Shopping trend takes retail sector by storm

Although fewer and fewer actual customers visit Sun Zhang's convenience stores, he is still going gangbusters with his business, and plans to open his tenth store on Wednesday in Harbin, Heilongjiang province.

Partnering with a childhood friend, 35-year-old Sun and his business partner opened their first flash-express warehouse in March last year, naming it Feixiang Convenience Store.

Flash-express warehouses represent an emerging business model, are usually located in a warehouse and essentially sell all their goods online via deliveries.

"The store has no specific location requirements, which may help us save a lot of expenses such as rent and wages. Relying on online platforms such as Meituan for sales and delivery, we can achieve an average delivery time of about half an hour per order, with deliveries covering a radius of about five kilometers. Moreover, unlike most traditional retail stores that close at night, our stores are open 24 hours a day," Sun said.

After only three months of the first store opening, Sun's business venture began to make a profit.

Then they opened another eight stores in succession, including seven in Harbin and one in Shenyang, Liaoning province, by the end of 2023.

"Big data from online platforms can help us determine the category of goods and the timing of stocking," said Sun. "The variety of goods in the stores has now expanded to more than 6,000, from sewing kits and hardware accessories, to quilts, electric appliances, breakfast foods and beer. We are trying our best to provide customers with whatever they need. For instance, we finished an order for a printer at 10 pm one day when all shopping malls and large supermarkets had been closed. We will seize market opportunities and provide our customers with good shopping experiences," he added.

Sun said an online convenience store with an area of around 200 square meters has a daily average turnover of over 10,000 yuan ($1,389), which is about 10 times that which a 70-square-meter convenience store gets.

The surge of tourism in Harbin during the past winter season also brought Sun more sales volume, especially for stores near scenic spots and popular business districts.

"We received more orders from tourists, such as hot packs, portable power banks and data cables. And the sales volume of bath towels, swimsuits and suitcases was also quite high. During the period, we introduced new items such as refrigerator magnets and local souvenirs, which were favored by tourists. The order volume during the winter tourism season doubled," he said.

What surprised Sun was that he had expected a significant decrease in orders after the tourist season, but the reality was different.

"Currently, the order volume keeps steadily increasing with an average volume of 12,000 orders per store every month and 15,000 orders per month during peak periods. I think the new model has been accepted by more customers after the busy tourist season."

In fact, more people have seen market opportunities and support from the government. In May 2023, the local government released the "Implementation Plan for the Construction of Harbin's 15-Minute Convenient Living Circle", which encourages the establishment of new types of operating and distribution points represented by front warehouses, and the provision of convenient, rapid logistics and distribution services tailored to different customer needs.

Sun said: "We have plans to open 22 more Feixiang stores in Harbin this year, which will also create employment and entrepreneurial opportunities for more people.

"We also plan to open a central warehouse in Harbin where most of the goods will be stored, thus reducing stocking pressure on individual convenience stores."