FOCUSING ON THE “HUNDRED-THOUSAND-TEN-THOUSAND PROJECT” | AGREEMENT INVESTMENT OF APPROXIMATELY 543 MILLION YUAN! THREE PREPARED FOOD INDUSTRY PROJECTS SIGNED IN QINGCHENG

Home

FOCUSING ON THE “HUNDRED-THOUSAND-TEN-THOUSAND PROJECT” | AGREEMENT INVESTMENT OF APPROXIMATELY 543 MILLION YUAN! THREE PREPARED FOOD INDUSTRY PROJECTS SIGNED IN QINGCHENG

On the morning of September 28, the signing ceremony for the cooperative project of the Feilaixia Prepared Food Industrial Park in Qingyuan City was held in Qingcheng District. The Qingcheng District People’s Government signed strategic framework agreements with Qingyuan Zhengdao Agricultural Development Co., Ltd., Guangdong Hongfeng Catering Management Co., Ltd., and Guangdong Xueyin Group Co., Ltd., with an expected total investment of about 543 million yuan to build a prepared food processing production project. Deputy District Chief Lei Huankun of Qingcheng District attended the signing ceremony and delivered a speech.

Lei Huankun stated that the successful signing of this prepared food industry strategic project marks a new starting point for the transformation and upgrading of Qingcheng’s agricultural specialty industry. It demonstrates Qingcheng’s confidence and determination to seize the development opportunity in the prepared food industry, pursue cooperation, and achieve mutual benefits. This will also inject strong momentum into accelerating agricultural modernization and promoting high-quality development in Qingcheng. In the future, all parties to the agreement will continue to deepen practical cooperation, conduct comprehensive strategic docking, and promote the high-quality development of Qingcheng’s prepared food industry. Qingcheng will also adopt the most practical work style to provide the best platform and optimal services for enterprises, nurturing the prepared food industry as an important sector, fully supporting the implementation of the project, helping enterprises to grow and strengthen, and achieving mutual cooperation and win-win outcomes.

Focus

What products will this project produce?

The project will focus on local agricultural products in Qingcheng, developing semi-prepared and fully-prepared food products around Qingyuan’s five major billion-yuan agricultural industries. It aims to establish a high-standard prepared food park integrating a central kitchen, cold chain storage, cold chain distribution, quality inspection center, technological research and development, e-commerce, and information platform, building a comprehensive platform for the prepared food industry chain and supply chain to promote the upgrade of Qingcheng’s entire prepared food industry chain.

Why is this project located in Qingcheng?

Superior Location

Qingcheng District is located in the south-central part of Guangdong Province, at the core of Qingyuan City. It borders Guangzhou and Foshan and is the political, economic, and cultural center of Qingyuan City. Qingcheng has been successfully established as a national district with balanced development of compulsory education, a national advanced unit for quality family planning services, a national advanced district in scientific and technological progress assessment, a Guangdong Province all-region tourism demonstration area, and a top 100 district in green development. It was also awarded the “2020 China Smart City Demonstration City” and has been recognized as a “Guangdong Province Double-Support Model District” for ten consecutive years.

Convenient Transportation

Qingcheng District is the nearest central district of a prefecture-level city to the provincial capital in the Guangdong-Hong Kong-Macao Greater Bay Area. It has superior location, transportation, ecological, and development space advantages for receiving the radiation drive of the Greater Bay Area. The Beijing-Guangzhou High-speed Railway, Beijing-Guangzhou Railway, Foshan-Qingyuan Expressway, Guangzhou-Qingyuan Expressway, and Guangzhou-Qingyuan Intercity Railway run north-south through Qingcheng, forming an extensive water-land-air transportation network with the Beijiang waterway, creating a one-hour living circle with Guangzhou, Foshan, and the Pearl River Delta region, providing effective transportation guarantees for the development of the prepared food industry. The Feilaixia Town, where the industrial park is located, is in the eastern part of Qingcheng, in the mid-lower reaches of Beijiang River, with convenient transportation.

Approximately 2 kilometers from the new port public logistics terminal at Qingyuan Port
About 1 kilometer from the entrance of Shanzhan Expressway and 3 kilometers from the entrance of Leguang Expressway
16 minutes to Guangzhou North Station by Guangzhou-Qingyuan Intercity Railway, 29 minutes to Guangzhou South Station by high-speed rail
Only 60 kilometers from Guangzhou city center and Baiyun International Airport

Abundant Talent Resources

The Guangdong Vocational Education City is located in the East City Subdistrict of Qingcheng, housing more than 10 vocational higher education institutions, with 200,000-260,000 students. It is becoming the largest high-skilled talent training base in South China and one of the largest vocational education clusters in the country. Annually, 30,000-40,000 vocational students graduate, providing strong talent support for enterprises. Training programs such as “Yue Cuisine Chef,” “Southern Guangdong Housekeeping,” and “Guangdong Technician” provide professional skilled personnel for enterprises.

Strong Industrial Foundation

Good Manufacturing Base: Qingcheng District has industrial platforms such as Qingyuan High-tech Zone, Guangzhou-Qingyuan Industrial Park, and Guangzhou-Qingyuan Airport Modern Logistics Industrial New City, with well-developed upstream and downstream industrial chains, providing quality logistics support for settled enterprises.
Distinctive Industry Characteristics: In recent years, Qingyuan City has vigorously developed rural characteristic industries, creating five major billion-yuan industries such as Qingyuan chicken. Qingcheng District is the core area for Qingyuan chicken industry, a concentration area for high-quality fruit industry, a standardized production demonstration area for vegetable industry, a demonstration base for processing high-quality vegetables, and a model area for southern urban leisure agriculture. Qingcheng’s poultry industry has outstanding advantages, and the vegetable and fruit industries are distinctive. The district has successfully established a provincial-level modern agricultural industrial park and is building a national-level modern agricultural industrial park. In 2022, Qingcheng’s poultry slaughter reached 30 million birds, pig slaughter reached 197,200, aquaculture area reached 54,000 acres, and economic crop planting area reached 242,900 acres. The district’s livestock and poultry industry has significant advantages, with over 300 Qingyuan chicken farms (households), one national-level agricultural leading enterprise (Tiannong Group), six provincial-level, and 27 municipal-level enterprises, six slaughtering enterprises, six provincial “vegetable basket” bases, three Guangdong-Hong Kong-Macao Greater Bay Area “vegetable basket” production bases, nine breeding chicken farms, and the only national Qingyuan partridge original breeding farm (Tiannong Qingyuan partridge original breeding farm) in the city, providing high-quality and stable raw materials for food manufacturing enterprises.

Extension

Qingyuan Zhengdao Agricultural Development Co., Ltd.

