Welcome to hybrid world of shopping
stores with online services.
Known as online-to-offline, this fresh food startup is racing ahead and has steadily expanded its network of supermarkets since it opened its first outlet last year. Now, it has nine stores in Shanghai, one in Ningbo and one in Beijing.
Most supermarkets have more than 3,000 kinds of products. In the seafood sector, customers select what they want to buy, pay for it online before having it cooked to order.
Or they can do the same online and have their orders delivered within 30 minutes as long as they are within three kilometers of the store.
“Up to 80 percent of the company’s customers are born in the 1980s and 1990s (or Millennials),” said Hou Yi, founder and chief executive officer of Hema Xiansheng. “They are internet natives.
“This generation has grown up in an increasingly affluent China,” he added. “Therefore, they care more about quality and are less sensitive to prices.”
Still, what is important is that the food is fresh and delivered on time.
As soon as you walk into a Hema Xiansheng supermarket, you hear a rattling sound above with shoppers and employees rushing around with mobile devices, picking up produce and other products from the shelves.
They then bundle them into shopping bags before some are clipped to hangers. At the touch of a button, they are lifted toward the ceiling on overhead conveyor belts.
By using this business plan, the offline stores double as the warehousing, sorting and delivery centers for its online supermarket.
Last year, shopping online was worth 4.7 trillion yuan, an increase of 24.7 percent compared to 2015, according to iResearch, a market consultancy based in Beijing.
“The keywords for retailers are equality and interaction,” said Wu Zhige, associate research director at IDC China. “Retailers should create new shopping models and advance the digital transformation of their distribution channels.”