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News Oct 10, 2018 08:01 pm EqualOcean

Fresh legend completed CNY 300 million B round of financing and will expand the foreign market

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Jan 2, 2020 11:08 am · Fresh Legend

CCFA 2019 China Chain Person of the Year | The Evolution of Wang Weihe's Fresh Legend

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Oct 7, 2019 11:55 pm ·

Fresh Legend Tests on Fresh Grocery Store Model

Fresh Legend (生鲜传奇), a community-based fresh grocery store, is testing on a 600 square meter new store model under its sister brand Letus(乐城超市). According to ‘retail observation’, behind this trial brewed the new strategic movement of the company. If the store test is successful, the company plans to replicate this model to its other chain stores. There’re mainly three types of fresh grocery stores under the concept of new retail in China: the online-offline grocery supermarket that has the area of over 4,000 square meters such as Freshhema under Alibaba, 7 Fresh under JD.com and Super Species under Yonghui; the online grocery store operating on a front-warehouse model like Miss Fresh and Dingdong; the community-based grocery store with a square footage of no more than 1,000 square meters such as Fresh Legend, Qiandama and Yinpin Fresh. The convenience and the experience of community-based fresh grocery store differentiate themselves with other giant players, what’s more important, they might be the minorities in this market who actually profit from the business. Though Freshhema is the most known pioneer in the field of new retail, the around 4,000 square meter area rent and the logistic labor made the Alibaba backed player in a current state of loss. And that is also the case for most of the fresh grocery stores. Despite the capital ebb and consumption decline, Fresh Legend, on the other hand, has been showing growth potential for initial public offering. It had just finished a new round of funding with hundreds of millions of yuan on July this year. What's more, the company will launch the 100 squre meter franchised mini store in 2020. With the 250 square meter small store type functioning as the main business model, plus the 600-800 square meter medium store testing for massive application, Fresh Legend will form  a business stucture on these three models. Based on the company's officail statemet, Fresh Legend can operate around 50 medium stores, over 500 small sized stores and almost 1,000 mini stores in Hefei province, the origin of the company with a population of 8.09 million.

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Jul 22, 2019 11:11 am ·

Fresh Legend Completes Series B with Hundreds of Millions Yuan

The game of fresh grocery market has entered a cool-down period since the beginning of this year. Top players like Freshhema and 7Fresh, who keep gaining support from Internet giant Alibaba and JD.com, slowed down in expanding. Here we have an exception. Fresh Legend (生鲜传奇), a community-based fresh grocery store, finished a new round of funding with hundreds of millions of yuan during this year's capital ebb and consumption decline. Harvest Investment lead in this Series B of fundraising. According to iYiou.com, the fund raised will be applied in the store expansion and the construction of its supply chain. The reason for selecting Harvest is due to its leading position in secondary market investment. Fresh Legend is aiming for an initial public offering in the future with assistant from this aspect. The fresh grocery market can be divided into three categories. First is the online-offline grocery supermarkets that have the area for more than 4000 square meters such as Freshhema under Alibaba, 7 Fresh under JD.com and Super Species under Yonghui. They usually contain an SKU for at least 3000, provide an in-store dining area and offers home delivery within a range of 3 kilometers. Second is the online-only grocery stores who exhibit fresh goods online and equipped a logistic team to deliver the order from the front warehouse located nearby. Miss Fresh, and Dingdong Maicai. This mode depends heavily on its app online traffic with less than 2000 SKU. The third one is the community-based grocery store with a square footage of no more than 500 square meters and less than 500 SKU, this is where Fresh Lengend's main battleground lies. The growth of the company is inseparable with the development of urbanization and the increasing population density of community in China. The convenience and the experience of community-based fresh grocery store differentiate itself with other giant players. Though Freshhema is the most known pioneer in the field of new retail, the around 4,000 square meter area rent and the logistic labor made the Alibaba backed player in a current state of loss. And that is also the case for most of the fresh grocery stores. The reason is the diseconomies of scale of this market. Though we cannot see their financials, the capital support proved that the community-based fresh grocery stores seem like a new force that gradually rises against the big trend. Beside Fresh Legend, Qiandama (钱大妈) and Yinpin Fresh (谊品生鲜) have both expanded to more than 1,000 outlets this year. Qiandama has been expanding to northern China since April, while Yinpin Fresh also completed Series B funding round of CNY 2 billion this March. 