Established in 2023 with a registered capital of 5 million yuan, Qingyuan Zhengdao Agricultural Development Co., Ltd. is a comprehensive enterprise focusing on agricultural entity economy and modern agricultural development services. The company’s main business includes food research and development, production, processing, and sales, cold chain storage logistics, agricultural tourism, catering services, agricultural product brand incubation, and industrial park operation.

The company operates with “new technology, new culture, new agriculture, new catering” as its business carriers, leveraging its advantages, integrating resources, and grasping various regional development resource elements. It is committed to promoting the development of original ecological, green, and healthy famous, high-quality, and special products in the region, integrating the entire industrial chain of agricultural product promotion, research and development, production, processing, sales, and services.

Guangdong Hongfeng Catering Management Co., Ltd.

Established in 2007 with a registered capital of 10 million yuan, Guangdong Hongfeng Catering Management Co., Ltd. is a key agricultural leading enterprise dedicated to the management and operation of the agricultural product supply chain. The company integrates catering management services, group meal canteen management, and agricultural product cultivation, processing, storage, and distribution. Through the operation model of “company + base + cooperative + market,” it professionally provides quality agricultural product ingredient distribution for factory, school, army, prison, government agencies, and supermarket, catering hotel canteens. The company also realizes agricultural product and grain oil food family distribution services through internet platforms, making it one of the largest comprehensive agricultural and sideline product full-industry chain operation enterprises in Qingyuan region.

Hongfeng Company has passed certifications in food safety, quality management, occupational health and safety management, and environmental management control systems. It has been recognized as a “Contract-abiding and Trustworthy Enterprise” in Guangdong Province for thirteen consecutive years and is a key agricultural leading enterprise in Qingcheng District, Qingyuan City. Hongfeng Company has established a full-industry chain system covering cultivation, processing, and distribution. The two supporting companies invested and controlled by Hongfeng are Guangdong Hongfeng Ecological Construction Agricultural Development Co., Ltd., focusing on vegetable cultivation and ecological agricultural projects, and Foshan Sanshui Hongfeng Cultivation Professional Cooperative, focusing on vegetable cultivation, aquaculture, and poultry farming projects.

Guangdong Xueyin Group Co., Ltd.

Founded in 1998, Guangdong Xueyin Group Co., Ltd. is a national high-tech enterprise, a national key leading enterprise in agricultural industrialization, and a private enterprise with state-owned capital participation. After more than 20 years of development, Xueyin Group has become a digital agricultural full-industry chain group company with high integration of the three industries.

Xueyin Group has an advantageous layout with a complete self-controlled industrial chain from farmland to the dining table. Its business covers agricultural product cultivation, agricultural product processing, agricultural product cold chain logistics, agricultural product processing technology research and development, prepared food production and processing, central kitchen nutrition group meals, agricultural informatization services, and supply chain finance. Currently, Xueyin Group has established agricultural product urban shared distribution centers in regions such as northern Guangdong, eastern Guangdong, western Guangdong, and the Greater Bay Area, and has built a cold chain distribution network for agricultural product ingredients covering the entire province.

The successful signing of these projects marks a new starting point for the transformation and upgrading of Qingcheng’s agricultural specialty industry. With the implementation of these projects, Qingcheng will be able to attract more high-quality projects, build a modern agricultural industry system, achieve rural revitalization, and promote economic growth.

With the rising popularity of the “Prepared Meals Entering Campuses” topic, school cafeterias have once again become a focal point of concern for many parents. How do school cafeterias procure their ingredients? How is food safety managed? What are the standards for purchasing fresh ingredients? With these questions in mind, the author interviewed Metro, a service provider that supplies food distribution and ingredients to several schools, to gain insights into the current state and trends of campus food from the perspective of a third-party service provider.

Fresh Ingredients Remain the Mainstream in Campus Food Procurement

School cafeterias are a special catering market because their consumers are mainly children. The state also imposes stringent controls on campus food safety. As early as February 20, 2019, the Ministry of Education, the State Administration for Market Regulation, and the National Health Commission jointly issued the “Regulations on School Food Safety and Nutritional Health Management,” which stipulate strict regulations on the management of school cafeterias and external food purchases. For example, “School cafeterias should establish a food safety traceability system, accurately and completely record and retain information on food procurement inspection, ensuring food traceability.”

“According to the campuses served by Metro, they strictly implement the ‘Regulations on School Food Safety and Nutritional Health Management,’ with very stringent requirements for ingredients. They require fresh, transparent, and traceable ingredients with complete, effective, and quickly accessible test reports, along with a sound certificate/ticket/archive management system to ensure food safety certification traceability,” stated the relevant person in charge of Metro’s public business. “Under such high standards, it is difficult for prepared meals to meet the requirements of campus cafeterias.”

Based on the campuses served by Metro, fresh ingredients remain the mainstream in campus food procurement. For instance, in the past three years, fresh pork and vegetables have accounted for over 30% of Metro’s supplies. The top ten fresh food items (fresh pork, vegetables, fruits, refrigerated dairy products, fresh beef and lamb, eggs, fresh poultry, rice, live aquatic products, and frozen poultry) collectively account for a whopping 70% of the supply.

In fact, food safety incidents in individual school cafeterias are not widespread, and parents need not be overly concerned. School cafeterias also have clear requirements for purchasing external food. For example, “School cafeterias should establish a procurement inspection record system for food, food additives, and food-related products, accurately recording the name, specification, quantity, production date or batch number, shelf life, procurement date, and the name, address, and contact information of the supplier, and retain the relevant vouchers containing the above information. The retention period for procurement inspection records and related vouchers should be no less than six months after the product’s shelf life expires; if there is no clear shelf life, the retention period should be no less than two years. The retention period for records and vouchers of edible agricultural products should be no less than six months.”

To meet the “stringent” procurement requirements and standards of campus cafeterias, Metro has been developing traceability systems for high-volume sales items such as fruits, vegetables, aquatic products, and meat for more than a decade. To date, they have developed over 4,500 traceable products.

“By scanning the barcode, you can know the growth process of this batch of apples, the specific orchard location, the area of the orchard, soil conditions, and even the grower’s information. You can also see the processing process of the apples, from planting, picking, selecting, packaging, to transportation, all traceable,” explained the relevant person in charge of Metro’s public business.

Moreover, during the interview, the temperature control in Metro’s fresh food area left a deep impression on the reporter. The entire area is kept at a very low temperature to ensure maximum freshness and safety of the ingredients. Different storage temperatures are strictly controlled and differentiated for different products: refrigerated products must be kept between 0~~7°C, frozen products must be between -21°C and -15°C, and fruits and vegetables must be between 0~~10°C. In fact, from suppliers to Metro’s distribution center, from the distribution center to Metro’s stores, and finally to customers, Metro has strict standards to ensure the safety and integrity of the entire cold chain.

