Traditional Culture Encyclopedia - Traditional stories - Why are domestic convenience stores always losing money?

Why are domestic convenience stores always losing money?

Hello, I think the domestic convenience stores are always losing money is a pseudo-proposition, can not be generalized.

Imagine: on the last day of the year, or during the worst days of the epidemic, when all the restaurants around were closed, it was good that convenience stores stayed open to give people food and warmth.

We have to know that if it is a chain of convenience stores, the whole family has been profitable since around 2012, and Rosen started to make profits almost in the middle of 2017, and for 711, although it is the leader of convenience stores, it is still not the boss in China, and it is said that it has not yet realized profitability in China.

Overall, there is no doubt about the speed and scale of convenience store development. If you look at a single store, there are definitely losses and profits, which is the same for every industry.

Of course, the biggest challenge for convenience stores is the operating costs, which no one knows. Convenience store rent, decoration, equipment and 24-hour store operating costs, equipment and merchandise loss and a variety of miscellaneous expenses, resulting in high costs, which is the existence of individual convenience stores operating at a loss can not escape the reality of the problem.

If you want to run a good convenience store, in fact, or the most test of management level ability. If the convenience store wants to make a profit, the most important factor recognized in the industry is: location.

But as long as the migrant workers working in Beijing are home for the New Year, the 711 convenience store in Guomao is going to usher in a period of low.

Sometimes, the city's business district and the flow of thousands of changes, if there is a change, resulting in a decline in performance or even losses, store closure is a common occurrence.

Just above we have looked at the 2018 convenience store data, we can go back to the 2016 convenience store data, compare, in fact, the upward trend are very obvious.

According to the statistics of the China Chain Store Association on the benchmark convenience store enterprises, in the first half of 2016, 52.3% of enterprises maintained growth, and only 16.6% declined year-on-year, and the overall growth rate in 2016 was around 15%, and the total market reached 100 billion. Compare the data of 2018, just two years, the total market is equivalent to a direct doubling.

According to the data currently about 50% of the convenience stores in the country belong to gas stations, and the other 50% are convenience stores located in residential or commercial areas, according to the country's roughly more than 40,000 stationed in the word of mouth.

The heat map based on the distribution of convenience stores on the IWOM platform is as follows:

In addition, let's take a look at the consumption of convenience stores from the user's consumption data.

Note: The X-axis line represents the age of the consumer, the Y-axis line represents the average amount of money spent per purchase, and the size of the bubbles corresponds to the number of times the user spends in that age group.

As you can see from the chart above:

According to national data from the IWOM platform, female users not only outnumber male users by 16%, but also spend an average of nearly 20% more than male users each time they go to a convenience store.

If we look at occupational labels, white-collar workers are much more likely to patronize convenience stores than students, teachers, or civil servants, both in terms of frequency and amount spent per visit.

Therefore, convenience store consumers: 25 to 35 years old, women, higher income earners, these labels are also symbolic of China's richest and most willing to spend money on the group, can also be said to be the soldiers must fight.

If you take stock of your convenience store and don't have such a consumer base, survival will be relatively difficult.

We often say that we hear convenience store owners complaining about the loss of money, in fact, to put it bluntly, what are your competitive advantages, is the way to survive your convenience store.

1, intimate convenience services

Curiosity Daily once collated the Japanese convenience store 1285 kinds of services are as follows:

In fact, the above mentioned payment related to the purchase of various types of tickets as well as the payment of living expenses and other services, in the mobile payment is particularly developed in China, you can use a cell phone plus Alipay can be completed.

In fact, in China, where mobile payments are very advanced, you can use a cell phone and Alipay to accomplish this.

But there are other services, such as courier, copy and fax, home delivery, a free dining area, and even free hot water, that can bring a lot of people to the convenience store.

2, constantly upgraded delicious food

I do not know if you have ever felt that the convenience store food is getting better and better?

Food is related to at least 40% of the business level of a convenience store, in order to attract consumers, the convenience stores in the food research and development is also painstaking.

Nowadays, when we walk into a convenience store, we can see buns, bento, freshly brewed coffee, ice cream, and even oil tofu and fan soup, all of which are in fact left over from the triumph of thousands of soldiers crossing the log bridge.

