Source: Cai Chai Private Board, head picture from visual China.
Status quo of Community Group purchase Development
1. Nowadays, the cost of online traffic is getting higher and higher, the comprehensive cost is low, the traffic dividend is available, and the community group purchase model based on the mutual trust between the neighbors is emerging.
2. The mainstream mode of community group purchase: community as a node, online community building, offline delivery, platform to provide supply chain, logistics warehousing and after-sales support.
3. After the trading technology of WeChat group, WeChat payment, small program, etc. is mature, the technical conditions of the community group are ready to be completed.
4. Freshness is a very important category for community group buying.
5. At present, community group-buying development is focused on third and fourth tier cities, but in the long run, is not necessarily the best choice.
6. The threshold for community group purchases is not high, and the future “Hundred Regiments” is inevitable.
7. The general completion of the A-round community group-buying enterprise is only a preliminary proof of the feasibility of the model, but whether it can meet expectations, but also depends on the next development.
Recently, community group buying companies such as Ten Hui Group, You, Me and You, Food and Enjoy Club, Stay Radish, Neighborhood One, Koala Selection, Squirrel Spelling and so on have successively obtained financing. A growing number of new projects are beginning to emerge.
In addition to the O 2O e-commerce company per day under Youxian daily Amoy together has recently joined the Bureau community groups. Pinduoduo through the investment in Shanghai insect mother neighborhood regiment into the Bureau community group.
A large number of capital, including Sequoia Capital China IDG capital GGV Capital, GSR Ventures and others have been involved in this field.
At present, there are hundreds of communities across the country, basically converging in playing methods. "Bao Ma Community" develops community group buying business. It develops community group buying business at the speed of expanding cities, cross-regional management capabilities, supply chain capabilities, commodity systems, and technical capabilities. Brand strength and other aspects have their own advantages and disadvantages.
The Common Play of " Baoma + Community":
1. Looking for community KOL, also known as "head", this kind of people are often idle at home's treasure mother;
2. "head" organization WeChat group, namely virtual shop, "store" member is the mother of the community;
3. The platform provides brand, technology, product, logistics, customer service and other related services. When the “Head of the Head” collects the order, the platform will deliver the goods from the city warehouse to the “Head of the Head” home, and the community consumers will pick it up, usually order logistics. The time is 3-4 days.
The founders of this group purchase company are basically post-80s, with fresh experience, grassroots background in the majority, rural and hometown have a great deal of emotion:
Neighboring one founder Xiao Zhilong, from the Guangdong Heyuan small village. The earliest fruit warehouse opened in Suzhou, wholesale prices to sell fruit to ordinary people, breaking the hidden rules of high-priced fruit.
The founder of the 10th group, Chen Hao, also comes from the countryside. Harvard University graduated and decided to change the countryside through community group purchases and make the town a better life.
Dai Shanhui, founder of the Edible Society, is from the Southern newspaper Industry. As a media man, he knows more about how hard it is for ordinary people to survive. His dream is to link poor mountain areas with new urban residents.
You and I, your founder Sun Yuanbo, are from Laizhou, Shandong Province, a major agricultural province. His dream is to find and share good fruits and genuine products in the country so that neighbors can feel the community's proper temperature.
wu bin, founder of Qun Lianlong, from Guangxi's agricultural province, made a serious loss in doing fresh e-commerce before. Later, he gave full play to his technical advantages and made the earliest " Qun Lianlong" small program in China based on the concept of " protecting users and warming users" so as to make the group purchase of community professional individual leaders more efficient.
1. Age: 26-60
2. Education level: above junior high school, be able to use social application such as WeChat and mobile phone skillfully.
3. Geographical attributes: In the early stage, it was a larger city such as the first line and the second line. In the later stage, it could be gradually extended to the 5th line city and even the rural areas.
4. occupation: full-time wives, non-manual workers, etc. who have a certain amount of leisure time during working days.