School Cafeterias Are More Than Just “Filling Up”

The emphasis on fresh ingredient procurement in school cafeterias is due to nutritional health considerations. Students are in a critical period of physical development, and they eat more frequently at school than at home. School cafeterias play an important role in ensuring children’s nutritional intake.

On June 9, 2021, the Ministry of Education, the State Administration for Market Regulation, the National Health Commission, and the General Administration of Sport of China jointly issued the “Guidelines for the Construction of Nutrition and Health Schools,” which specifically states in Article 27 that each meal provided to students should include three or more of the four categories of food: grains, tubers, and legumes; vegetables and fruits; aquatic products, livestock and poultry, and eggs; dairy and soy products. The variety of food should reach at least 12 types per day and at least 25 types per week.

Nutritional health depends not only on the diversity and richness of the ingredients but also on their freshness. Nutritional research indicates that the freshness of ingredients significantly affects their nutritional value. Unfresh ingredients not only result in nutrient loss but can also harm the body. For example, fresh fruits are important sources of vitamins (vitamin C, carotene, B vitamins), minerals (potassium, calcium, magnesium), and dietary fiber. The nutritional value of unfresh fruits, such as cellulose, fructose, and minerals, is compromised. If they spoil, they not only lose nutritional value but can also cause gastrointestinal discomfort, such as diarrhea and abdominal pain, which is detrimental to health.

“From our service experience, kindergartens have higher requirements for fresh ingredients than general schools because young children have higher nutritional needs, and parents are more sensitive and concerned,” explained the relevant person in charge of Metro’s public business. It is reported that kindergarten clients account for nearly 70% of Metro’s services. When asked about Metro’s specific procurement standards, the relevant person in charge used the acceptance standards for fresh meat as an example: rear leg meat must be fresh, red, with no more than 30% fat; front leg meat must be fresh, red and shiny, with no odor, no blood spots, and no more than 30% fat; belly meat must have no more than two-finger-width of fat, no more than four-finger thickness, and no belly skin; triple meat must have three clear lines and no more than three-finger thickness; secondary meat must be fresh with no more than 20% fat; and tenderloin must be tender, non-watered, with no tail piece, and no attached fat.

Another set of data from Metro shows the high standards kindergartens have for fresh procurement: “Kindergarten clients account for 17% of Metro’s fresh pork purchases, with nearly four purchases per week. Additionally, vegetable purchases also account for 17%.” From Metro’s introduction, we can see why they have become a long-term stable food supplier for many schools and kindergartens: “Adhering to the ‘from farm to market’ quality assurance throughout, starting from planting and breeding farms, ensuring high standards at the source of the supply chain.”

“We have 200 to 300 audit requirements for suppliers; a supplier must undergo multiple evaluations to pass the audit that covers the entire process from planting, breeding, to harvesting,” the relevant person in charge of Metro’s public business explained.

The controversy over “prepared meals entering campuses” arises because they currently cannot fully meet the food safety and nutritional health needs of campus dining. This demand, in turn, drives food-related industry chain companies to provide specialized, refined, unique, and new services, giving rise to professional institutions like Metro. Schools and educational institutions that choose professional suppliers like Metro serve as exemplary models for those unable to ensure cafeteria nutrition and safety.

Evaluating the “Hot Trend”: Assessing the True Potential and Efficiency of the Prepared Food Industry

When assessing whether a “hot trend” truly has broad prospects and isn’t merely a speculative rush, criteria such as its ability to drive upstream and downstream industries and the efficiency of industrial iteration are crucial. Prepared foods became a hot trend due to the COVID-19 pandemic, but they were not created for special periods. Prepared foods have already infiltrated our daily meals, hold a place in restaurants, and are changing the current and future eating habits of Chinese people. They symbolize the high industrialization of the food industry. Through this series of reports, we will break down every link in the prepared food industry chain, analyzing the current production landscape and future directions of prepared foods in China.

Prepared Foods = Meal Kits = Preservatives?

When people talk about prepared foods, such judgments may arise.

Companies involved in prepared foods have not chosen to avoid these public concerns. Liu Dayong, Vice President of Zhongyang Group and General Manager of Zhongyang Yutianxia, is well aware of consumers’ worries about additives in prepared foods.

“In the past, the use of preservatives in prepared foods mainly came from B-end demand. Due to the high demand for quick meal preparation and low storage environment requirements in kitchens, products that could be stored and transported at room temperature were used,” Liu Dayong told Jiemian News. “Therefore, preservatives and stabilizers that maintain ‘color, aroma, and taste’ for a long time were needed in seasonings for catering.”

However, the current situation is different. As the prepared food industry has developed, it has undergone a reshuffle. Shelf-stable prepared foods that required large amounts of additives to restore food flavor and were sold at low prices are exiting the market. The industry is gradually shifting towards frozen prepared foods relying on cold chain logistics.

Reducing Preservatives: How to Maintain Freshness?

The 2022 in-depth report on the prepared food industry by Huaxin Securities also pointed out that compared to traditional meal kits, prepared foods have a shorter shelf life and higher requirements for freshness. Moreover, downstream customers are more scattered, and product demand is diverse. Therefore, preserving freshness and timely delivery are core requirements for prepared foods.

“Currently, we use cold chain throughout the entire process for our aquatic products. This allows us to eliminate the need for preservatives and antioxidants when developing matching seasoning packets. Instead, we use biologically extracted seasonings,” Liu Dayong said.

Consumers are familiar with frozen prepared foods such as crayfish, blackfish slices in pickled fish, and cooked chicken. These now use quick-freezing technology rather than traditional preservatives for preservation.

For example, in the quick-freezing process, a different technology from traditional food freezing is used.

Many prepared foods now use liquid nitrogen quick-freezing technology during the freezing process. Liquid nitrogen, as an ultra-low temperature refrigerant, quickly absorbs heat to achieve rapid freezing when it contacts food, reaching -18°C.

The application of liquid nitrogen quick-freezing technology brings not only efficiency but also quality. The technology quickly freezes water into tiny ice crystals, reducing moisture loss and preserving the texture and nutritional value of the product.

For instance, popular prepared food crayfish are quickly frozen in a liquid nitrogen chamber for about 10 minutes after cooking and seasoning, locking in the fresh flavor. In contrast, traditional freezing methods require 4 to 6 hours to freeze to -25°C to -30°C.

Similarly, the cooked chicken from Wens Group’s Jiawei brand only takes about 2 hours from slaughtering, blanching, marinating, and simmering to using liquid nitrogen quick-freezing technology before it can be shipped nationwide.

