Tencent Puts Huge Investment in YH Super Species, Strategic Challenge to Alibaba’s Hema

6 min read 

Alibaba is aggressively deploying its new retail business. Fresh Hema has established the entry barrier in terms of business model. JD.com and Meituan are both making small steps forward. This collaboration between Tencent and Yonghui will be a new variable for the industry.

With the successive entry of Internet tycoons, the war in supermarket and retail industry is sparkling.

Reporter received the information from an exclusive source that Tencent (00700.HK) has put heavy investment purchasing shares of Super Species, the fresh grocery store under Yonghui Superstores (601933.SH). The deal has now been closed and is supposed to be announced in the next two weeks. This is an important strategic investment Tencent has made in retailing, though the actual share and estimated value remain unknown. Yonghui Superstores has a current market value of 84.6 billion. Its collaboration with Tencent this time may disturb the competitive landscape of new retail and supermarket industry.

From someone close to this deal the reporter got the information that Tencent has been participating massively in new retail projects since second half of this year. And the rapid growth of Hema Store has especially stimulated the acceleration of Tencent’s progress. The above mentioned source states that this time’s purchase of shares by Tencent has two implications, the first being an offline fresh food store deployment to challenge the Fresh Hema, and the second being Tencent’s effort in building samples to reform its underlying technology, in order to test Tencent’s retailing solutions.

Fresh food is an industry of trillions dollar scale, and fresh food offline market has huge potential for transformation. This is a market both Internet tycoons and capital giants are looking at avidly. Among them Alibaba has been the most aggressive one. In 2017 Alibaba has invested hugely in the three main areas of operation in retailing – opening of 20 physical Fresh Hema Stores, retailing department enabling 600 thousand offline stores, and invested in regional retailers like Sanjiang Shopping, Lianhua Supermarket and New Hua Du. In November 2017, Alibaba became second largest shareholder with 36.16% share of Sun Art Retail Group, the largest retailer in China.

Jack Ma & Fresh Hema Store

Many business insiders reckon that Hema Store has already established this entry barrier with its experimental supermarket transformation mode. A top management in supermarket and retailing told Caijing reporter that the alchemy of this business mode is its system in integrating online and offline. Most of them are Hema patents and are hard for competitors to copy. After Alibaba becoming a shareholder of Sun Art Retail Group, Daniel Zhang has publicly stated that Alibaba’s strategy is to test this new retail mode in local supermarkets, and then apply it to larger supermarket groups, which means Hema business mode will be introduced quickly to the 454 supermarkets under Sun Art Retail Group.

Thus if Tencent still has no operations in retailing, the supermarket payment terminals, data input as well as volume flow will be influenced by the ever growing new retail business of Alibaba.

Tencent has always been in search for suitable object to invest within and outside of the investment system. Caijing reporter had the information that Tencent had heavily supported Meituan in its deployment in offline supermarkets; however, other than retail, Meituan has another business focus in 2018 which is online car-hailing. Currently Meituan is making slow progress in fresh food market with its Zhangyu Store, which has seen so far only one physical store in Beijing. According to a business insider close to Zhangyu, the store has not been part of part catering industry, with its low share of fresh food. This store is still testing the physical store business mode. And JD.com, in deep collaboration with Tencent, is planning the yet-launched JD.com fresh food store 7Fresh.

YH Super Species, with its established framework and expanding mode seems to be Tencent’s best choice in the current stage.

Super Species is launched on 1st of January this year by Yonghui’s subsidiary “Yonghui Yunchuang”. According to the announcement previously published by Yonghui, Yonghui Yunchuang has a registered equity of 1 billion, with Yonghui Superstores holding 52% of the shares, and Capital Today holding 12%. Yonghui Superstores employs a hybrid operation mode of “high-end supermarket + fresh food restaurant + O2O”, which is similar to Hema Store. Super Species has entered 6 cities so far with 17 physical stores. By end of this year another 6 store are expected.

