Core Viewpoint - The article highlights the transformation of the beauty wholesale market in Wuhan's Han Zheng Street, emphasizing the search for new business models and value amidst significant changes in the beauty industry ecosystem [2][5]. Group 1: Current Market Dynamics - The wholesale market has traditionally handled the "dirty work" of the beauty retail chain, acting as a crucial link between brands, distributors, and manufacturers while facing challenges like gray market operations [4]. - Currently, the wholesale market serves as both a "reservoir" and a "transit station," addressing issues of overproduction and mismatched market demand by providing new distribution channels for unsold goods [5]. - The majority of wholesale businesses now focus on domestic beauty brands, with 90% of products being domestic, as international brands struggle to maintain profitability [5][8]. Group 2: Shifts in Business Models - Wholesale operators are increasingly targeting second- and third-tier brands, which offer stable quality and a well-controlled pricing system, ensuring product authenticity and reasonable profits across the supply chain [9]. - Some wholesalers are strategically transforming their operations by initiating joint procurement of popular and trending products to enhance price competitiveness and customer loyalty [9]. - The rise of live-streaming commerce has shifted the core clientele of wholesalers from traditional cosmetic stores to more flexible supply chain partners like live-streaming hosts, allowing for real-time inventory adjustments and "zero inventory operations" [11]. Group 3: Changes in Retail Relationships - Traditional cosmetic stores are distancing themselves from wholesale channels, opting for direct procurement from brands or agents to ensure product quality and service support [14]. - The shift towards online procurement is evident, with many retailers reducing their reliance on wholesale markets, even for popular consumer goods [14]. - The transformation of the wholesale model is exemplified by the Linyi wholesale market, which has adopted a dual business model of e-commerce live streaming and offline wholesale [16]. Group 4: Future Outlook and Policy Support - The article notes that the traditional wholesale market is undergoing profound changes, with the need for adaptation to survive in a competitive landscape where profit margins are shrinking due to increased price transparency from e-commerce and community group buying [21]. - The Chinese government's action plan aims to enhance the quality of the wholesale and retail sectors by promoting innovation, digital transformation, and the integration of domestic and international trade [24][25]. - The article concludes that while the golden age of traditional wholesale markets has passed, new opportunities are emerging for those willing to adapt to the evolving market landscape [25].