Scale and Specialization in Cold Chain Logistics: Essential for Freshness

When prepared foods are frozen and preserved using technology and leave the factory, the race against time begins.

China’s market is vast, and prepared foods need the support of a scaled cold chain logistics system to penetrate different regions. Fortunately, the rapid growth of the prepared food market presents more opportunities for the logistics industry, which is why companies like Gree and SF Express are entering the prepared food sector.

For example, in August last year, SF Express announced it would provide solutions for the prepared food industry, including trunk and branch line transportation, cold chain storage services, express delivery, and same-city distribution. At the end of 2022, Gree high-profile announced an investment of 50 million yuan to establish a prepared food equipment manufacturing company, providing cold chain equipment in the cold chain segment.

Gree Group told Jiemian News that the company has over 100 product specifications to address efficiency issues in logistics handling, storage, and packaging during production.

The cold chain logistics field in China has undergone a long journey before it could “easily” deliver prepared foods to your table.

From 1998 to 2007, the cold chain industry in China was in its infancy. Until 2018, upstream food companies and foreign cold chain transportation mainly explored B-end cold chain logistics. Since 2020, under the prepared food trend, China’s cold chain development has seen unprecedented growth, with annual growth rates exceeding 60% for several consecutive years.

For example, JD Logistics established a prepared food department at the beginning of 2022, focusing on serving two types of customers: central kitchens (ToB) and prepared foods (ToC), forming a scaled and specialized layout.

JD Logistics Public Business Division General Manager San Ming said they categorize prepared food customers into three types: upstream raw material companies, midstream prepared food enterprises (including prepared food processors and deep processing enterprises), and downstream industries (mainly catering customers and new retail enterprises).

To this end, they designed a model that provides integrated production and sales supply chain services for central kitchens, including the construction planning of prepared food industrial parks, packaging, and digital farms. For the C-end, they use a tiered city distribution method.

According to San Ming, over 95% of prepared foods require cold chain operation. For city distribution, JD Logistics also has corresponding plans, including solutions for 30-minute, 45-minute, and 60-minute deliveries, as well as overall delivery plans.

Currently, JD’s cold chain operates over 100 temperature-controlled cold chain warehouses for fresh food, covering more than 330 cities. Relying on these cold chain layouts, customers and consumers can receive their prepared foods more quickly, ensuring the freshness of the products.

Self-Building Cold Chains: Pros and Cons

Prepared food production companies use different approaches for cold chains: some build their own cold storage and cold chain logistics, some cooperate with third-party logistics companies, and others use both methods.

For instance, companies like Heshi Aquatic and Yongji Aquatic mainly use self-delivery, while CP Group has built a cold chain logistics in Zhanjiang. Hengxing Aquatic and Wens Group have chosen to cooperate with Gree Cold Chain. Many small and medium-sized prepared food companies in Zhucheng, Shandong rely on third-party cold chain logistics companies.

There are pros and cons to building your own cold chain.

Companies aiming for expansion often consider self-building due to scale considerations. The advantage of self-built cold chains is the ability to more effectively control the logistics process, reducing transaction risks by closely monitoring logistics service quality. It also allows for quicker access to consumer information and market trends.

However, the downside of self-built delivery modes is the high cost of establishing a cold chain logistics system, requiring substantial capital investment. Without sufficient financial resources and a large volume of orders to support it, it could hamper the company’s development.

Using third-party logistics delivery has a significant advantage in separating sales and logistics, allowing the company to focus more on sales while reducing logistics costs.

Moreover, for prepared foods, logistics companies like Zhongtong Cold Chain are increasing “less-than-truckload” (LTL) cold chain express services.

In simple terms, road express is divided into full truckload and less-than-truckload logistics. From the perspective of the number of freight orders, full truckload logistics refers to a single freight order filling an entire truck.

Less-than-truckload logistics requires multiple freight orders to fill a truck, combining goods from multiple clients going to the same destination.

From the perspective of cargo weight and handling requirements, full truckload transportation usually involves large quantities of goods, typically over 3 tons, with no high handling requirements and no need for specialized stops and sourcing in transit. Less-than-truckload logistics usually carries goods under 3 tons, requiring more complex and detailed handling.

In essence, less-than-truckload logistics, compared to full truckload logistics, is a concept that, when applied to cold chain transportation of prepared foods, allows for more diverse types of prepared foods to be transported together. It is a more flexible logistics method.

“Prepared foods need less-than-truckload logistics. Whether for B-end or C-end markets, the demand for diverse categories of prepared foods is increasing. Prepared food companies are also expanding and enriching their product categories, naturally shifting from full truckload transportation to more market-adapted less-than-truckload transportation,” a local cold chain industry expert in Zhucheng once told Jiemian News.

However, using third-party logistics also has its drawbacks. For instance, if the information technology systems are not in place, logistics companies and clients cannot share resources. This means prepared food companies cannot quickly grasp market trends.

How Far Are We from Lower Cold Chain Costs for Prepared Foods?

Furthermore, upgrading cold chain logistics inevitably increases costs, leading consumers to ponder whether the convenience and flavor of prepared foods are worth the premium.

Several interviewed prepared food companies mentioned that the high retail price of prepared foods on the C-end is mainly due to cold chain transportation costs.

Qin Yuming, Secretary-General of the Food Supply Chain Branch of the China Federation of Logistics and Purchasing, told Jiemian News that the situation in the C-end market is particularly prominent, with average logistics costs reaching up to 20% of the selling price, significantly increasing the overall price.

For instance, the production cost of a box of pickled fish on the market may be only a dozen yuan, but cold chain logistics costs are also about a dozen yuan, making the final retail price of the box of pickled fish 30-40 yuan in supermarkets. Consumers perceive low cost-effectiveness mainly because over half of the cost comes from cold chain logistics. Overall, cold chain logistics costs are 40%-60% higher than regular logistics.

For the prepared food market in China to continue expanding, it needs a broader cold chain transportation system. “The development of cold chain logistics determines the sales radius of the prepared food industry. Without a developed cold chain network or complete infrastructure, prepared food products cannot be sold outside,” Qin Yuming said.

If you pay close attention, you’ll notice that recent policies on cold chain and prepared foods are also tilting in favor.

According to incomplete statistics, 52 cold chain logistics-related policies were issued at the national level in 2022. Guangdong was the first in the country to establish five local standards for prepared foods, including the “Prepared Food Cold Chain Distribution Specification” and “Prepared Food Industrial Park Construction Guidelines.”

With policy support and the entry of specialized and scaled participants, the future trillion-yuan prepared food industry could mature and truly explode. Consequently, cold chain costs are expected to decrease, bringing the goal of “delicious and affordable” prepared foods closer.

