Shanghai market to achieve comprehensive profit, Ding Dong food strategy adjustment initial effect of “earning power” to improve

2022-06-22 0 By

Our newspaper ( reporter Lu Xiao Beijing reported that the Internet to sell vegetables this business, when can profit?Ding Dong has been expanding to buy food is trying to give the answer.On the evening of February 15, Ding Dong Mai CAI released its earnings report for the fourth quarter ending at the end of 2021 before serving.Earnings showed ding Dong Mai Vegetables revenue of 5.484 billion yuan in the period increased by 72% year-on-year.The net loss for the period was about $1.096 billion, 12 percent narrower than the same period last year.In a conference call after the earnings release, Liang Changlin, founder and CEO of Ding Dong Mai, also said that Ding Dong Mai had achieved full profitability in its home base of Shanghai in December 2021, “and strive to achieve full profitability in the Yangtze River Delta region by the end of the second quarter of this year, and strive to achieve close to profitability in the fourth quarter of this year.”Gross profit to improve the loss has always been the Internet companies need to face the topic, front warehouse selling vegetables is no exception.Ding Dong Mai CAI posted a net loss of about 6.43 billion yuan in the same period of 2021, double the year-on-year growth, according to the earnings report.However, a good signal is that in the fourth quarter of last year, The loss of Ding Dong vegetables narrowed, and the gross profit also improved year on year: the gross profit of Ding Dong vegetables in the current period was 27.7%, up from 15.1% in the same period last year.Behind this, compared with the revenue growth of 72%, in the fourth quarter of last year, Ding Dong Mai CAI’s total operating costs and expenses of about 6.5 billion yuan increased by about 48% year-on-year.Among them, marketing expenses of 358 million yuan increased by 38.3% year on year.The money was mainly used for marketing campaigns to acquire new users, according to earnings reports.In addition, its performance costs of 1.79 billion yuan, up 47% year on year.’The fourth quarter of last year was the best quarter since the establishment of Ding Dong Mai CAI,’ Mr. Liang said on a subsequent call.He noted that ding Dong Mai CAI’s overall non-GAAP net loss was less than 13 per cent in December.By contrast, the loss rate of Ding Dong Mai CAI, which is IPO in Q2 2021, is 37.2%.Liang Changlin also mentioned the day before the ding Dong buy food layoffs rumors.He said that under the influence of public opinion, Shanghai labor supervision department went to the company to conduct a field investigation, which proved that the company’s employee turnover has not changed much from previous years.February 16, Ding Dong buy food to “China Times” reporters said, “this investigation is mainly aimed at the local Shanghai.Including front-line employees.But the same is true for people who live in other places.”According to The Reporter of China Times, Ding Dong Mai CAI was founded in 2017, listed in the US stock market on June 29, 2021, and its stock price peaked at 46 DOLLARS the next day.By the end of the third quarter of 2021, There were 1,375 pre-positions in Ding Dong Mai CAI, nearly triple the number a year earlier, or 239 on a quarterly basis, according to financial reports.This is followed by a rise in performance costs.Financial results show that in the third quarter of last year, the performance costs of Ding Dong vegetables increased 1.2 times year-on-year to 2.308 billion yuan, which accounted for nearly 30% of the company’s total operating costs and expenses in the same period.Previously, the industry also believes that when communicating with reporters, compared with community group purchase, pre-position mode is more difficult to take into account efficiency and cost.But in its third-quarter results last year, Ding Dong Mai said it had changed its strategy from “scale first” to “efficiency first.”As an example, Ding Dong Mai CAI had about 1,400 front warehouses by the end of 2021.That means that in the fourth quarter of last year, it added only 25 or so front-positions in a single quarter.Prefabricated tuyere Liang Changlin said in a conference call that in fact, the pre-warehouse mode is relatively high efficiency.He cites Shanghai as an example where front-loading costs account for about 15 per cent of THE GMV.This figure is lower than most companies in the whole fresh market.In addition, he said, the traditional fresh e-commerce terminal loss is about 10 percent, while Ding Dong mai only about 2 percent.On the other hand, he said, Ding Dong buy vegetables gross margin improvement is also related to more private brands, reducing subsidies and overall user structure adjustment measures.Ding Dong chief strategy officer Yu Le also said in a telephone conference on the same day, the current market hot prepared dishes, the biggest threshold is mainly sales channels, but also the most important core competitiveness of Ding Dong to buy food.According to The Reporter of China Times, Ding Dong Maicai will launch its own brands in 2020, and currently has its own brands such as Ding Dong Ace dish and Ding Dong Da Manguan.In the fourth quarter of last year, prepared GMV in Ding Dong Mai CAI amounted to more than 900 million yuan, Yu said.This figure accounts for about 15% of the GMV in ding Dong.By comparison, Ding Dong mai CAI’s own brands accounted for 5.8% of its overall GMV in the third quarter of last year.Liang had previously said he expected the proportion to rise to about 30% in the future.On February 16, Ding Dong Maicai told China Times that the number of skUs of Ding Dong Maicai prepared dishes in China is currently 1,000-1,200, and will be adjusted according to different time points.”400-500 SKUs on a single city scale is the norm.Over the course of a year, the models were pretty much settled.”In addition, Ding Dong mai food also told reporters that in the future, prepared dishes will be built at the level of business division to gather the company’s important resources, the formation of upstream and downstream integration operation.In addition To the online self-management channels, there are plans To develop other online channels and offline channels, or To B channels.As of Feb. 15, the stock closed at $7.30, down 1.75%.Its current total market value is about $1.723 billion.Editor: Huang Xingli Editor: Han Feng