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“New Species” in the FMCG industry

Yunji was listed on NASDAQ in the United States in May 2019, has more than 10 million members, and currently has a turnover of about 30 billion yuan. In October last year, Yunji released the “Super Brand Plan”, which aims to comprehensively upgrade the supply chain system and create 100 brands with annual sales of more than 100 million yuan.

Yunji established a joint venture with Zhongshang Group this time. In April, it will be the first French skincare brand developed and introduced on the Yunji platform. Next, we will gradually develop and introduce imported formulas for bathing and bathing, body care, oral care, killing, makeup, and health food.

“ China’s head FMCG comprehensive operation service provider ” Zhongshang Group was founded in 2006 and is headquartered in Guangzhou. It is a collection of product design, research and development, production, transportation, import agency, OEM , ODM, channel operation, retail management, IP authorization management as one integrated FMCG industry chain enterprise group. Its business categories cover cosmetics, skin care, personal care, home cleaning, daily necessities, food, etc., and has more than 10,000 SKUs. More than 120 retail platforms, such as products, provide comprehensive customized services from product development to comprehensive operations, and are the “behind the scenes” for many retail platforms.

Zhongshang Group delivers about 3 billion high-quality daily-use consumer goods to the society every year. It is an invisible champion in multiple sub-categories, and through its unique comprehensive customization capabilities, it cooperates with multiple retail platforms to surpass it. 300 million users provide rich products.

At the end of the supply chain, Zhongshang Group has three factories (beauty, cotton, and oral). It is currently the largest ODM supplier of makeup and cotton in Watsons. In addition, Zhongshang also has a wealth of global supply chain resources, including 30 track-level product technology champion strategic partners,There are 500 cooperative factories with independent research and development capabilities, and 100 international cooperative manufacturers with independent brands.

In the field of warehousing and logistics, Zhongshang Group has built its own warehousing and logistics center to provide “one-piece delivery” service for cooperative retailers, avoiding product backlogs, and delivering “freshest” products to users. .

In the retail operation, Zhongshang Group has a team of 1,000 people in the terminal, providing terminal sales and display management services to retailers, and providing product promotion and promotion services for multiple brands.

In terms of imported brand agency, Lu, Qianfulian, Mi Nong, Bomei, China Resources Atsugi, Beiyin and other brands that Chinese consumers are familiar with have all been introduced into the domestic market. Among them, Qian Fulian returned to Li Jiaqi’s live broadcast room many times. In Li Jiaqi’s live broadcast on the evening of March 3, Qian Fulian cleansing foam sold 40,000 in 5 minutes. In addition, Zhongshang Group also represents other well-known global brand products, such as Kao Japan, Nissin, New Zealand health food Comvita, American cosmetics wet, Germany Nivea and so on.

As the “hidden champion” in the FMCG industry, Zhongshang Group is considered a “new species” for consumption upgrades and an important reason why it can become the “product partner” of choice for many outstanding retail platforms.

For example, since the outbreak of the epidemic, the public has urgently mobilized the supply chain and provided sufficient masks, kill products and imported convenience food to Yunji as soon as possible. This supply chain response speed is not something that ordinary suppliers can do.

Chinese version of “comprehensive trading company”

The Zhongshang Group’s model is relatively rare in China, but it is the mainstream model in Japan.

People’s benchmarking company is the Arata Group, Japan’s second-largest consumer goods company. Arata was formed by the merger of three Japanese trading companies in 2002, with sales of approximately RMB 50 billion in fiscal year 2019. It has over 1,600 suppliers and more than 120,000 SKUs. It is the core supplier of all head drug stores in Japan. .

Same as Zhongshang Group, Arata Group’s upstream docking with large brands and manufacturers obtains goods (Kao, Shiseido, Kobayashi Pharmaceutical, etc.) and creates its own brand, and downstream docking with retailers (Matsumoto Kiyoshi, Aeon, the whole family, etc. ) Provide value-added services such as goods and data, and carry out distribution throughout Japan through its own logistics system.

In 2018, Zhongshang Group began to cooperate with Arata Group to introduce Japanese high-quality products, raw materials, technologies, formulas, etc. to China, and through the product development, manufacturing and comprehensive operations of Zhongshang Group, more high-quality products will be introduced. For consumers in China. Inaka Tanaka, the head of Arata’s overseas business department, commented, “Like Arata, Zhongshang Group not only has the function of commodity circulation, but also the function of product development and product manufacturing. This business model has broad prospects.”

At present, Zhongshang Group and AratThe a group has carried out exclusive cooperation in the field of skin care, skin care, oral care and pets, and obtained exclusive cooperations including Japanese amino acid deep repair and cleaning brand Cureamino and Japanese silk protein skin care leading brand Adan, etc. , Daily necessities and body care are also undergoing in-depth cooperation. Through Arata, Zhongshang Group has deeply linked the top daily-use fast-moving consumer goods companies in many sub-sectors in Japan, such as the rocket soap company focused on providing users with clean and healthy products, the Japanese household goods manufacturer sanko and the Japanese head placenta Stock development company fracora and others. The combination of the two “comprehensive trading companies” fully mobilized the resources of the China-Japan FMCG industry and provided more high-quality products and services to Chinese consumers.

Retrofit and upgrade China’s retail industry

For the joint venture between Zhongshang and Yunji, Liu Xiaomin, chairman of Zhongshang Group, believes that the two parties will break the traditional relationship between retailers and suppliers and become real entrepreneurs. Through the joint venture model, Zhongshang will transform from a traditional “supplier” to a true “product partner”, where both parties share risk and benefit, and jointly create greater value for consumers.

For Yunji, reaching strategic partner-level cooperation with companies such as Zhongshang with core product capabilities has greatly enhanced its competitiveness in high-quality product supply. In particular, platforms such as Taobao Xinxuan, Beijing Manufacturing, and Xiaomi Youpin all strengthen the construction of high-quality supply chains. It is the general trend to take this step, and it is also an active strategic upgrade.

In the future, the pace of investment and export carriages will slow down, and consumption growth will be the main driving force for China’s GDP growth in the future. At present, China’s urban population is close to 700 million, forming a huge consumer body, and the consumption upgrade is in full swing. With the emergence of a large number of personalized and customized demands from consumers, a number of new national consumer brands are being formed.

It can be imagined that with the increase in the proportion of consumption in China’s economy and the advent of a wave of consumption upgrades, “product expert” companies with strong supply chain capabilities, such as Zhongshang, and companies with membership and traffic advantages such as Yunji For retail platforms, the deep integration between the two will unlock huge potential to upgrade and even reshape the face of China’s retail industry.