[China Glass Network ] "Returning" to China's strange momentum
The entanglement of foreign retail enterprises in China has never been as obvious as it is today.
Best Buy, the global retail giant, announced that it will reopen two stores in Shanghai in October. The news that Best Buy shut down all of its own brand stores in China in February this year is still in the ears. The speed of this "return" is almost "the thunder of lightning."
Not only is Best Buy, but in the first quarter of this year, there is a lot of Home Depots that have withdrawn from China's momentum. Recently, new news has also been sent: The Home Depot, a large shop in China, which was likely to be shut down this year in the closing of the store, was changed to - "It will stay for a long time!"
The trend of foreign retail sales “returning†to the Chinese market is evident.
Let’s take a look at the foreign news that is closer to China. For example, DHL’s “Evacuation from China†news in July, I really can’t believe that foreigners are going to go, or Leave.
However, what are the common factors behind these events that can be grasped?
Foreign retail = high end = hit the wall
The author has made a formula for the development track of foreign retail enterprises in China. Foreign retail = high-end = hit the wall.
Foreign-funded retail companies come to China, and once they embark on this formula, almost the overall situation has been set.
For example: Take Best Buy as an example. Best Buy has been working hard to copy its proud "customer-centric" DIY experience sales model. The cost of copying the original model is very high, which makes the expansion of Best Buy's store size slow down. Without the scale, the purchase price of Best Buy products has not been able to keep up.
Although shopping in Best Buy is much more decent than the "Chinese model" that is recommended by the salesman and bargained. But the more interesting story I heard about Best Buy is that there are Shanghai customers who will go to Best Buy to DIY the products they want, and then go to the nearby Gome and Suning stores to place orders!
The “home DIY†Home Depot with the “return†trend also has this problem. DHL, which just wants to “withdraw from China†in July, is even more so: DHL, which is going to “retail†its own express delivery business in China, plans to enter the relatively low-end market of domestic express delivery, but DHL introduces a high-cost management system. It has become a standout in the industry. According to reports, the domestic SF Express, which is taking the high-end route, has a business of 30 yuan, and the DHL charge is 112 yuan! Such high-end high-end, it is almost impossible to "evade" from the Chinese mass market.
It can be said that when foreign retailers go to the Chinese market to play high-end, they will fail, no matter how good the "model" behind you.
"High-end" often sticks to "mode"
Foreign retail companies also have success in China, such as Wal-Mart and Carrefour. The success of Wal-Mart and Carrefour is precisely because it is focused on the low-end consumer groups. If it is also active or passively focused on high-end consumer stores, it will make people feel a cold sweat. At least so far, the classification of Chinese consumers is not obvious, and the risk of directly doing high-end market in the retail industry is very high.
Basically, the Chinese market is quite tolerant to foreign-invested retail enterprises. Foreign-funded retailers in China do not play the mysterious, do not “fake foreign affairsâ€, take high-end and even high-end, and the odds are great.
But one question came out. Why are so many foreign retail companies frequently “biased†in China? Always "low" does not come down?
Judging from the problems that are currently exposed, more is the case - when foreign retail retailers have an eye-copying original model, they often "copy" the costs together. For example: the cost of the DHL management system.
It should be said that investing in China's retail industry is tantamount to re-starting a business! A copy of the business model and management mode. And this is a more thorough entrepreneurship, because it often finds that there is a big gap between the requirements of Chinese suppliers and consumers – the essence of entering China is a re-starting business.
Talk less about the mode and talk more about starting a business. If you just “connect†the successful model to the new market, there are few who do not lose – this advice is actually valid for all companies planning to enter new areas.
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