The number of Guoquan Shihui stores has grown nearly sixfold in less than four years.

During the National Day holiday, on October 4, Guoquan Shihui (Shanghai) Co., Ltd. updated its prospectus, continuing its process of listing on the main board of the Hong Kong Stock Exchange.

According to the updated prospectus, Guoquan Shihui has only six directly-operated stores, with the rest being franchise stores. The number of franchise stores increased from 1,441 at the beginning of 2020 to 9,216 by the end of 2022, and as of September 26, 2023, the number of Guoquan Shihui stores further increased to 9,978.

Store expansion over the past three years has directly driven its performance growth.

For the years 2020, 2021, 2022, and the four months ending April 30, 2023, Guoquan Shihui’s revenue was 2.965 billion yuan, 3.958 billion yuan, 7.174 billion yuan, and 2.078 billion yuan, respectively. The company also achieved profitability in 2022, with a net profit of 240 million yuan, and net profit for the first four months of 2023 reaching 120 million yuan.

Guoquan Shihui is often referred to as a low-cost version of “Hema Hotpot” and “Shuhai.” It was established in Zhengzhou in 2015, positioned as a one-stop “new retail chain supermarket for hotpot and barbecue ingredients,” primarily selling hotpot and barbecue ingredients, including frozen products, fresh food, snacks, base ingredients, dipping sauces, seasonal drinks, and hotpot and barbecue utensils.

From an expansion model perspective, Guoquan Shihui adopts a franchise model, signing franchise agreements with franchisees, selling self-branded products to them, and providing store operation management strategies without charging franchise fees. Guoquan Shihui’s income mainly comes from product sales to franchisees.

According to Frost & Sullivan data, based on retail sales of home dining products in 2022, Guoquan ranked first among all retailers in China, with a market share of 3.0%. Additionally, based on 2022 retail sales, Guoquan is the largest home hotpot and barbecue brand in China.

The business model of hotpot supermarkets is tailored for home scenarios. Besides the “hotpot” category, Guoquan Shihui is also expanding into other areas, such as barbecue, which shares similar social attributes and dining scenes.

The updated prospectus shows that Guoquan Shihui is building a second growth curve around the barbecue scene.

The prospectus indicates that as of April 30, 2023, Guoquan Shihui’s revenue from hotpot products, barbecue products, and others was 1.518 billion yuan, 249 million yuan, and 263 million yuan, respectively, accounting for 74.8%, 12.3%, and 12.9% of total revenue.

Compared to the past few years, the revenue proportion from hotpot products is decreasing, while the share of barbecue products and other ingredients is increasing. From 2020 to 2022, the revenue proportion from hotpot products was 81.9%, 79.7%, and 75.8%, respectively.

Besides meeting the demand for “eating hotpot/barbecue at home,” Guoquan Shihui also benefits from its layout in lower-tier markets.

According to the latest prospectus, as of September 26, 2023, the number of Guoquan Shihui stores increased to 9,978. The distribution includes 703 stores in municipalities, 2,117 stores in provincial capitals, 2,820 stores in prefecture-level cities, 2,667 stores in county-level cities, and 1,671 stores in towns—these three categories account for 70% of all Guoquan Shihui stores.

In lower-tier markets, farmers’ markets naturally dominate short-shelf-life products and supermarkets primarily handle frozen foods. However, Guoquan Shihui penetrates these markets more flexibly by opening community stores through franchisees, filling the gap left by supermarket frozen food near communities.

To further scale its network in lower-tier markets, Guoquan Shihui needs to streamline its supply chain.

According to the updated prospectus, besides collaborating with 266 ingredient suppliers such as Anjoy and Sanquan, as of April 30, 2023, Guoquan Shihui also owns three ingredient production plants: “Heyi Factory” for beef products, “Wanlaiwanqu Factory” for meatballs, and “Chengming Factory” for hotpot base ingredients. It has also invested in “Daixiaji” for shrimp paste production.

Additionally, Guoquan Shihui has built 17 central warehouses and over 1,000 frozen forward warehouses nationwide, coupled with Huading Cold Chain, to facilitate next-day delivery to township-level stores. According to the prospectus, one of the main uses of IPO proceeds will be to enhance supply chain capabilities by increasing upstream production capacity and efficiency.

With a maturing franchise model, supply chain foundation, and product matrix supporting its scale of nearly 10,000 stores, Guoquan Shihui’s future focus may shift to product research and innovation, seeking more growth opportunities in the existing market and adding more certainty to its post-listing performance development.

Recently, in the factory of Shandong Dezhou Braised Chicken Co., Ltd. (hereinafter referred to as “Shandong Dezhou Braised Chicken”), SF Express courier Zhang Dianchao from the University Road Business Department has been so busy that he can barely lift his head. “During the Mid-Autumn Festival, the daily shipment volume of Shandong Dezhou Braised Chicken has been rising, nearly tripling in one day,” Zhang Dianchao said happily while busy packing Dezhou Braised Chicken gift boxes for delivery. “In addition to braised chicken, our outlet has also received and sent many mooncakes, tea, and other gifts recently.”

Every year during the “Double Festival” period, the volume of courier packages sees a significant increase, and this year is no exception. According to the Dezhou Postal Administration Bureau, since September, the postal and courier industry in Dezhou has entered its peak season. “Monitoring data shows that the delivery volume of Dezhou Braised Chicken has been rapidly increasing in recent years. As the ‘Double Festival’ approaches, the delivery volume of various postal and courier companies has reached new highs,” said Liu Wenyong, a member of the party group and deputy director of the Dezhou Postal Administration Bureau. In recent years, the Dezhou Bureau has deeply explored local specialty agricultural product resources, promoting the integration of courier companies with e-commerce and specialty agricultural product processing enterprises, helping local specialties transition from “able to go out” to “able to go out well,” thereby aiding local economic development.

Preparing for the Delivery Peak

Dezhou Braised Chicken is a classic dish in Shandong cuisine, and its preparation technique is a national intangible cultural heritage. In Dezhou, there are several braised chicken brand enterprises, including Shandong Dezhou Braised Chicken, Xiangsheng, Yongshengzhai, Shaxiaoer, and Liji. Shandong Dezhou Braised Chicken is a well-known traditional Chinese brand and the first braised chicken production company to move its livestreaming room into the production workshop.

On the afternoon of September 19, in the logistics workshop of Shandong Dezhou Braised Chicken, staff were busy packing various braised chicken products and attaching courier labels to the outer packaging.