5. Economic income: the annual income of families or individuals is more than 60, 000 yuan.
6. Disposable income: annual net disposable income is over 20,000 yuan.
7. Pay sensitivity: people who have high pay sensitivity and pursue the advantage of cost performance.
8. Hardware equipment: at least one smartphone.
1. Participate in group buying recommended by people inside the community, with high trust and low possibility of false propaganda. Purchase is guaranteed.
2. Compared with ordinary shopping prices, group purchase prices are flat or lower, and the origin direct sales guarantee freshness.
3. There are offline commodity return and exchange channels and timely access to information channels, than direct online shopping to facilitate.
The main factors affecting user usage:
1. Whether to carry the access equipment with you.
2. Whether the network is smooth.
3. Do you have the leisure time to pick up the goods and pay attention to the information.
Fresh food is the key category
Fresh as a flow product, in the category structure is very critical. Because in the community scene, to cultivate online consumption habits, must be through rigid demand, high-frequency categories to do.
Fresh e-commerce has encountered many problems in its development process, such as the lack of real improvement in supply chain efficiency and the increasing cost of online traffic, while community group buying has provided it with a new possibility.
On the one hand, it is possible to operate a wider range of commodities, such as fresh, community stores are very difficult to manage fresh, but through the way of pre-sale can be achieved.
On the other hand, the loss of stores can be better controlled. Online pre-sale means that stores do not have inventory, or less inventory, the entire operation can be based on online orders to distribute goods, relatively better accuracy.
At present, enterprises with strong supply chain foundation, such as fruit shop, Yonghui, etc., to carry out related business is very advantageous.
[Food enjoyment] involves four categories of fresh ingredients (family table consumption), casual snacks, beauty care, and household items. At present, sales of fresh foods still account for the highest proportion, accounting for 60% of total sales.
Four major categories-fruit, three meals (seafood, meat, dairy products), food nuts, household goods.
[You and me] Among them, fresh food accounts for 40%, in addition to rice, grain, oil, daily necessities, cosmetics and other household consumer goods.
Advantages of Community Group Purchase
1. Flow bonus and low cost of getting customers: Compared with the expensive flow cost on line, the new channel has flow bonus and can reduce the cost of getting customers by using the acquaintance relationship chain.
2. Good delivery experience and low distribution cost: replace the express logistics with floor-to-ceiling, reduce the logistics cost, and collect and distribute around the community, the delivery experience is better than the e-commerce, and the stability is stronger.
3. Light operation mode and easy to scale replication: Compared with the heavy operation of the store, community cabinet, store + cabinet mode, the high rent/high labor cost of the store opening mode is eliminated. Adopting the "extreme single product + pre-sale model", the operation mode is light, the order operation difficulty is relatively low, and it can quickly land in the country.
4. Pre - sale mode reduces wastage: it reduces wastage costs encountered in the past fresh e-commerce mode, and after the demand is obtained in batches, the platform can lower costs when purchasing from upstream.
More importantly, community group buying meets the capital's expectation for multiple growth.
The future market size of community group purchases is massive and can involve every community in the city and every resident gathering point in the countryside. A rough estimate, assuming a community monthly sales of 30,000-50,000, a city of 1,000 communities, annual transaction volume of 400-600 million, hundreds of cities across the country can be replicated, the market size of about 40-60 billion.
However, for now, the market size of community group buying is limited to daily shopping and supplementary shopping after the online shopping of Jingdong and Taobao.
Risks and challenges
The risks and challenges that community group purchases may face are mainly concentrated in the following aspects:
First, the supply chain.
There are four distribution methods of community group purchase: the first one is one delivery item; the second is the place of production to be sold to the city warehouse, the city logistics to the community, the self-delivery or delivery to the door in the community; the third is to sell the storehouse directly to the user; The fourth is timely distribution, that is, customers in the community WeChat group order can be delivered from the front warehouse to the user's home in half an hour.
If you want to use fresh drainage, and can achieve stable supply, the biggest challenge is the supply chain. Because fresh life is very short, using "fast" to get users and is very hedged proposition.
Fresh supply chain is extremely scattered, even fresh B2B players enter the market, but also have advantages in the subdivision category, it is difficult to support the demand of community group purchase, so the standardization of fresh supply chain and the ability of regional integration will be more important.
