Core Viewpoint - Hema's decision to exit the membership store business reflects a broader trend in the Chinese retail market, indicating a shift away from the membership supermarket model that gained popularity in recent years [1][3][4] Group 1: Hema's Membership Store Closure - Hema will close all its offline X membership stores by the end of August this year, marking its exit from the membership store sector [1] - The X membership store model, initiated by Hema in 2020, required consumers to hold a membership card to shop, with annual fees of 258 yuan and 658 yuan [1] Group 2: Market Trends and Competitor Actions - The membership supermarket model gained traction in China after Costco's successful opening in Shanghai in 2020, prompting various retailers like Hema, Yonghui, Carrefour, and Metro to enter the market [3] - However, five years later, membership stores are fading from the business strategies of these retailers [3][4] - Yonghui and Metro have not mentioned warehouse membership stores in their recent annual reports, while Carrefour's first membership store in China closed in 2023 [4] Group 3: Challenges Facing Membership Supermarkets - Successful membership supermarkets rely on strong supply chain networks, precise product positioning, operational excellence, and brand trust [4] - Costco and Sam's Club have built unique product procurement pools through global supply chains and have tailored products based on member preferences [4] - Hema's X membership store faced issues such as product quality control fluctuations and membership rights management problems, contributing to its decline [4] Group 4: Broader Implications for the Retail Industry - The exit of Hema from the membership store model signifies a rational return in the retail industry, as the initial enthusiasm wanes [5] - The essence of membership supermarkets is not merely a replication of business models but a deep integration of supply chain, product strength, operational capability, and brand trust [5] - Retailers are encouraged to reassess their strengths and seek more suitable development directions rather than forcing entry into mismatched business areas [5]

Core Viewpoint - The article emphasizes that the essence of membership-based supermarkets is not merely a replication of business models but a deep integration of supply chain, product strength, operational capability, and brand trust, which requires time to develop into a systematic project [1][5]. Group 1: Membership Supermarket Trends - Hema has decided to close all offline X membership stores by the end of August this year, marking a complete withdrawal from the membership store format [2]. - The membership supermarket format, which originated in the U.S. and entered China in the 1990s, requires consumers to pay a membership fee to gain shopping access, distinguishing it from traditional supermarkets [2][3]. - The initial enthusiasm for membership stores, sparked by Costco's success in Shanghai in 2020, has faded, with many retailers like Yonghui and Carrefour moving away from this business model [3]. Group 2: Challenges Faced by Membership Supermarkets - Membership supermarkets require a robust supply chain to ensure product uniqueness and cost-effectiveness, with Costco's model exemplifying this through its strict gross margin policy [3][4]. - Product strength is a core competitive advantage, necessitating a deep understanding of member preferences, as demonstrated by Costco's focus on high-income families and Sam's Club's appeal to the middle class [4]. - Operational capabilities are critical, with Hema's X membership store facing issues such as product quality fluctuations and member rights management, contributing to its decline [4]. Group 3: Brand Trust and Market Positioning - Membership stores operate on a "fan" business model, where brand trust is a significant competitive advantage, as profits are derived from membership fees rather than product markups [5]. - The decline of membership supermarkets reflects a rational return to the industry, prompting players to reassess their strengths and consider more practical market strategies [5].

Core Viewpoint - The recent promotional activities surrounding the 88VIP anniversary have led to confusion among Hema's paid members, resulting in a surge of refund requests due to pricing discrepancies and the closure of Hema X membership stores [1][3]. Group 1: Membership Pricing and Refund Issues - Hema's existing paid membership system faced disruption as 88VIP members could access Hema's services at a significantly lower price, leading to dissatisfaction among current members who paid higher fees [1][3]. - Hema announced the closure of its last Hema X membership store by August 31, further reducing the benefits for existing members and prompting many to seek refunds [1][3]. - The company has started offering refund services for remaining benefits to some members, with a notable increase in customer service inquiries regarding refunds [1][3]. Group 2: Strategic Shift and Membership Operations - Hema's paid membership was a significant revenue source, contributing approximately 588 million yuan annually from nearly 3 million members at the end of 2022 [3]. - The company has experienced strategic fluctuations in its membership approach, halting new memberships in December 2023, only to reassess and reintroduce membership renewals four months later [3][4]. - The closure of Hema X membership stores raises questions about how Hema will manage member operations within its existing framework, especially under Alibaba's broader strategy to integrate various platforms [4][5]. Group 3: Market Position and Competitive Landscape - Hema's decision to close the X membership stores reflects challenges in positioning between its premium offerings and fresh produce, alongside supply chain disadvantages compared to competitors like Sam's Club [4][12]. - The competitive landscape is intensifying, with other membership models like Sam's Club and Costco performing well, putting pressure on Hema's membership strategy [12][13]. - Hema's shift away from the membership store model is part of a broader strategy to focus on more profitable ventures, such as Hema Fresh and Hema NB, which require less capital investment and offer quicker returns [11][12].

Core Viewpoint - Hema is shutting down its membership store format, which was once seen as a potential growth avenue, indicating a strategic shift in its business model [5][6][8]. Company Summary - Hema X membership stores will cease operations, with the last store in Shanghai closing on August 31, 2023, marking the end of this business format [5][6]. - The membership stores were launched in October 2020, with a peak expansion in 2021, reaching a total of 10 locations by October 2023 [6][7]. - Membership fees were set at 258 yuan per year for gold members and 658 yuan for diamond members, targeting middle-class and high-end consumers [7][8]. Industry Summary - The decision to close membership stores is part of a broader strategy to focus resources on Hema Fresh and Hema NB formats, which are expected to yield quicker returns [8][9]. - The competitive landscape for membership stores is intensifying, with established players like Sam's Club and Costco, as well as new entrants like Dailu Fa, increasing pressure on Hema's membership model [11]. - The retail industry is facing significant challenges, with many traditional supermarkets experiencing declining sales, prompting a shift towards online shopping and innovative delivery models [12][14].