Summary of Key Points
The Beijing Supermarket Supply Enterprises Association has issued an initiative addressing the "chaotic competition" within the fresh food delivery industry, calling for an end to price-cutting strategies, protection of suppliers' rights, and prevention of monopolies. The industry is facing issues such as loss-making sales (selling products at a price lower than the cost of purchase), extended payment terms that can last up to six months (damaging suppliers' cash flow), and poor hygiene conditions. These problems not only threaten traditional physical supermarkets but also pose potential food safety risks. The association aims to restore fairness in the industry and maintain a healthy supply chain as well as market order.
Detailed Analysis
1. Why do delivery platforms sell products at a loss? – Capital-driven "suicidal" competition
A delivery platform is essentially a small warehouse near residential areas that delivers orders within an hour via riders, offering greater convenience than traditional supermarkets. However, the industry has become so competitive that capital has flocked in. To attract customers, platforms are willing to subsidize prices, selling products at a loss (e.g., for 0.99 yuan when the cost of purchase is 1 yuan).
This strategy is similar to opening a new tea shop that offers free drinks to attract customers and then raises prices once it has a monopoly. The problem is that this approach not only results in losses for the platforms but also forces other competitors to lower their prices, leaving the entire industry unable to make a profit and unable to invest in maintaining warehouse hygiene or ensuring product quality.
2. Suppliers are struggling: What happens when payment terms extend to six months?
Previously, suppliers could receive payment within 30 days after delivering goods to supermarkets. Now, with the growth of delivery platforms, these terms have been extended to two or even six months. For example, if a supplier delivers vegetables worth 100,000 yuan, they may not receive payment for half a year. During this period, they need to pay farmers, employees, and rent for the warehouse. Without cash flow, suppliers often turn to high-interest loans or cut costs (e.g., by purchasing cheaper, less fresh vegetables or skipping pesticide inspections), which can lead to food safety issues.
3. Hidden dangers of delivery platforms: Poor hygiene and a vicious cycle
The association has found that some delivery platforms have poor hygiene standards—refrigerators may not be properly cooled, leading to food spoilage; garbage in the warehouses may breed bacteria. This is because platforms invest all their money in price subsidies rather than hiring staff to clean and maintain equipment. Over time, this creates a vicious cycle: poor hygiene leads to product spoilage, customer complaints, increased platform turnover, further reduced funding for improvements, and ultimately, either business closures or continued reliance on capital to survive—damaging the entire industry.
4. The challenges for traditional supermarkets: Losing market share to delivery platforms
The convenience of delivery platforms (instant delivery) has attracted many customers from traditional supermarkets. Data shows that the sales volume of the top 100 supermarkets is expected to decline by 1.6% by 2025, with 4,200 stores closing. Supermarkets are already struggling with high rent and labor costs, and now they face additional pressure from low prices offered by delivery platforms. For example, if you used to buy fruits at a local supermarket but can now get them delivered for free within an hour via app, you're more likely to choose the delivery option.
5. The association's main demands: Bringing the industry back in balance
The initiative is not aimed at specific platforms but at addressing the overall imbalance in the industry:
- Ensuring food safety: Preventing suppliers from lowering product quality due to financial pressure, which could lead to food safety issues.
- Protecting suppliers: Requiring platforms to pay on time to ensure their survival.
- Promoting fairness: Preventing large platforms from monopolizing the market and allowing smaller suppliers and community-based stores to continue operating. Otherwise, consumers will have no choice but to accept higher prices.
Conclusion
Delivery platforms were initially a convenient solution, but excessive capital inflow has turned healthy competition into destructive strife—platforms losing money, suppliers struggling with cash flow issues, and traditional supermarkets under pressure. The association's initiative aims to slow down the industry's rapid development and focus on quality, fairness, and safety. Only when the industry is balanced can all stakeholders (platforms, suppliers, and consumers) benefit.