On the one hand, Hema Store has higher online sales than offline, while Super Species has heavier offline operations, and is more of a combination of offline business with “restaurant + fresh food + supermarket”. Thus the investment from Tencent may accelerate its online development and optimize its digital capabilities. On the other hand, Super Species will be Tencent’s testing solution in offline retail. WeChat as the biggest social networking system, is capable of connecting all members, payment and information flow in all online and offline retailing scenarios. This means WeChat will be a full-package solution and data centre in all stages of the consumer journey, and Super Species is the foothold for this solution. This is an advantage Alipay, with no social media and social networking users base, does not have. However, the final result of this transformation is yet to be seen.

Retailing is a battle of long term. From Paipai, Yixun, JD.com, to Koudai,Tencent has proved with past experience that it has never withdrawn from the race in retailing, whether by participating itself or by investing in other players. The core reason being that, Tencent is the centre for data flow, and is always looking for channels to convert it to sales. Advertising, video games and ecommerce are currently channels for this conversion. And in the long term, retailing could be the channel. Meanwhile, the social centric data can be combined with external data in retailing.

A retailing industry investor pointed out that, Tencent’s investment in YH Super Species may accelerate the latter’s expansion and technology transformation, which will constitute a challenge to the Fresh Hema Store in certain regions and on certain scales. However, Hema has already gone through the testing phase, and has completed the reconstruction of human, goods, and platforms driven by big data. At the same time, the industry is still having doubts about whether Super Species is a supermarket with Internet mindset, and about Tencent’s operation capabilities in retailing. The reform of underlying technology as infrastructure may not have an instant effect.

On this transaction, Yonghui Superstores responded that please refer to the official listing statement. And Tencent has made no remarks so far.

This article originally appeared in Caijing and was translated by Pandaily.
Spread the love
60 comments Add yours
  1. When you aaгe ⲟccupied with а brand new profession as
    a paralegal, therre are a vaariety of options wjich youll consider.
    You migһt resolvе that being a freelance paralegal iѕ thhe way in which that you simply ѡish to pursue this field.
    Yoou may strt by weighing the pros and cons of this exciting new method of working in the paralsgal discipline; andd you mght determine that
    it is the best choice for yoս.

  2. My coder is trying to convince me to move to .net from PHP.
    I have always disliked the idwa because of the costs. But he’s tryiong none the less.
    I’ve been using Movable-type on a number of websittes for about a
    year and am nervous about switching to another platform.
    I have heard good things about blogengine.net.
    Is there a way I can transfer all my wordpress content into it?
    Any kind oof help would be greatly appreciated!

  3. This blog is great! I am happy that I’ve observed it. All articles
    are exciting and well composed. This is a wonderful demonstration of nice penning for those who can’t compose nicely.
    A lot of people have such trouble. There is however ways to resolve this problem.
    If you follow this link http://www.same-story.com/voir-son-profil/edwardboyd you will discover a web
    page with comprehensive reviews of web based paper composing organizations.
    You can choose the one which is right for you and order a essay you need.

  4. I seriously love your site.. Great colors & theme. Did you develop this amazing site yourself?

    Please reply back as I’m trying too create my own personal website and
    want to learn where you got thiss from or exactly what tthe theme is
    called. Thanks!

  5. Very nice post. I just stumbled upon your weblog and wanted to say that I’ve truly enjoyed browsing your blog
    posts. In any case I will be subscribing to your rss feed and I hokpe you wrtite again soon!

  6. Awesome! How did you get this great penning proficiency?
    Is it a talent or final result of time and effort? I would like to start up
    my own weblog too but I have very little time. Due to my work I can’t even write
    all the paperwork and projects for college. Because of it I made a
    decision to order an essay from academic penning websites.
    In order to prevent scam, I’ve located nice evaluation website, which
    you can visit by visiting this link bit.ly. As a result of it, I was capable to found a trustworthy writing company.

  7. Hey! Great article! I appreciate the way you
    explained %BT%. I would like to launch my own blog too but I
    have little time. Due to my occupation I can’t even compose all
    the papers and projects for university. For this reason I made a
    decision to use authoring websites. To come
    across reliable companies I use this internet site best resume writing services
    reviews where you can find a huge number of in-depth critiques on a variety
    of custom writing organizations.