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Mar 10, 2019 10:59 pm · EO company

Reveal the community fresh leader in depth -- Fresh Legend

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Dec 11, 2018 08:06 pm ·

The Red Ocean of Fresh Express Market, Legend Fresh’s To-Be or Not-To-Be Dilemma

In early October, Fresh Legend(生鲜传奇, Shengxianchuanqi) has secured its series B funding in amount of CNY 300 million (USD 43.48 million) led by IDG group and followed by Sequoia China and Black Ants Capital(黑蚁资本). As a fresh product retailer, Fresh Legend is the black horse in the market. Born in Anhui province, Fresh Legend founded by Letus supermarket(乐城超市) has opened 100 retail stores till now and expected to open 1300 more stores in future five years. Being ambitious and bold, Fresh Legend has accelerated its expansion pace with strong financial support from VCs. Fresh Legend is a chain fresh product express store brand that focuses on xiaoqu (small community). Xiaoqu is a Chinese concept of community and neighborhood, whose geographical range is smaller than a general community but bigger than a neighborhood. In siting selection, Fresh Legend shares a similar standard in siting with Trader Joe’s. According to a 2015’s analysis, Trader Joe’s siting tended to select zip code areas with more than 30,000 people and the average household income over USD 70,000 per annum. A xiaoqu’s size may vary from tens to hundreds of households, and Fresh Legend’s target is to cover every xiaoqu within 1 km (0.62 mile) radius that has more than 1,000 households. Considering Chinese population density, 3 - 4 km^2 may mean a customer base of 50,000 residents. Though, what Fresh Legend sells is different from Trader Joe’s. Fresh Legend resembles farmer’s market at some degree due to the products it sells - fresh vegetables, meat, seafood, fresh-made products and seasonings-and where its products come from – directly from origin. Fresh Legend offers Land-to-Table products, and hence its product pricing is in advantage comparing to local supermarkets. In 2017, the fresh express market sized reached CNY 13.91 million. Founded in 2015, Fresh Legend’s success in the fresh retail market has attracted competitors, and lots of them have strong backgrounds. Freshhema(盒马生鲜) comes from Alibaba Group, Ella Supermarket(Xiaoxiangshengxian, 小象生鲜) is delivered by Meituan Dianping and JD.com founded its fresh express department. All these competitors are standing on giants’ shoulders, while Fresh Legend has little resources comparing to them. Fresh retail is the strength of Fresh Legend. Even backed up by IoT management applied in inventory, order management, supply chain and so on, Fresh Legend is weaker than giant-supported fresh retailers in the logistics network. Alibaba, Meituan Dianping and JD.com are top e-commerce leaders in China and all have constructed their own logistics networks over years. In 2017, China’s express delivery’s quantity of packages was 40.06 billion and revenue reached CNY 495.7 billion. Behind a high speed in both revenue and quantity, giants push the hardest. Data from Ministry of Transport of China’s Republic of China Fresh express retail’s keyword is FRESH. A better logistics network could provide fresher products and control the potential risks that might be brought due to products’ expiration and possible PR crisis. Comparing with the expansion speed, Fresh Legend’s progress in setting the logistics network could be ignored. Logistics could restrain the variety of products and customer experience if door-to-door service is included in Fresh Legend’s blueprint. For now, without a strong logistics network, Fresh Legend’s performance could satiate its investors’ requirement. According to IDG’s previous research, Fresh Legend’s price was averagely 27% lower than local supermarkets, and even if the price were to be raised up 15%, Fresh Legend would still be in advantage. Besides price, quality is another reason that puts Fresh Legend in favorable status. Recently, Freshhema was exposed two food expiration scandals, which indirectly strengthened Fresh Legend’s position. Fresh Legend purchases directly from farmers or organizations who produce products and delivers to its retail stores. The simplified ordering process minimizes potential risks and is easy to control products’ quality. The fresh express market was supposed to be a blue ocean for all participants, but now aggressive extensions make the blue turn to red. According to Fresh Legend’s CEO, WANG Wei(王卫), Fresh Legend opens stores in new and low-occupancy xiaoqus in order to be in advance than other competitors, and build bondings from the very beginning with xiaoqu residents. He also mentioned that opening stores in low-occupancy xiaoqus equals to daily losses – may as low as CNY 8,000 cash flow per day while CNY 22,000 is the financial-sound line. Bearing losses is for the better good, believed by Wang Wei, first come first serve. However, this expansion model seems elastic to the real estate market. Real estate market is a battleground for investors, not for consumption but for investment. Occupancy might be the concern for Fresh Legend only. As mentioned above, siting is a strategy that both Trader Joe’s and Fresh Legend shared. Ironically, siting criteria are no longer criteria when the competition gets intense for Fresh Legend. Blind siting for market share and ignoring hidden risks, with even 10 times of series B funding amount, could not stop Fresh Legend fall into a strange loop with financial risks: whether market performance is beyond expectation or below, Fresh Legend will keep expanding and opening new stores. On the other side, if Fresh Legend were not the one who splurges money in expansion, there would be others to play the role. In fact, others are following the step of Fresh Legend. Opening stores blindly or not is not up to Fresh Legend -- this is the To-Be or Not-To-Be dilemma for Fresh Legend and other players in the market. --Author: FU YingWei; write to YingWei at YingWei@EqualOcean.com

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Dec 5, 2018 02:46 pm · Fresh Legend

Fresh Legend continues to accelerate store layout, welcomes 2 new stores today

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