INSTANT RETAIL’S 60 BILLION YUAN CLUB

Lao Zhang (Zhang Chenyong) is a Chinese instant retail expert whom I have been following for a few years now. Recently, in his frequent posts on his WeChat account, he shared an interesting thought: after Meituan took over Dingdong Maicai (see my article here: chinadigitalretailrepor…), they became a member of the ’60 billion yuan club’.

▶️ Walmart’s Sam’s Club reached 140 billion in sales, half of which is sold through e-commerce. Most of this is done through its ‘cloud warehouses’ and a smaller part through next-day delivery. This means their instant retail business will exceed RMB 60 billion.

▶️ Alibaba’s Hema (Freshippo) had over RMB 100 billion in sales according to a memo of its CEO. 60% of its sales are instant deliveries, so also RMB 60 billion.

▶️ The front-end warehouse business of Meituan Xiaoxiang (Little Elephant) was estimated to be at least RMB 40 billion. After it acquired Dingdong Maicai, which had over RMB 20 billion in annual sales, Meituan now also reached RMB 60 billion in size.

Together these three now form the top tier of the grocery instant retail market.

Last year, during a masterclass I gave during a ChinaTechTrip study tour, I showed how front-end warehouses like Meituan Xiaoxiang and Dingdong Maicai had already become larger than some traditional supermarkets in China (see table below).

It’s quite eye-opening that the instant retail business of these three players, excluding in-store sales and next-day delivery, already makes them bigger than the fifth-largest supermarket chain in China. And it’s just a matter of time before they will make up the top 3. As a matter of fact, Hema has probably already overtaken RT-Mart, which is unlikely to have grown much (if at all) in 2025.

As I said before, the supermarket business will be ruled by internet companies and traditional chains that have successfully applied instant retail.