“Currently, we have official flagship stores on e-commerce platforms such as Taobao, Douyin, and Pinduoduo. Our sales peak during e-commerce promotions like ’618,’ ‘Double 11,’ and traditional holidays such as Spring Festival, Dragon Boat Festival, and Mid-Autumn Festival. Every year, we send out 700,000 to 750,000 packages of braised chicken through major courier companies like China Post, SF Express, STO Express, YTO Express, and ZTO Express,” said Zhang Shanshan, manager of the e-commerce department at Shandong Dezhou Braised Chicken. During peak seasons, the company processes and produces 100,000 chickens daily, sending out 5,000 packages per day via courier.

Reflecting on the development of their e-commerce journey, Zhang Shanshan mentioned that the requirements for express delivery services on major e-commerce platforms have been increasing in recent years. “Previously, as long as the delivery was received, it was fine. Now, every step from placing the order to receiving it is time-sensitive,” she explained. “Initially, with small online sales volumes, couriers would package the products themselves and send them from their outlets. Now, with increasing online business, our partner courier companies have gradually improved their services. Since we started on-site courier collection, couriers visit our factory once a day, and during peak seasons, they are stationed here around the clock, with delivery trucks directly connected to the production line for continuous shipping. Currently, STO Express and YTO Express handle the majority of our shipments.”

Liu Wenyong stated that Dezhou Braised Chicken is a gold-standard project for modern agricultural courier services. To ensure service quality, the Dezhou Bureau promotes various service models and products from courier companies like SF Express, JD Logistics, and the “Tongda System” to meet different product delivery needs. Additionally, the Dezhou Bureau actively encourages courier companies to deeply explore local industry resources and innovate in integrated development. “Recently, SF Express and Shandong Dezhou Braised Chicken jointly held an online direct sales competition, which has accelerated the promotion of excellent products from Dezhou,” he added.

Increasing Parcel Collection Points

On the afternoon of September 20, in Dezhou Braised Chicken Food City, piles of Dezhou Braised Chicken gift boxes formed small mountains, and four SF Express couriers were busy packing, loading, and transporting the parcels back to their outlets. This temporary collection point was set up by SF Express in Dezhou specifically for the peak delivery season during the “Double Festival,” with four couriers collecting parcels throughout the day.

“During holidays, customers who buy braised chicken from our store often want to send it to other places. This year, these SF Express couriers came to provide door-to-door service. Customers buy and leave the packages at the door, and the couriers take care of the packing and shipping, saving us a lot of trouble,” said a staff member at Dezhou Braised Chicken Food City.

Dezhou has many direct-operated or specialty stores selling braised chicken and local specialties. In the three weeks leading up to the Mid-Autumn Festival, SF Express in Dezhou upgraded its services to meet shipping and delivery demands by setting up fixed collection points and mobile operations personnel at braised chicken direct-operated or specialty stores, providing on-site packing and collection services to facilitate store deliveries. Zhang Caiwang, business manager for the Lingcheng area of SF Express, said, “This year, we established 32 collection points in the area. In regions with a high concentration of direct-operated or specialty stores, braised chicken accounts for at least 30% of the parcels in the local outlet. Compared to the off-season, the delivery volume has increased nearly tenfold.” He also mentioned that the couriers use special packaging materials, including boxes, bubble wrap, and ice packs, to prevent damage and spoilage of the products.

Holiday gift deliveries require high efficiency, raising the demands for instant delivery and end-to-end fulfillment capabilities. Tan Yingying, head of SF Express Jinan District in Shandong, said that SF Express, leveraging its efficient flexible network and transportation capacity, uses a “forward warehouse + instant home delivery” service model to ensure the “last mile” in cities, achieving “half-day delivery” and even “hourly delivery” to get holiday gifts like braised chicken to consumers as quickly as possible.

“In addition to the ‘Double Festival,’ we are also well-prepared for major promotions like ‘Double 11′ and ‘Double 12,’ and we look forward to doing a great job,” Zhang Caiwang added.

From September 18 to 22, the fourth plenary meeting and related working group meetings of ISO/TC 315 Cold Chain Logistics were held online and offline in Paris. Huang Zhenghong, Executive Director of Yuhu Cold Chain and ISO/TC 315 working group expert, and Luo Bizhuang, Director of Yuhu Cold Chain, Vice Chairman of the Cold Chain Committee of China Federation of Logistics and Purchasing (CFLP), and ISO/TC 315 Chinese delegation expert, participated in the meetings in person and online, respectively. More than 60 experts from 10 countries including China, Singapore, Germany, France, South Korea, and Japan attended the meeting, with 29 experts from China participating.

On September 18, ISO/TC 315 organized the third CAG meeting. As the head of the WG6 working group, Huang Zhenghong attended the meeting along with the ISO/TC 315 chairman, secretary manager, and leaders of various working groups. The secretary manager and working group leaders reported to the chairman on the progress of standard formulation and future work plans.

On September 20, the ISO/TC 315 WG6 working group held its first meeting. As the project leader, Huang Zhenghong organized experts from various countries to discuss the 34 comments received during the voting phase of ISO/AWI TS 31514 “Requirements and Guidelines for Traceability in Cold Chain Logistics of Food” and reached consensus on modifications. The advancement of this standard received attention and support from experts worldwide, with the Singapore Standards Council applying to appoint a special person to join the WG6 working group as a joint leader to co-promote the writing of the standard with China. Liu Fei, Executive Deputy Secretary-General of the CFLP Cold Chain Committee, delivered speeches at the beginning and end of the meeting as the convener.

On September 21, the ISO/TC 315 WG2 working group held its seventh meeting. As a core member and main drafting unit of the WG2 working group, Yuhu Cold Chain deeply participated in the drafting of the international standard ISO/CD 31511 “Requirements for Contactless Delivery Services in Cold Chain Logistics.” This standard has successfully entered the DIS (Draft International Standard) stage, marking a milestone for Yuhu Cold Chain’s deep participation in international standards, representing international recognition of Yuhu’s intelligence. The Chinese delegation actively explained the actual situation of the Chinese industry at the meeting and engaged in friendly exchanges with other countries.

On September 22, the fourth plenary meeting of TC315 was held, attended by Yuhu Cold Chain. The conveners of WG2, WG3, WG4, WG5, and WG6 reported on the progress of their respective working groups. The annual meeting reached 11 resolutions.

The annual meeting was led by Qin Yuming, Secretary-General of the CFLP Cold Chain Logistics Professional Committee, and attended by Xiao Shuhuai, Director of the International Department of CFLP, Jin Lei, Deputy Director of the Standards Work Department of CFLP, Liu Fei, Executive Deputy Secretary-General of the CFLP Cold Chain Logistics Professional Committee, Wang Xiaoxiao, Assistant Secretary-General, Han Rui, Deputy Director of the Standards and Evaluation Center, and Zhao Yining, Deputy Director of the International Department.