Second, the cost.
It is a very long process from the place of origin to the first batch to the second batch to the front warehouse. The cost of goods and the investment of personnel will be relatively high.
From the perspective of consumer experience, customers must hope to have more choices of goods, but if there are many items offered through group purchase, the cost will increase and the efficiency will decrease. For example, more loss problems.
From the logistics point of view, the whole warehouse distribution must be the best way of efficiency and cost, but when this kind of distribution becomes the distribution for hundreds or even thousands of communities, the logistics cost will rise instead.
Third, operation and management.
The business model of community group buying is too dependent on community partners or community leaders. This is a potential hidden danger. For example, the problem of “head of the group” will almost come out.
In terms of urban development, on the one hand, it benefits from a light model and can sink quickly. On the other hand, it also tests the resources of various parties and organizations in the cross-regional and localized management.
If community group purchase only depends on scale to do price difference, do not build internal capacity, can not rely on their own ability to make the value of users greater, are not far away.
Fourth, the software system.
Use a connectable system. Agile response C-order orders require efficient cooperation between production, supply and sales. If the systems used by the four parties are isolated and not connected, they must be manually exported to import and order. The agile response is an empty talk.
Ten Pain Points of Community Group Purchase Company
Overall profit margins are generally low and operating costs are high.
It is difficult to provide very good products continuously;
The logistics time is difficult to control because it does not press the inventory, and the pressure on the inventory is worried about the pressure on the goods;
The management of the head is inexperienced and the recruitment of the leader is difficult;
When the management of the head of the regiment is relatively chaotic, there is the phenomenon of leapfrogging or three delays;
Many community group purchase leaders have their own sources of goods will be in the group with private goods, directly affect the platform reputation;
The experience of end-user service is difficult to control, and there are many unstable factors in Baoma's service quality.
The loss of users, the activity within the group has a clear downward trend;
Contact with the user has always been weak. How to trigger and awaken the user, is a deeper level of interaction;
Community group purchase is not too far from the future expectations, just hope to take advantage of tuyere to make money and package for sale.
Future development trend
One option is to do it yourself or as a platform.
The former needs a deep supply chain, and the profit mainly comes from the gross profit of commodities. The latter integrates businesses and collects commissions. Compared with the self-management model, the platform does not need to integrate its own supply chain and is faster, but the risk is that the products are provided by the merchants and the quality control cannot be very strict. The problem of fake products coming out in succession is a lesson from the past.
Platform - only mode:
The platform needs to provide more comprehensive docking, promotion, organization, logistics, aftermarket services for merchants and customers. To have community resources, business resources, have a certain technical and operational planning and service capacity of the team is better, the platform and team requirements are high.
Self - support model:
Generally strong capital-backed large-scale ecommerce, supply chain enterprises, manufacturers and other transformation to operate the platform.
1. Many suburban farmers build their own communities to sell their products and drive them to the community.
2. Supply chain enterprises selling land recruit partners in the community. Community partners are responsible for running WeChat groups in their communities, collecting orders to supply chain enterprises after sales, and distributing them to communities.
3. The group owner of the community WeChat group spontaneously conducts retail sales. The supply chain only supplies the community group owner as the nearest party to the user according to the instructions of the group owner, and knows the user's needs and the most understandable dynamics.
Another option is to develop their own community, or M & A small-scale players, or both.
There are two different mentalities:
One is to polish a single community model to the extreme ( make deeper user connections ) and then start to expand. One is to encircle the land in Happy Valley first and then operate it in a refined way.
Two Key Points for Community Clubs to Survive in Future Competitions;
The first is the flow capacity, that is, the organization of "head" to obtain the speed of community users;
The second is financing ability. Only after obtaining financing can it be possible to reverse integrate the traditional supply chain enterprises. Of course, in addition to ability, luck is also important.
In December 2017, Dai Shanhui, the former vice president of life, founded the Food and Drink Club, a social e-commerce platform based on the community group buying model, which mainly focuses on fresh food, casual snacks, beauty care and household items.
