized the "DUS Capability Model for Retail Enterprises in the Digital Era"(D digitalization, U user operations, S supply chain) In his view, retail companies must continue to win in the future,First of all, we must return to the essence of the retail industry, which is user-centered and one-to-one services. At the same time, we need to establish three major capabilities: user operation, supply chain, and digitalization, all of which are indispensable.

First, user operations. The essence of retail is a one-to-one customer-centered service model. The increase and expansion of stores have made it impossible for limited manpower to provide one-to-one services for users. At the same time, physical retail faces dual challenges from online and offline. The diversion of user traffic by e-commerce platforms forces physical retail companies to achieve integrated online and offline user operations. In addition, many retail companies are building private domain traffic pools to better understand user needs, what users like, and what they often buy. At the same time, after establishing a membership system, they can use AI to precise marketing to truly achieve thousands of people and one-on-one precise service, rather than providing users with batch services.

Second, the supply chain. The essence of a circulation enterprise is to sell goods. Are store goods a good and suitable product and can reach users in the shortest time? Digitalization of the supply chain can solve the problems of large inventory and low efficiency from end-to-end, and can greatly reduce the transaction costs of brands and retailers. Communication, contracts, performance, etc. can all be completed online. Both parties have equal information and standards. Unify, achieve efficiency improvement and cost reduction, and feedback cost savings to users. Moreover, from production to delivery, reconstructing the supply chain from a global perspective, doing top-level design, and optimizing end-to-end can minimize transportation time, moving times, inventory in each link, etc., and improve efficiency and reduce costs from the entire link.

Finally, digitalization.Digitalization can better help retail companies achieve supply chain and user operationsOn the one hand, the maturity of new technologies, such as AI, big data, cloud computing, and artificial intelligence, has brought more opportunities to enterprises. Moreover, in order to achieve comprehensive digitalization from end to end, good technology also needs to be combined with business best practices and maintain the ability to continuously iterate. In addition, intelligent decision-making must be achieved. For example, retail giant Wal-Mart once sold baby diapers with beer, but sales of diapers and beer both increased, precisely because Wal-Mart made good use of it.big data technology。In addition to smart display, digital methods can also be used to help physical retail companies improve issues such as product selection.

last words

"Humanity needs to be fully digitized. Digital China has become a national strategy. Digitalization is a long-term process. Today is only 1% to 2% of the historical process. We must unswervingly believe that digitalization is the future."

in factdigitalFor Wumart,A process of reshaping corporate value, including a series of adjustments to operating processes, organizational structure and management models. In this process, multi-point DMALL provides strong technical support to ensure the stability, security and rapid response of the system. At the same time, relying on Wumart's practical experience, multi-point DMALL has also completed rapid iteration and market-oriented verification of its products, truly helping retail companies achieve data-driven management decisions and operational optimization. Dr. Zhang Wenzhong always hopes that through Wumart's practical experience, he can bring more possibilities to the development of the industry and bring more inspiration to retail companies. He believes that with the joint efforts of everyone in the future, China's physical retail industry will also enter a new era. The digital era.