This is the second year that Yuhu Cold Chain has participated in various major meetings of ISO/TC 315. Yuhu Cold Chain not only actively participates in the formulation of international standards but is also committed to promoting the transformation of local standards and actively participating in the creation of standards for the Guangdong-Hong Kong-Macao Greater Bay Area (referred to as “Greater Bay Area Standards”).

While the Paris meeting was being held, relevant departments of the Guangdong Provincial Government frequently visited Yuhu Cold Chain to investigate standardization work and had in-depth discussions with Jiang Wensheng, Vice Chairman of Hong Kong Yuhu Group and Director of Yuhu Cold Chain, and the team responsible for standardization promotion.

The relevant departments fully affirmed Yuhu Cold Chain’s deep participation in the formulation of international standards from the construction stage, considering it a demonstration of the strength and vision of Guangdong enterprises and Greater Bay Area enterprises in standardization. They hope that Yuhu Cold Chain will play a greater role in the work of local standards and Greater Bay Area standards, leveraging its industrial advantages domestically and internationally to contribute more to the promotion of local standards and Greater Bay Area standards.

Jiang Wensheng expressed that in the future, communication and collaboration with relevant government departments should be strengthened. Under the guidance of the government, Yuhu Cold Chain’s standardization work should be organically integrated into the overall framework of local standards and Greater Bay Area standards, actively voicing support for Guangdong and the Greater Bay Area.

Yuhu Group is a multinational industrial investment group headquartered in Hong Kong with over 20 years of history. It was founded by Mr. Huang Xiangmo, an entrepreneur of Guangdong origin and a well-known patriotic leader. Mr. Huang Xiangmo currently serves as an executive director of the China Peaceful Reunification Promotion Association, an executive director of the Chinese Overseas Friendship Association, a member of the Hong Kong Election Committee, and a member of the Hong Kong National People’s Congress election conference.

Yuhu Cold Chain is a cold chain food supply chain enterprise under Yuhu Group, providing one-stop domestic and international procurement, warehousing, logistics, and distribution solutions, full-chain innovative financial support, and high-quality living and office services through its international high-standard smart cold chain park industrial cluster. It has been honored with the “2022 Social Value Enterprise” award.

Currently, Yuhu Cold Chain’s projects in Guangzhou, Chengdu, Meishan, Wuhan, and Jieyang are all under construction, each listed as a provincial key project in Guangdong, Sichuan, and Hubei provinces. These projects constitute the largest cold chain project group under construction in China. Additionally, the Guangzhou project is a collaboration development project between Guangdong Province and multinational enterprises during the “14th Five-Year Plan” period; the Chengdu project is an important part of the “National Backbone Cold Chain Logistics Base” in Chengdu; the Meishan project is included in the pilot projects of large regional commodity distribution centers in Sichuan Province; and the Wuhan project is listed in the major construction projects of the “14th Five-Year Plan” for comprehensive transportation development and the “14th Five-Year Plan” for the development of the modern logistics industry in Wuhan.

On October 2, in the pleasant season of golden autumn, the Agricultural Products Cold Chain Storage Center project, with a total investment of 40 million yuan, officially broke ground in Tongling National Agricultural Science and Technology Park.

The Agricultural Products Cold Chain Logistics Center project is located on the east side of the intersection of Jiaojia Village and Gaoling Branch Road, covering an area of 7,753.99 square meters, with a total building area of 16,448.72 square meters. The construction includes the main structure, decoration works, equipment and installation works, supporting outdoor roads, and rain and sewage pipelines. The project officially started construction on October 2 and is expected to be completed and delivered by December 2024.

The Agricultural Products Cold Chain Logistics Center project is a significant supporting project for the innovation base of the Food Industry Park. It holds great importance for the construction of the innovation base of the Food Industry Park. Upon completion, it will further enhance the park’s infrastructure, improve the business environment, and provide significant resource support and guarantees for attracting enterprises and investment, as well as strengthening and extending the industrial chain.

Currently, the Great Silk Road Cold Chain Logistics Digital Industrial Park project, located within the Sanyi Agricultural Products Logistics Park, is progressing in an orderly manner. One of the main construction projects, a 40,000-square-meter cold storage facility, is undergoing the installation and inspection of fire protection facilities. “Once the project is fully completed, Anqing residents will enjoy a greater variety of high-quality and affordable fruits, vegetables, meat, and seafood from surrounding countries and regions across China,” said Fang Longzhong, General Manager of Great Silk Road Logistics (Anhui) Co., Ltd.

On the morning of September 29, passing north through the vegetable wholesale market in Sanyi Agricultural Products Logistics Park, several new buildings come into view, with trucks bustling and merchants busy. “This is the newly completed 10,000-square-meter trading center of the Great Silk Road Cold Chain Logistics Digital Industrial Park project, which is now in use, with fruit and vegetable vendors gradually moving in. Below ground is a 40,000-square-meter cold storage facility, currently the largest in Anqing, using the most advanced domestic storage and preservation technology and capable of storing 5,000 tons of goods. The second phase of the project will include the construction of a 100,000-square-meter cold storage facility, capable of storing 15,000 tons of goods,” said Fang Longzhong.

The “Sanyi Vegetable Wholesale Market” is a well-known “vegetable basket” for the people of Anqing, with an annual vegetable transaction volume of 200,000 tons, supplying more than 90% of the daily needs of Anqing residents. However, as times change, the disadvantages of traditional agricultural and sideline product wholesale markets have become increasingly apparent, making transformation and upgrading an urgent necessity.

To reduce logistics costs, diversify product types, and upgrade market quality, Great Silk Road Logistics (Anhui) Co., Ltd. is leading the implementation of the Cold Chain Logistics Digital Industrial Park Multimodal Transport Demonstration Project. The project aims to comprehensively transform the Sanyi Agricultural Products Logistics Park, focusing on the Great Silk Road Cold Chain Logistics Digital Industrial Park as the core and utilizing “road-to-rail” multimodal transport. This will establish a major logistics transit hub for agricultural and sideline products for Anhui, Jiangxi, Hubei provinces, and the Yangtze River Economic Belt.

Once the cold storage and other hardware facilities are completed, the project will focus on developing four “rail + road” multimodal transport routes to provide Anqing residents with more high-quality and affordable vegetables, fruits, seafood, and beef and lamb products. These routes include the “Imported Fruits” route from Southeast Asia (Laos) – (China-Laos Railway) – (Chengdu Railway) – Anqing North Station – (short-distance road) – Cold Chain Logistics Digital Industrial Park.

