China Food

With 100 million yuan of a + round financing and niudaji, a new community chain retail brand, how to upgrade the consumption of beef?

beef workshop closer to consumers.
Where will the Internet go?
This is a question that Wu Haijin, who started his Internet entrepreneurship project during his university, has been thinking about before he founded the new retail brand “niudaji” in beef community.
“After thinking for many years, I think (Internet) may go to the industry.” Wu Haijin said when sharing his entrepreneurial experience with the red bowl society. After graduating from University, he worked in hard egg technology, IOT supply chain platform, responsible for enterprise products, e-commerce, channels, etc. he left the company to start a business at the end of 2016.
“If the Internet is used in the industry, which track should I choose? In 2017, I could clearly sort out the answer from my cognition: when choosing the direction of entrepreneurship, we should follow some conditions. First, the industry should be large, and the market opportunities will be large only after it is networked; second, the two ends of the industry should be scattered, and if both ends are giants, there will be great obstacles.” Wu Haijin said that the beef industry happens to meet these two conditions at the same time.
“At that time, the stock scale of beef in China was about 500 billion to 600 billion, with a compound annual growth rate of more than 16%, meeting the first condition; at the same time, the beef industry was particularly scattered at both ends, with small and medium-sized pastures in the upstream and almost no large pastures; the downstream was basically a farmers’ market, followed by small fresh supermarkets, various catering processing plants, etc., extremely scattered, and there were no large retailers. I thought there was a great opportunity at that time, so I got into this Industry. “
Wu Haijin introduced that after selecting the track and starting his business, he was exploring the industry for three years from 2017 to 2019. The whole industrial chain has been tried from self built pasture cattle raising to trading, circulation and Internet retailing.
“By 2019, we have developed a better model in one of the links – opening retail stores in the community. After this model came out, we began to focus on this, precipitate specific business models and develop them.”
Wu Haijin said that in 2020, the team successively opened dozens of community retail stores in Shenzhen, mainly selling fresh beef, which is also niudaji 1.0 store. “Then it is to build large-scale management ability and chain standardization ability, including supply chain management. It basically ran out the new retail model of beef community.”
After July 2021, niudaji positioned itself as a “new chain retail of beef products in the community”. With the brand concept of “eating beef every day and strengthening the Chinese people”, niudaji is committed to providing consumers with fresh and now made beef products with a sense of quality. The store form has also been upgraded from 1.0 to 2.0. It not only provides fresh beef, but also provides prepared vegetables and finished vegetable beef products such as stewed beef, roast beef jerky, boiled beef offal, beef fried string, beef pineapple bag, beef brisket rice and flour.
“At present, the floor efficiency of niudaji store is 7000-8000 yuan / month, the per capita customer unit price is about 50 yuan, the average gross profit margin of products is 50%, and the conversion rate into stores is 60%. 2.0 stores, the average annual income of a single store is 4-6 million.” Wu Haijin said.
Last month, Niu Daji announced the completion of RMB 100 million a + round of financing. This round of financing is led by Shenzhen bear capital and followed by the old shareholder Xianfeng Changqing. This round of financing is mainly used for brand supply chain construction and digital construction.
Further exploration of beef consumption under the upgrading of consumption
Wu Haijin summarized an important opportunity for Niu Daji to run out in the community retail link as “consumption upgrading”.
“Compared with other major meats, beef belongs to high-quality meat with high protein and low fat, with high nutritional value. Under the background of consumption upgrading, with the improvement of people’s economic ability, people will naturally choose to eat better meat, and beef is the first choice.”
According to the data given by the General Administration of customs, since 2017, the growth rate of China’s apparent beef consumption has been maintained at more than 4%. It is estimated that the apparent consumption of beef in China will exceed 9 million tons in 2021, and the scale of beef market will exceed 800 billion. However, although China’s total beef consumption is increasing year by year, the per capita consumption is only 6kg, which is lower than the international per capita consumption of 7-8kg.
The United States, a major beef consumer, consumes 26.2kg per capita every year, with a consumption difference of 20.2kg/person. Meanwhile, neighboring Japan’s per capita consumption of beef is 7.5 kg. On the whole, China’s per capita beef consumption is still at a low level in the world, and the scale of beef industry is rising steadily.
“According to our analysis, a large part of the reason lies in the relatively backward channels and low efficiency of China’s beef market. Many families with purchasing power and demand have no good channels to buy high-quality beef. Under this background, we are given the opportunity to establish retail channels. How to establish them? We are based on a very simple idea: to build this channel in the place closest to consumers, we go to ta instead of TA Let consumers come to us. “
In 2018, Niu Daji opened its first retail community store in Guiyang, which also verified the vision of the team and became the development path of the whole brand. Wu Haijin told hongwanshe that after selling beef products in formed community retail stores, Niu Daji began to upgrade the stores from 1.0 to 2.0.
“Niudaji 1.0 is a very light model. The store area is only more than ten square meters, and almost only sells fresh beef. It is equivalent to a community retail MVP verification we do. This is a basic method commonly used in the process of making products in the Internet industry. That is, we use the minimum and lightweight cost to verify whether we can improve the penetration rate in the community and whether large-scale and standardization can be run through.”
Wu Haijin further introduced that by July 2021, Niu Daji had opened nearly 100 version 1.0 stores to establish the capabilities of site selection, data model, team, recruitment, training and so on.
“In this process, we are thinking about the differences and new needs of consumers for beef in terms of specific consumption scenes and habits compared with the past. We find that a large number of consumers have upgraded their demand to eat meat with higher protein, but there is a threshold for busy young people to cook at home.