  8. People in school commonly mention about Tencent Puts Huge Investment in YH Super Species,
    Strategic Challenge to Alibaba’s Hema, even so i am not sure I simply absolutely understand what actually.
    I wanted a tutor, or a good idea to express some counselor that may furnish me personally to advice.

    Do you?

  9. This is a pleasant penned article! I like it a lot. As for me, I don’t much
    favor composing and it doesn’t bring virtually
    any happiness or various other good emotions to me. But I have to do this or I’ll fail my studying.
    Because of it I made the decision to buy anarticle from online penning web
    pages. In order to avoid scam, I’ve located very good evaluation website, that you can head over to by clicking this link Francisco.
    Thanks to it, I was capable to identified a
    trustworthy authoring website.

  10. During your quality as soon as possible the professor referred to Tencent
    Puts Huge Investment in YH Super Species, Strategic Challenge to Alibaba’s Hema for some schedules.

    Experienced been scared to ask about the reasoning inside of class….
    Nonetheless I possess no clue of your company’s perform!

    Families, the goals? Do you know me when i say?

  11. This website is great! I am happy that I’ve observed it.
    All content is interesting and well penned. You definitely have a skills!
    I would like to be as good at composing as you, but it’s not my
    cup of tea. Thinking of this, I couldn’t just imagine how can I contend with the problem without this web site
    Kris. In-depth overviews of the most popular paper writing firms can guide
    each and every user to decide on the proper organization.

  12. Many thanks this well-arranged blog post about
    %BT%! This is exactly I was on the lookout for. Possessing superior authoring talents
    is great but not everybody can be an excellent writer.
    So what exactly to do in the situation when you really need
    to write a lot but you are bad at it? But, anyway, it’s not a problem once you learn about
    this internet site http://bit.ly/2EWpWKh. It
    is a review website which main objective is to assess
    writing companies and analyze the quality of their products.

  13. My mom could have been asking yours truly to assist and her containing Tencent Puts Huge Investment in YH
    Super Species, Strategic Challenge to Alibaba’s Hema.
    I`ve continued exclaiming I just don’t have enough time which will
    accomplish all through monday. But the simple truth – We have all little idea what exactly it is!
    May easily an employee move the message over it, please don’t hesitate to?

  14. Excellent! It is currently probably one of my favorite blog sites!
    It is a great pleasure to read blogposts from such an excellent article writer.
    I always needed to have such great authoring skillsets but I
    am bad at it. And I desire to present the website link to the internet site bit.ly which
    helps me a lot with my penning troubles. I am hoping it will be helpful for
    people that have same issue as mine.

  15. At last I’ve found great piece of writing about
    %BT%! Days of lookup are over now. Thank you very much, author!
    You’ve done a superb job! I really planned to have such good writing skillsets but I am
    bad at it. If there are folks who suffer from identical concern, I can propose this guys bit.ly.
    They write really good reviews on the most famous custom penning services.

  16. Great blog site and good write-up! It is very clear that the article author is knowledgeable and has a large knowledge in creating.
    A little time ago I was considering about
    starting my personal blog site but I don’t have time even to create essays
    for college because of my part-time job. This is why, I decided to purchase essay from custom
    writing organisations. And to make sure that
    I won’t spend my cash on scam, I visit this website best college paper writing service reviews
    where I can read truthful and competent critiques of various penning organizations.

  17. I bet the writer has large practical knowledge in writing and high writing talents.

    Too bad I’m not that proficient at composing, particularly
    in educational composing. That’s exactly why I usually order articles from different penning firms.
    But there is a method to deal with this issue. If you visit this site Jami you will find a internet site with detailed evaluations of online paper authoring companies.
    You can select the one which is ideal for you and purchase a essay you require.

  18. Many thanks for this well-arranged blog post about %BT%!
    This is exactly I was trying to find. As for me, I don’t much enjoy writing and
    it doesn’t provide any pleasure or various other beneficial feelings to
    me. But I must do this or I’ll fail my education. In such instances I normally
    visit this web page college essay editing service reviews where I can find good quality reviews and opt for the reputable composing
    company.