The “Cold Chain Logistics” route runs from Tianjin Port – (railway) – Anqing North Station – (short-distance road) – Cold Chain Logistics Digital Industrial Park, mainly transporting frozen goods, seafood products, fresh produce, and vegetables. The “Guangdong Direct” route runs from Guangzhou – (railway) – Anqing North Station – (short-distance road) – Cold Chain Logistics Digital Industrial Park, mainly transporting frozen goods and seafood products. The “Inner Mongolia Agricultural and Livestock Products” route runs from Inner Mongolia – (railway) – Anqing North Station – (short-distance road) – Cold Chain Logistics Digital Industrial Park, mainly transporting meat and dairy products.

At the same time, the project will comprehensively develop a “warehouse-distribution integrated system + multimodal transport system” to accelerate the establishment of a smooth, efficient, safe, green, smart, convenient, and well-supported modern cold chain logistics system. This will create a network for agricultural product wholesale markets and destination agricultural product cold chain logistics. The “warehouse-distribution integrated system” will provide process node control and coordination for goods warehousing, warehouse supervision, outbound dispatch, outbound loading, transport supervision, warehouse settlement, and transport settlement, promoting improved transportation efficiency and reduced costs. The “multimodal transport system” will offer comprehensive information services for multimodal transport logistics service providers, making agricultural product circulation more efficient and benefiting both farmers and citizens.

As we all know, technology is the primary productive force. In various fields, technological prowess is a crucial weapon for the long-term development of any enterprise. As people’s consumption concepts continue to upgrade, the fresh food industry, which is closely related to daily life, must keep pace with the times by deeply integrating technology with fresh food to unleash greater development vitality and better meet people’s daily needs.

In the process of technological development in the fresh food industry, several community fresh food brands have provided templates for the industry with their foresight, vision, and advanced operational models. One such brand is Qian Da Ma, which has been deeply involved in the fresh food sector for over a decade.

Since its establishment in 2012, Qian Da Ma has been committed to enhancing its technological strength and integrating technology into fresh food operations, truly using technology to safeguard the “fresh essence of life.” Besides ensuring daily freshness and selling out products through the “daily clearance” model and “timed discounts,” Qian Da Ma also uses data and technology to achieve regional control, effectively addressing the need to upgrade its operational model as it scales up.

Additionally, regarding the future direction of its digital system construction, Qian Da Ma has expressed its focus on refined management and price digitalization. In refined management, Qian Da Ma will collect information on stores, inventory, competitor product prices, and marketing strategies. This data will be analyzed by the data center to provide professional analyses and final recommendation plans, helping stores promptly adjust prices and marketing strategies, thereby further enhancing operational efficiency. In price digitalization, Qian Da Ma will gather big data on the planting scale and market conditions of major fresh produce areas across the country to conduct professional data analysis and trend forecasting. This will digitalize procurement price management and achieve transparency in supply chain information, thus effectively improving procurement efficiency and making Qian Da Ma’s fresh products fresher, safer, and more competitively priced.

It is evident that Qian Da Ma has always maintained a proactive attitude towards technological innovation and continuous exploration and innovation. Upholding the mission of “making every meal fresh,” Qian Da Ma’s future development is bound to be positive and significant in terms of technological advancement.

In October 2023, news emerged that Meituan Maicai would open a new hub in Hangzhou, marking a significant move since Zhang Jing’s promotion to Vice President of Meituan.

Amidst the prevailing industry trend of “surviving,” Meituan Maicai remains one of the few companies in the fresh food front warehouse track maintaining nationwide expansion.

It is reported that this year, Meituan Maicai has already entered two new cities, Suzhou and the soon-to-be-opened Hangzhou, both located in East China.

To date, Meituan Maicai has established operations in eight cities, including Beijing, Langfang, Shanghai, Suzhou, Shenzhen, Guangzhou, Foshan, and Wuhan. This indicates that Meituan Maicai’s layout covers various regions including East China, South China, North China, and Central China.

Notably, the replication speed of Meituan Maicai is not particularly fast and is relatively slow compared to internet companies. Over several years of development, Meituan Maicai has expanded to fewer than ten cities, with Foshan and Guangzhou effectively considered one city.

Thus, some observers believe that Meituan Maicai’s expansion into the Hangzhou market is not surprising.

However, they also point out that Meituan Maicai is unlikely to rapidly expand nationwide in the short term, unless the industry undergoes significant changes, such as the downfall of other major competitors like Dingdong Maicai and Pupu Supermarket, which would accelerate Meituan Maicai’s expansion.

Additionally, Meituan Maicai’s approach to opening the new Hangzhou hub is similar to its strategy in the Suzhou market, both led by the Shenzhen team rather than the Shanghai team (the Shenzhen market is currently one of the best-performing among the eight cities).

Despite this, it remains challenging for Meituan Maicai to displace Dingdong Maicai in East China. Dingdong Maicai is particularly strong in East China, especially in Shanghai and Suzhou, and has established certain local barriers in fresh food operations. On the product level, particularly with its own brand products, Dingdong Maicai has shown relatively good performance in East China.

Market observers note, “It doesn’t seem easy to push out Dingdong Maicai at the moment. Although there are rumors from the Guangzhou and Shenzhen markets that Dingdong Maicai is considering withdrawing, the team remains very strong in East China, especially with a gross margin of 35%.”

Unwilling to be passively attacked, Dingdong Maicai has also recently intensified its efforts in the Beijing market. Beijing is not only the headquarters of Meituan Maicai but also of JD.com.

Dingdong Maicai already has over 100 front warehouses in Beijing and has appointed Yan Xianfu, who performed well in the Jiangsu market, as the head of the Beijing market.

Meituan Maicai’s new openings in Hangzhou and Suzhou demonstrate its accelerating strategy to “encroach” on Dingdong Maicai.

At the same time, another giant, JD.com, has also entered the front warehouse track, testing the waters in the Beijing market. Market observers say, “As of the end of September, JD.com’s warehouse opening speed in Beijing was slower than expected, far behind Meituan Maicai, possibly encountering some issues. So far, JD.com has opened fewer than 20 front warehouses in the Beijing market.”

In today’s market, whether in fresh food or other industries, development generally requires a combination of online and offline integration, leveraging the advantages of both to upgrade business operations and expand the industry.

In summary, Meituan Maicai is accelerating its national layout by opening a new hub in Hangzhou. However, defeating Dingdong Maicai in East China is challenging due to the latter’s strong performance and local advantages. Additionally, JD.com’s foray into the Beijing market with front warehouses intensifies the competition. As the industry evolves and competition intensifies, the fresh food e-commerce market will continue to develop and transform.

FOCUSING ON THE “HUNDRED-THOUSAND-TEN-THOUSAND PROJECT” | AGREEMENT INVESTMENT OF APPROXIMATELY 543 MILLION YUAN! THREE PREPARED FOOD INDUSTRY PROJECTS SIGNED IN QINGCHENG