3, and customers to establish emotional links

In fact, the Japanese convenience store brand can be said to use the IP is really perfect, especially in the field of animation IP.

For example, the above this Monster University series, a variety of limited edition toys to allow consumers to willingly become the brand's loyal, high-frequency

For example, the Monsters University series above has a variety of limited edition toys that make consumers willing to become loyal, high-frequency customers of the brand.

However, this approach is not particularly ideal for convenience stores in China, and Rosen has actually opened a number of anime-themed convenience stores in China, such as Ultraman, Conan, and Naruto, but gave up after trying for a while. The following is a Conan-themed convenience store in Shanghai.

The future of the convenience store competition, do not let themselves become a member of the loss, mainly focus on the following three aspects:

The face of the increasingly difficult to serve the 90 or even 00 after the "front wave", they will care about the morning of the bun is hot or warm, but also care about the convenience store is interesting enough, there is the most popular Netflix food, and so on. The most important thing to remember is that there is no such thing as the most popular Netflix food.

In addition, the current domestic convenience stores are still mainly in the sale of daily necessities, frozen fast food and beverage dairy products, etc., part of the community convenience stores also comes with vegetables and fruits, courier delivery and receipt, etc., can really provide diversified services and 24-hour sale of convenience stores are not much, but now the Japanese convenience stores have been iterated out of the convenience store + Laundry + Gym, etc., which is what we have to work hard. This is the direction we want to go.

I don't think domestic convenience stores always lose. To understand this, let's start with an overview of domestic convenience stores.

There are three main modes of domestic convenience stores: One is the national chain or regional chain of convenience stores, such as 7-11, Whole Family, Xisto and other representatives of the foreign capital of the middle and high end of the convenience stores, and to the Meijia, full convenience, China Resources Vanguard and other local convenience stores. These convenience stores use a unified brand, a unified style of decoration, a unified channel of purchase, because of the large scale and strong bargaining power of suppliers, the cost of goods is lower. At the same time, these convenience stores according to the target consumer population positioning is different, the distribution of the location is different, to the white-collar target population, the convenience store location is mostly in the business district, to the general public as the target population, the convenience store is mostly in the community around.

The second is the convenience store that comes with the gas station, like EasyJet. This convenience store backed by a big tree, bring their own attraction channels, as long as the consumer demand to come to the gas can be realized sales, this is not much to say.

The third is the traditional convenience store, which is a common store downstairs in the community, especially in older neighborhoods.

Three traditional convenience stores are common stores downstairs in the community, especially in the old neighborhoods. In addition, now online businesses Jingdong, Ali and other companies are also increasing the layout of the convenience store industry, under the guidance of the new retail concept to pre-empt the layout of the physical retail stores.

Below, I talk about traditional convenience stores with examples around me. I live in the neighborhood around a store, a woman in her 50s in business, because of the proximity of the neighborhood to buy things more often, so slowly familiar. Listen to her say, her supermarket 80 square feet, monthly expenses rent of about 5,000 yuan, electricity costs an average of about 300 yuan, commodity losses of about 500 yuan, monthly sales revenue of about 50,000 yuan, sales costs of about 35,000 yuan, calculated her gross profit of about 15,000 yuan per month, after deducting expenses of 5,800 yuan, the net profit of 9,200 yuan or so, calculated as a gross profit of 30%, the net profit of 18.2% (including). her own labor costs). Although every day from 8 o'clock in the morning to 8 o'clock in the evening staring, but in the end can still earn some money.

In fact, most of the convenience stores have a gross profit of about 30%, and the chain stores have a slightly higher gross profit because they can keep the cost of goods down. If a convenience store does a good job of controlling sales and other expenses, it's likely to make a profit. General loss of convenience stores have these characteristics: First, less traffic, sales do not go , the reason is that the location of the convenience store is not good, not in the crowded area, there are very few reasons to open the store is not good character, repeat customers are less. Secondly, the rent or pre-decoration expenses are too large, fixed cost amortization is too much, resulting in slow payback, difficult to profit. Third, the daily management is not good, such as the high loss of goods, human resources waste is too much, poor health in the store and other reasons, a little erosion of sales margins.