  19. I don’t nicely Tencent Puts Huge Investment in YH Super Species,
    Strategic Challenge to Alibaba’s Hema is! Why is it within all of the ears at this moment?
    Wish to folks think about most time frame while we’re talking about it?
    Are you currently able please help me for additional information??

  20. Finally I’ve observed good post about %BT%! Days of hunt are over now.

    Thank you very much, author! You’ve done a good job!
    Is it possible you give some bits of advice with regards to the way
    to cultivate writing talents? I am terrible
    as a blogger and it’s especially challenging because teachers in our university on a regular basis
    give us authoring tasks. To avoid this trouble you can buy a paper from one of the penning organizations which can be found in the internet.
    But many of them are unreliable. That’s why I always read these folks online editing services reviews.
    Their assessments of penning services helped me a
    lot!

  21. І ⅼike tһe helpful info уⲟu provide іn уoսr articles.
    І’ll bookmark ʏour weblog and check agaіn һere frequently.
    Ι aam quite sure I wiⅼl learn mаny neww stuff riɡht here!

    Ꮐood luck for the next!

  22. Thanks a lot! It was quite interesting to read, just as
    usual. Stay the best! I’m interested in read some fresh content from you.
    Is it possible you provide some bits of advice related to how
    to develop composing talents? I am awful as a blogger and it’s specially problematic since professors
    in our university continually give us writing tasks. It’s good that there are can be found sites like this
    one dissertation services review which makes reviews on various paper writing
    organizations.

  23. When I initially commented I clicked the “Notify me when new comments are added” checkbox and now each time a comment is added I get several emails with the same comment.
    Is there any way you can remove me from that service?
    Many thanks!

  24. I bet the writer has great practical knowledge in composing and high penning skills.
    A little time ago I was thinking about running my personal blog page but I
    have no time even to compose essays for university by reason of my part-time work.
    And I wish to distribute the website link to the web page http://kiwibox.com which helps me a lot
    with my penning complications. I really hope it will be useful for those with same difficulty as
    mine.

  25. The very next time I read a blog, Hopefully it doesn’t fail me just as much as this particular one.

    I mean, I know it was my choice to read, but I truly believed you’d have something interesting to say.
    All I hear is a bunch of whining about something you can fix if you were not too busy seeking attention. https://www.promotiongifts.ca

  26. Valuable information. Fortunate me I discovered your website unintentionally,
    and I’m stunned why this twist of fate did not took place earlier!
    I bookmarked it.

  27. Fantastic website and great article! It is apparent that the article author is knowledgeable
    and has a large experience in posting. I’m going to start my own blog too but
    I have almost no time. Due to my job I can’t even prepare
    all the articles and projects for university.
    And I want to reveal the link to the web page Todd which supports me a lot with my authoring difficulties.
    I hope it will be helpful for people with same problem as mine.

  28. Hey there wouⅼd yoս mind sharing whіch blog platform you’re working ԝith?
    Ι’m gοing to start my own blog іn the near future but І’m
    haѵing ɑ tough timе choosing Ьetween BlogEngine/Wordpress/Β2evolution and
    Drupal. Thе reason I asк iss Ƅecause ʏⲟur design ɑnd style ѕeems different then most blogs аnd I’m looҝing foг something c᧐mpletely unique.
    Ⲣ.S Apologies fߋr being оff-topic butt І had to ask!

  29. Good website and great piece of writing! It is clear that the
    creator is qualified and has a big working experience in posting.
    Is it possible you give some bits of advice with regards to the
    best way to raise penning proficiency? I am bad as a freelance writer and it’s specifically problematic since
    teachers in our university frequently give us writing tasks.
    To keep away from this trouble you can find a article
    from one of the writing firms which can be found in the internet.
    But a lot of them are untrustworthy. That’s why I always read these
    folks Milo. Their ratings of writing companies aided me a lot!

  30. Valuable info. Lucky me I found your website accidentally, and I’m stunned why this
    twist of fate didn’t came about in advance! I bookmarked
    it.

Leave a Reply

Your email address will not be published. Required fields are marked *