In the transaction structure, we should reduce transaction costs and improve product experience. In addition to the ingredients, can we also make beef for consumers? “
So far, Niu Daji’s team has built a version 2.0 store to locate the “community beef workshop and central kitchen”. On the basis of fresh beef, it has added baking, oven, stewing and other equipment to provide beef related cooked food products. Create richer consumption scenarios and take them as a stable store model. “All 1.0 stores will be upgraded to version 2.0 this year”.
In addition to the abundance of products, Niu Daji has also made a new brand on the brand side, with the brand slogan of “eating beef every day and strengthening the Chinese people”. “We also designed a door of niudaji beef workshop, and a ‘big black cow’ will be placed at the door of each store as a super symbol to strengthen consumers’ awareness. We directly tell consumers that we are the most professional in making beef and encourage everyone to eat more beef.”
Internet thinking empowers new beef retail
Once a practitioner in the Internet industry, Wu Haijin applied the thinking logic in the development and operation of Internet products to Niu Daji’s development.
In product research and development, data-driven is a major feature of Niu Daji.
“We are positioned in the community beef workshop and will launch diversified meals serving daily life around various methods of beef ingredients. For example, beef brisket powder, rice and noodles instead of dinner; baked beef jerky, on-site baked beef pineapple bag and other pastry snacks are very popular in breakfast and afternoon tea scenes. In general, we will rely on big data and focus on the most popular basic models in the market to deepen our products And innovation. “
Wu Haijin introduced that, for example, Niu Daji’s flagship product, curry beef pineapple bag, is an innovation based on the traditional product form of Cantonese pineapple bag, adding curry beef stuffing. As soon as the product is on the market, it is welcomed by a large number of consumers.
“In product research and development, we will also use the AB test method commonly used on the Internet. For example, different product managers will have different ideas about whether beef brisket is used in flake or block. We will choose different stores with similar conditions for ab test and determine the final form according to the data feedback. There are many such methods. Although they are very basic in Internet operation, they are of great benefit when applied to chain retail.”
Hongwanshe learned that in niudaji 2.0 stores, there are more than 100 SKUs, and fresh food accounts for 30%. The other products are prefabricated dishes and finished dishes. Among them, curry beef pineapple bun, instant stewed beef, roast beef jerky and Cantonese beef miscellaneous cup are the most popular star products in the store. The sales of stewed beef in a single store can reach thousands of yuan a day.
“We attach great importance to user experience and will not make a product that is not delicious for standardization. Therefore, our R & D elimination rate is very high, and more than 20 products will be eliminated every month. Even if our industrial processes are standardized, we still insist on ‘doing it now’ in stores, and ‘doing it now is delicious’ at a certain level.”
The reason why Niu Daji can have such diverse and complex product forms depends on the sound store infrastructure. “It’s a bit like building a small food factory, and each production line has been installed”.
Diversified products and consumption scenarios have expanded Niu Daji’s consumer population beyond a certain age group or circle. “Most families in the community, men, women, young and old, are our users.”
Wu Haijin introduced that above product research and development, the standardized operation ability of chain stores is one of the important barriers of Niu Daji. “Our coo was responsible for 711 operation in the 1990s, and later founded 7-day hotel as a co-founder. He has very rich experience in Chinese chain retail management. This enables Niu Daji to have large-scale recruitment, training and management capabilities; at the same time, we also integrate mature digital capabilities into the operation system to improve efficiency.”
On the one hand, Niu Daji reduced the loss of goods in circulation through standardized management process and digital system; At the same time, the team creatively adopted the “natural circulation” method to make the fresh beef that was not sold out on that day into semi-finished dishes or finished dishes, which effectively solved the problem of tail goods.
Overall, Niu Daji’s moat is mainly reflected in three aspects:
“First of all, in the beef market, the supply chain itself is a great barrier, which requires cognition, experience and investment. In the past few years, we began to cultivate the supply chain from baoranch and accumulated profound resources;
At the same time, in order to do a good job in products and large-scale expansion in the industry, it also requires the ultimate standardization ability and digital ability, which also need to be accumulated;
At present, the store form of beef workshop is initiated by Niu Daji. It is a very new model, which needs continuous trial and error and long-term accumulation. We have the first mover advantage. “
Wu Haijin told hongwanshe that Niu Daji has opened nearly 200 direct stores in Shenzhen. “In terms of site selection, the number of permanent residents is an indicator we attach great importance to, that is, in the first, second and third tier cities, commercial housing communities with more than 2000 households are the first choice for niudaji to open stores.”
Wu Haijin said that the main focus of Niu Daji’s team work this year is the replication scale. “Our store model has run very well. Now we need to replicate the scale. It is expected to open 400 stores by the end of the year; at the same time, we will deepen the supply chain at the same time.”
Author: Li Yang; Source: hongwanshe (ID: hongwanshe 2020), reprint has been authorized. Reprint authorization and media business cooperation: Amy (wechat: 13701559246); Foodaily Expo 2022] in line with the original intention of providing the whole value chain and one-stop industrial innovation services for the industry, foodaily Expo 2022 (2022.05.31-06.02, Shanghai) is further upgraded. In addition to the upstream and downstream of the food industry, it also covers and gathers multiple resources such as e-commerce, social media, traffic, channels and capital, aiming to bring you an annual innovation feast. Here, products, content, technology, marketing and other aspects related to food & brand innovation will be presented in the form of “professional exhibition + innovative content + interactive experience”, breaking through and differentiating in the consistent form of industry exhibition.
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