Through a unified summary of the daily needs of families in each community, we together issue orders, through centralized procurement, centralized distribution, reduce the intermediate circulation and increase links, so that consumers can really enjoy the benefits.
It recruits "Bao Ma" from various communities for product distribution, builds communities online, and delivers offline. As an important distribution node, Bao Ma is responsible for front-end sales and online community maintenance, each covering 300 to 500 homes. The establishment of food will cover more than 30 cities in 15 provinces across the sales network of tens of thousands of residential areas.
The Food and Enjoy Club provides Baoma with supply chain, logistics storage and after-sales support. In addition to providing Baoma with a unified brand, it also provides a complete operation system and a complete set of operation tools.
At present, monthly sales of platform more than 30 million yuan, and in a single community, a single city to achieve positive cash flow, positive profit, the next year, the expected layout of 100 cities across the country, sales exceeded 2 billion yuan.
It tries to establish itself in the hundreds of billions of markets of fresh food industry through mode innovation. At present, the fresh products sales account for 60% of the total sales.
But the purpose of the feast goes beyond the fresh industry, and with the establishment of channels and the sound infrastructure, it can expand from fresh circuit to other "household consumption scenario" track at lower marginal cost.
Neighbor one officially launched in March 2018. Chairman Xiao Zhilong was responsible for the annual turnover of 10 billion company marketing business before the original fresh fruit 1 CEO, venture. After the founding of fresh fruit 1, he had traveled 50 core production sites around the world to excavate products.
The co-founder of neighboring CEO Huang Xing Huawei's original Fresh Fruit No. 1 had more than 10 years of real estate agent management experience before the establishment of Fresh Fruit No. 1.
Fresh Fruit No. is a new fruit retail enterprise. The offline 500-square-meter warehouse-style member store, online WeChat public number, WeChat group drainage, to the store to complete the self-raising. In the past three and a half years, the fresh fruit nickname has achieved annual sales of 200 million yuan.
As the single item with the highest repurchase rate and the strongest stickiness, the neighboring 壹 team has accumulated sufficient capacity on this.
In terms of category structure, there are four main categories of neighboring oysters: fruit, three meals (seafood, meat, dairy products), food nuts, household items. These four categories collectively point to a 24-hour household consumption scenario, with core consumers ages between 25 and 45.
The next-door position is "good goods are not expensive", and blindly low-price strategy is separated. First of all, must be good goods, and then continue to improve supply chain efficiency, to achieve maximum value for money.
In terms of group operation efficiency and urban expansion, according to the data provided by the company, since it was officially launched in March 2018, more than 50% of the compound growth per month has expanded to multiple cities.
You, me, you
You and me are your way to connect upstream and downstream through the “head of the team”. The work includes managing the community, product recommendation and customer pick-up. The role of the head is more like a virtual delivery point and group sponsor, and his role in recommending goods in the community is critical.
Through the WeChat community, the head of the team will quickly receive the order of the community that they are responsible for. At the other end of the platform, the head of the platform can directly contact the origin to directly ship the goods.
On the second day of the order, the goods are sent from the country of origin to the city's general warehouse. On the way home from work, customers can pick up the goods at the head or at the designated location. Through this model, you and me achieve the lowest fulfillment cost and zero loss of fresh distribution.
You, me and you take fresh food as the starting point. Data show that for strawberries of the same production base and brand, you, me and you are cheaper than both traditional fresh e-commerce and street stores in 10 yuan, and the unit price is about 30 % cheaper.
The data shows that the platform fresh food accounts for 40%, in addition to rice, grain, oil, daily necessities, cosmetics and other household consumer goods. In addition, the platform gradually increases the proportion of you and my own brand. At present, the proportion of private brands is around 5% to 10%, and it is expected to reach 20% to 30% in the future.
At present, you and I have expanded to more than 10 cities, tens of thousands of residential areas, an average of 100000 per day, and maintain a 30% growth rate. The platform expects to add 20 cities by the end of this year and another 100 cities next year. The main task of the platform is to quickly occupy the second-third and fourth-tier cities rather than attacking the first-tier cities.
Note: this article is based on the information published on the Internet.
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