Group 1 - The National Computer Virus Emergency Response Center detected 70 mobile applications, including "Pupu Supermarket," for illegal collection and use of personal information between July 2 and July 29, 2025 [1] - The specific version 5.6.4 of "Pupu Supermarket" was reported for not implementing necessary security measures such as encryption and de-identification [1] - The problematic version 5.6.4 is no longer available for download on the Huawei App Market, with the latest version 5.6.8 released on August 7 [2] Group 2 - "Pupu Supermarket" faced prior issues in 2020 for not clearly informing users about all privacy permissions requested [7] - In July 2023, the company was monitored by the Fuzhou Market Supervision Administration for pesticide residue exceeding safety standards in a product, but no legal action was taken due to sufficient traceability documentation provided by the company [7] - CEO Chen Xingwen, who has a background in advertising, founded "Pupu Supermarket" in 2016 after recognizing opportunities in the fresh e-commerce sector and is reportedly in talks with leading investment banks for a potential IPO in Hong Kong [8]

Core Viewpoint - Pupu Supermarket, a fresh e-commerce platform founded in 2016, is preparing for an IPO in Hong Kong after achieving profitability in 2024, distinguishing itself through a cautious regional expansion strategy and a focus on local markets [1][4][12]. Company Overview - Pupu Supermarket was established in Fuzhou and has expanded to cover nine cities, including Xiamen and Wuhan, with a market penetration rate exceeding 70% in Fuzhou by 2019 [1][2]. - The company has built over 400 front warehouses, with a significant portion exceeding 1,000 square meters, and offers a wide range of products with an average order value of over 80 yuan in Fuzhou [6][9]. Financial Performance - Pupu Supermarket achieved annual revenue of approximately 30 billion yuan in 2024, with a gross margin of 22.5% [4][12]. - The company has undergone five rounds of financing from 2016 to 2021, reaching a valuation of 5 billion USD [4]. Competitive Landscape - The fresh e-commerce sector has seen significant competition, with major players like Meituan's Xiaoxiang Supermarket and Dingdong Maicai entering the market, posing challenges for Pupu Supermarket [17][19]. - Pupu Supermarket's cautious approach contrasts with the aggressive expansion strategies of competitors like Meituan and Dingdong Maicai, which have faced substantial losses [8][9]. Operational Strategy - The company employs a front warehouse model that has allowed it to maintain lower fulfillment costs, achieving a fulfillment expense ratio of 17.5% [6][9]. - Pupu Supermarket's user repurchase rate is high at 47%, indicating strong customer loyalty [9]. Challenges Ahead - Despite achieving profitability, Pupu Supermarket faces challenges such as increasing delivery thresholds and a relatively low proportion of self-operated products, which could impact future growth [13][14]. - The company has received over 6,000 complaints regarding service quality, highlighting potential operational issues [14].

Investment Rating - The report does not explicitly state an investment rating for the instant retail industry Core Insights - Instant retail is defined as a consumption model based on an instant delivery system, emphasizing "online ordering, delivery within 30 minutes," allowing consumers to quickly obtain needed products [7][8] - The market size of China's instant retail reached 650 billion yuan in 2023, with a year-on-year growth of 28.89%, outpacing the growth of online retail by 17.89 percentage points [17][19] - By 2030, the instant retail market in China is expected to exceed 2 trillion yuan [19] Summary by Sections 1. Instant Retail Overview - Instant retail activates "scene consumption," meeting immediate needs, contrasting with traditional retail's reliance on "demand forecasting" [7][8] - The development of instant retail can be traced back to the emergence of food delivery platforms a decade ago, evolving into a high-speed growth phase post-2015 with platforms like Meituan and JD Daojia [11][13] 2. Background of Instant Retail's Rise - Consumer demand has shifted towards faster delivery, with over 50% of post-95 consumers wanting same-day or even within-hours delivery [24][27] - The Z generation's market share surged from 30% in 2020 to 59%, driving a shift towards "emotional value consumption" [30] - Technological advancements, including the integration of the internet and big data, support the growth of instant retail [32] 3. Reshaping of Consumption Scenarios - Instant retail has expanded from food delivery to encompass a wide range of products, including fresh produce, pharmaceuticals, and electronics [43][44] - New consumption scenarios have emerged, such as "hot pot delivery" and "instant meal kits," significantly reducing food waste [45] - Instant retail platforms have partnered with pharmacies to provide 24-hour medicine delivery services across over 300 cities [47] 4. Business Models of Instant Retail - Platform-based instant retail companies leverage various methods to acquire traffic, such as Meituan's integration with its food delivery service [60] - The front warehouse model is employed to ensure rapid response to consumer orders, particularly in densely populated areas [63] - The warehouse-store integration model enhances quality consumption by combining online and offline sales [71] 5. Competitive Landscape of Instant Retail - The market is characterized by a "one strong, many strong" structure, with Meituan leading with a 35% market share and over 10 million daily orders [79] - Major platforms have built strong supply chain systems and efficient delivery networks, enhancing their competitive edge [81][82] 6. Challenges Facing Instant Retail - Cost control is a significant challenge, with high warehousing and delivery costs impacting profitability [95] - Supply chain stability is crucial, as demand fluctuations can lead to supply interruptions [97] 7. Future Trends in Instant Retail - Instant retail platforms are expected to deepen service scenarios, such as offering laundry pickup and delivery services [109] - The integration of AI and IoT technologies will enhance operational efficiency and product quality assurance [118][119] 8. Development Recommendations - Companies should invest in AI and IoT technologies to optimize delivery routes and ensure product quality [131][132] - Strengthening partnerships with local producers and wholesalers can create a more agile supply chain [133]