So, as long as you can choose the right place, coupled with proper cost control, the average convenience store can be profitable. This can also be seen in the convenience store industry statistics published by state agencies.

Checking the database of the National Bureau of Statistics, from 2014 to 2018, the number and area of convenience stores across the country have been expanding at an accelerated pace, and sales have been growing year after year. From the China Business Industry Research Institute published China's convenience store investment and financing situation chart, from 2014 to 2018 many funds are entering the convenience store industry on a large scale, it can be imagined that the prospects of the convenience store industry is still relatively good . In addition, according to the chart of the distribution of net profit in China's convenience store industry in 2018 compiled by the Prospective Industry Research Institute, more than 75% of the convenience stores in the market in 2018 can make a profit, and those that are in the red account for roughly only 25%, which is not mostly in the red.

With the rise of China's per capita GDP, the rise of residents' consumption power, and the introduction of the national policy of promoting the construction of community business to improve, the domestic convenience store industry will continue to deepen its development, and it should have a good development prospect.

These are purely personal views, there are different opinions can be a piece of exchange, please correct your friends.

There is no always in the loss of this argument, steal the loss of many reasons. First, the rent is expensive, high cost. Secondly, the threshold is low, the competition is big. Rent is expensive this okay, after all, the market is so, there is profit you do, no profit on the closure, but the competition is big this day is hard, so choose a location excellent store is the first condition of the opening of the convenience store

Reasons for a few points of the first point of rent is too expensive, the second point of the flow of people is small, the third point of the price of goods is high profit margin is not big!

Costs are too high, fierce competition from e-commerce, less differentiation

Why is the domestic convenience store always losing money?

This question is a bit of an amateur (perhaps you are not accurate enough to grasp the market information in this area, there is a bias). I am a year-round with the convenience store depth of contact with entrepreneurs (FMCG agents - trading company operations), so far, has been a full twenty-two years of hands-on experience in the market. Year-round for convenience stores, large and medium-sized supermarkets, township market kiosks, and other stores to provide specific goods supply. The region (offline) has more than a thousand convenience store customer groups; annual turnover of more than ten million.

From a large number of marketing process, also grasped part of the convenience store operators, due to the lack of physical store business experience, and explore the spirit of learning, at the same time, unable to accurately grasp the consumer demand "pain points" (can not be very good to meet the urgent needs of life consumption), so ah! greatly reduced the convenience store good survival rate.

Of course, the operation of the convenience store, has a good risk control attributes (because ah...)! Nowadays, 1. diversified market economy, 2. homogenization of goods, 3. competitive market sales). As a supplier (wholesale market for convenience stores to provide sources of goods), the competition is even more intense, in order to obtain a good living environment, then, the market has appeared in the "unwritten" professional conduct, is the perfect after-sales service, for example, the sale of the product does not fall, the expiration date of the product, out of the product, in the process of transportation, leading to The outer packaging has broken products ......, are unconditional return.

For dealers, "off-season to do service, peak season to do sales", for convenience stores, will take the initiative to provide more money to occupy, but ah! Convenience stores enjoy the convenience of the policy of merchandise (fully capable of fast in and fast out).

Besides, the social and economic environment, a good, with a good market development cut machine (and no corresponding national tax, local tax to bear), do not need to pay any fees to the state treasury. It's a completely self-supporting, free-standing profession that is not subject to any conditions.

For the convenience store business, most operators, are a husband and wife store business - independent marketing model. Not to mention the fact that workers' wages, how can there be a loss?

The only fundamental factor leading to losses, is that, as life just need industry, but also any other industry, can not be compared to the characteristics of the - FMCG, so ah! There are huge numbers of people working in this society.

At present, I live in the region, the county has 29 townships, a total population of 1.6 million people, due to the huge outflow of population, with the county census bureau, mapping survey, now left behind, no more than six hundred thousand people, the most obvious characteristics of these left behind, is the "old, weak, sick, disabled". Each township market, large and small supermarkets, convenience stores, kiosks, almost have the number of dozens, or even, more than a hundred.

