On September 8, 2020, Nongfu Spring officially went public on the Hong Kong Stock Exchange, which gain a strong booster for the company's further development. The brilliant performance of Nongfu Spring is closely related to the company's diversified layout, Nongfu Spring has never stopped its efforts to this end, especially for the new-retailing layout.
Nongfu Spring took the lead in adopting vending machines in a large scale as early as 2015. In 2018, Nongfu Spring began to move its vending machines to the underground carparks of the communities. It has occupied underground carparks in numerous communities of Beijing, Tianjin, Wuhan and other cities in just half a year. In 2019, the new-retailing plan of Nongfu Spring began to gain momentum. Subsequently, Nongfu Spring upgraded the "Underground Carpark Vending Machine" to "Nongfu Spring Sesame Store".
On the surface, this is just a change in the name, but behind it is a completely different new-retailing layout. At the moment, Nongfu Spring Sesame Store mainly sells its own products, such as bottled and barreled drinking water and beverages. In addition, it also sells the popular Northeast Fragrant Rice and Navel Orange of Nongfu Spring. In terms of payment, Nongfu Spring Sesame Store also draws on the experience of traditional convenience stores to support the QR code bothway payment. Consumers only need to show their QR code, and the machine will automatically recognize the deduction. Due to the convenient design and low price, many consumers are willing to use Nongfu Spring Sesame Store.
According to relevant data, Nongfu Spring has set up tens of thousands of Sesame Stores across the country, and the number will continue to grow in 2020. It is worth noting that Nongfu Spring attaches more importance to the quality of stores compared with previous extensive layout. For instance, the housing price, occupancy rate, the car ownership and family income of the community are all within the scope of site selection.
In fact, the rise of Nongfu Spring Sesame Store is closely connected with people's needs. One important reason underlying the loss of traditional convenience stores apart from high rents is the low gross profit of the goods. The advantage of Nongfu Spring Sesame Store is that the rents of underground carparks in the communities are rather low, and all the goods it sells are Nongfu Spring’s own products. It still has profits even the price is lower. We can see that Nongfu Spring manages to create a closed-loop convenience store, or to say, a data-orienting store. The functions of the store are expanded, enabling it to be a " self-service point". Unlike traditional convenience stores, Nongfu Spring mainly focuses on family consumption, namely, builds a directly connect of “store-car-family” by creating a membership system. The sesame store mainly layout of the barreled drinking water and rice used in the household consumption as well as water and beverage packs suitable for car uses, effectively expands consumption scenarios and improves consumers' stickiness. With the continuous enrichment of membership system and data, the goods categories of Sesame Store will also increase, which not only promotes the diversification of product categories, but also promotes the exposure of products and improves the publicity effect of products.
Entering the store, leaving the store and getting home have become the three core scenes of Nongfu spring's customer services. It meets the needs of consumers with a variety of solutions, including 24-hour shelf, self-service and Intra-city delivery. The competitive advantage of Nongfu Spring Sesame Store are taking its own products as base and focusing on high-frequency household consumption categories. This is also the reason why Nongfu Spring is able to take a differentiated road and the key to a win-win situation.