China Fresh Supermarket T11 Receives Tens of Millions in Series A Funding
...amid a serious race in the 'fresh+retail' segment.
Fresh supermarket new retail brand T11 has (in Chinese) recently completed an A round of funding worth tens of millions of dollars, led exclusively by global money manager MSA Capital. Du Yong, founder and CEO of T11, said that this round of financing will mainly be used for store network layout, strengthening the supply chain and logistics development and increasing strategic investment in retail technology.
According to Du Yong, T11 currently involves three major businesses: one is a distributed e-commerce network, providing consumers with high-quality global good products, mainly through T11 fresh supermarket stores and applets / APP channels; second, a supply chain system is deployed to strengthen T11's competitive advantage in the first-line fresh market; third, the exploration of retail technology empowerment, continuous optimization of business data and models to make retail more efficient and intelligent.
According to an iimedia research report (in Chinese), from 2013 to 2019 the scale of China's fresh food market continued to expand. In 2019, the market reached CNY 2.04 trillion (USD 290 billion), an increase of 6.8%. Coupled with the rapid development of fresh food e-commerce, community fresh food stores and other formats, netizens tend to have a high frequency of fresh food consumption.
The best-known player in this race is Hema Fresh, invested in by Alibaba (BABA:NYSE), which set its business model as the 'App online + store offline,' targeting medium to high-end consumers with a variety of imported merchandise. T11 has a similar model and covered customers, while it's more like a traditional boutique supermarket and runs as a self operation partner, but Hema Fresh is a joint operation partner. As the 'Fresh+retail' race is entering more competitors, and their target customers overlap a lot, the competition is becoming increasingly intense.
It is understood that, since the first store's pilot operation in 2019, T11 has accumulated more than 135,000 active users in a single store, mainly concentrated in a 3 km radius of the store, providing nearly 7000 global preferred fresh SKUs. Fresh food sales accounted for more than 65% of the total.
Besides fresh food, T11 is (in Chinese) expanding its business layout into other lifestyle areas. The beauty life museum, which focuses on young women, will also open a trial camp in the near future. Moreover, T11 has now established close cooperation with many high-quality commercial real estate players, and will try a multi-format and regional layout in 2020.
However, Du Yong emphasized that the overall expansion of T11 focuses on the main line of the supermarket, and the company has plans to add 5 to 7 standard stores in Beijing this year.