To be honest, I run this trading company, weekdays, the total sales of products in a year, not as much as a "New Year's Day" sales of the total (accounting for 60% of annual sales). Take the liquor industry, for example! Annual sales of gift wine, only accounted for the Spring Festival sales, not more than 35%. Behind this figure, hidden many factors, for example, a large number of outflow of young laborers, is the main consumer market. So yeah! Whether it is a convenience store, or product agents, as a sit-down business operations, then, must have a "flexible" business mindset resilience, in order to cope with the market consumption of unfavorable factors (as the content of the marketing, here, will not be elaborated in detail, I hope that all of you, if you need to friends, you can further communication, private chat! Thank you!) .

So yeah! As the mainland's market economic situation, roughly

such a situation. It's not just the "epidemic" that's weakening consumption, it's the massive outflow of workers - the young labor force.

I'm the Entrepreneurship Classic Forum, sharing more entrepreneurship content.

If you want to run a good convenience store, it is still a test of the level of operators. Of course, the convenience store wants to make a profit, the most important factor: location, location or location. Location directly determines the flow of people and customer base, followed by the impact of performance. Opened in Beijing's China World Trade Center, 7-11 performance than your downstairs family better, this is undoubtedly

Why is the domestic convenience store is always in the loss? As many entrepreneurs often say, there are many reasons for failure, but there is only one reason for success: cost control. The reason why many domestic convenience stores are losing money is also because the cost is not controlled. Convenience stores have those costs?

1. Rent costs, this is one of the biggest expenses we open a convenience store (except for the home front). A good location with high traffic, but high rent. Generally seems to be in the station or neighborhood entrance location is better. This cost is not recommended to reduce, because it is the source of our customer traffic.

2. Labor costs, in our country a large part of the convenience store are small two people in the do, so the labor cost is not the bottom. Many people only see their earnings, but ignored their pay. When they are busy, they may not even have time to eat or go to the toilet. A lot of small stores have to open the door at 8:00 in the morning, has been open until 11:00, even if they have been sitting there also feel particularly tired.

3. The cost of utilities, heating in the winter, refrigerator and air conditioning in the summer, is a big expense. This cost is not personally recommended to cut. Because the guests into the store, the summer, the store is hotter than outside, people ran early, but also do not want to come to the second ah.

4. Commodity costs, because it is a small store, our commodity prices are certainly not as cheap as the big supermarkets. Even many of them are much higher than them.

Now that all the factors affecting the profitability of our small store have been identified, then how can we make it earn money?

First of all, there should be no way to lower the rent, because the landlord will tell you that you do not rent there are people. So we need to find ways to reduce the cost of rent for all goods. That is, to fit as many goods as possible in a limited space. In the Japanese there is a very famous department store called Don Quixote, the store is very small but has quite a lot of things, all kinds of goods, everything. It's also a cheap store, and there are about 300 branches throughout Japan. A friend who went there mentioned it to me, and he said that there are only goods you can't think of, and nothing he can't stuff. A dozen square meters may have tens of thousands of kinds of goods.

Actually, look for cheap sources. The reason why Poundland has caught fire so quickly is because they buy things cheap. The more the economy is in the doldrums, the more people like to buy cheap things. So if you open a convenience store, our sources are important, if you can consistently find good quality and cheap goods. You can definitely make money. We can go directly to the manufacturer, many are willing to cooperate with us. Because there is no middleman to earn the difference in price.

The last thing is to try to merchandise neat. Note that it is not neat, it is neat, do not have dust on it. Regularly clean out expired goods. This is important, if I go shopping and there is dust on the merchandise I definitely don't want it.

All of these are my personal opinion, the Japanese have an interest in Don Quixote friends can send me a private letter oh.

The main thing is to choose a good location for the convenience store, to examine the surrounding environment, how many convenience stores or supermarkets, how many people, the level of consumption, etc., and not most of them lose money, according to my understanding of a lot of money is to make money, our family is to open a supermarket, many times and the location of the population is very relevant, sometimes even if next to the mega-supermarkets can also be a small supermarket opened a very hot

Competition in the same industry, e-commerce competition, high rent and labor, pin enough to join the party's squeeze, are loss factors

  • Related articles

copyright 2024 Traditional Culture Encyclopedia All rights reserved