NŌME runs fast enough, but the supply chain and design team have not responded.

The home business star company NŌME is suffering from the enemy.

Recently, a “NŌME Home Franchisee Media Communication Meeting” was held in Beijing. The NŌME franchisee representatives called the brand at the meeting, and the franchisees faced a large operational dilemma in the actual operation process. They hoped to take back the deposit and other related expenses by means of exiting the store and stop the loss in time.

According to the “Economic Observer” report, the “larger operational dilemma” referred to by franchisees is mainly manifested in two aspects. On the one hand, the store is having a difficult profit. According to the feedback from the franchisees, although in the initial stage of opening the store, NŌME gave a relatively favorable store deposit, the franchisee also used a familiar decoration team to save the decoration cost, but its store in the shopping center is not only the land price, staff salary and marketing. The promotion expenses are higher than the general stores, but the passenger flow and turnover have decreased month by month, resulting in long-term franchisees are unable to make ends meet.

On the other hand, some of the franchisees began to have broken supplies, and some goods also had defective problems, which means that the long-term operation of the store is hopeless, and the franchisees are determined to retire. The franchisee’s goods were cut off, and the supplier’s delay in recovering the loan was delayed. Among them, the clothing category is the hardest hit. Suppliers of T-shirts, knitwear, jeans, down jackets and other products for NŌME have allegedly defaulted on millions of loans.

In addition to the ups and downs of the brand industry chain, NŌME is still closing stores. According to statistics from many media, NŌME has closed at least 14 stores in just half a month. Just a few days ago, NŌME closed the first store in Shanghai.

The relevant person in charge of NŌME responded to “Winner.com”, saying that Wujiaochang Wanda Plaza Store is a direct store of NŌME, based on strategic needs, and with reference to daily operation of the store, changes in business districts and market performance. Dynamic adjustment, closing behavior is the decision made by NŌME to optimize operations. NŌME is still looking for stores with larger area, better flow of people and better return on investment.

At present, NŌME has only responded to the closure of the first store in Shanghai, and the problems of multiple store closures, franchisees returning stores, and suppliers being arrears have not been explained. A number of executives from the retail industry told us that the current difficulties faced by NŌME are closely related to its radical expansion and vague business positioning. This entrepreneurial star known for its Nordic design and high cost performance is being tested.

Wild eyes madness

In the first year of its establishment, NŌME通Through the combination of direct business and joining, nearly 100 stores were opened. Subsequently, NŌME continued to accelerate its expansion by opening a large number of franchise stores. April 2018,NŌME heldThe first strategic partner created a conference, saying that the number of franchise stores has reached 1400 A number of contracted deposits reached 300 million. Up to now, according to the data of NŌME official website, it has been established for more than three years, and it has opened more than 500 stores.

This expansion rate is far beyond MUJI, IKEA and NITORI equivalent brands. The number of MUJI stores that have entered the Chinese market for more than 14 years is about 250, which basically keeps the expansion rate of more than 20 new stores every year. In the same years, the Japanese home furnishing brand NITORI has no more than 50 stores, and even the NOME, which has the same model as NŌME, has only opened more than 50 stores in the trademark dispute.

A large number of stores have placed higher demands on optimizing the supply chain and improving the ability to operate stores. It is necessary to introduce a large amount of funds, and NŌME has a great demand for financing. In March 2019, NŌME announced that it had completed the joint venture of Sequoia Capital and Huaxing Capital at the end of 2018, Tiantu Capital, today’s capital and investment in the B round of financing, financing amounted to 600 million yuan. As of now, NŌME has completed more than 1 billion yuan in financing.

The massive expansion has brought new challenges to NŌME’s supply chain, and NŌME’s efforts to optimize supply chains are currently not ideal. “They should underestimate the complexity of the supply chain, has caused a lot of new problems in the store after the store opened. Rescuing goods and purchasing plans need to practice internal skills. “A senior executive from the offline home industry told.

A direct example is that NŌME’s apparel supplier revealed in an interview with the media that the founder Chen Hao has too large a single quantity, and the actual sales of the store is much lower than the order quantity, resulting in inventory backlog. , which in turn led to liquidity being blocked.

The offline retailing needs to consider the back-end supply chain system when it is expanding. These are not fast enough.

Chen Hao has accumulated a lot of experience in the clothing supply chain. Prior to NŌME, he established the men’s fast fashion brand KM. At present, the brand has more than 500 offline stores, and the annual GMV is more than 3 billion yuan. However, whether the clothing supply chain experience can be copied to the household grocery field requires a question mark.

Transformation dilemma

In addition to the rapid expansion, NŌME is constantly adjusting its commercial positioning. When the latest round of financing was asked about the new plan, Chen Hao said that 200 million of them would invest in product development and brand promotion, while another 400 million users develop new business.

On the one hand, it is planning to open 500 large user experience centers of 1,500 to 6,000 square meters independently, which means greater cost pressure. At the same time, a new business that can be launched faster is “NŌME Super Ten Yuan Store”, and Chen Hao will set the store opening schedule as September this year. This sudden transformation has somewhat subverted the business logic that Chen Hao claimed that “the ten-yuan store is backward productivity and will never get involved”.

Startups have not yet established themselves to change their business positioning, which is largely a helpless move. Although NŌME said that the turnover of a single store in a shopping mall reached 2 million yuan, this kind of data is mostly a direct-operated store with better revenue. The revenue of different stores is very different. Many franchisees responded to a number of media reports, and the performance of the big stores in the shopping malls was bleak, only to a fraction of the good performance stores.

The performance of some stores is not as good as expected. It is a way to find the increase in the sinking market. But this sudden move from a high-end shopping center to a sinking market is killing franchisees and suppliers is caught off guard. In order to stabilize the “military heart”, NŌME gave some franchisees the option of “price reduction to shop”, and some franchisees accepted this approach. However, due to the large price gap between commodity structure and product prices in different markets, some suppliers are facing a reshuffle crisis. NŌME also needs to find a matching supplier.

Opening multiple types of stores and arranging different types of markets is a big challenge for a startup that is still in its infancy. Old players IKEA, MUJI and NITORI are years of proven business models. Only then will we start a diversified store strategy.

The brand is expanding at a high speed driven by capital, but the NŌME design team is not yet capable of carrying this growth rate. An executive from the home industry revealed that although it is a designer brand, NŌME now has no designer products in batches.

NŌME began to take risks and “learn” the mature designs of other brands. On July 8th, the domestic original air fragrance brand DAYLY LAB issued a document saying that NŌME copied its 360 car fragrance. In order to safeguard rights, DAILY LAB posted an original patent certificate and stated that “NŌME has infringed DAILY LAB art copyright/design patent/utility technology patent”. There is currently no response to this NŌME aspect. However, it can be seen from the public pictures that the design and shape of the two car fragrances are almost identical, and it is difficult to distinguish them without looking at the logo.

As a start-up company, NŌME needs a beautiful story to quickly open the door to the capital market. It chose the “Nordic Design” that is very popular in the home furnishing industry in recent years. But at present, there is no shortage of loopholes in this story. The picture of the design and development center set up in Stockholm, Sweden, which NŌME released on the official website, was taken by many media and netizens. And many of NOME’s lawsuit disputes still in the lawsuit also indicate that it is in the gray area of ​​the cottage design.

These bold practices are reversing the brand and triggering a credibility crisis.

For startups, running fast is an important strategy to prove their development potential to the market, but if you run well, you can attract capital investment for a long time. The trouble that NŌME is experiencing may be that most startups have stepped on it. The pit.

The header image is from NŌME official website