Abstract: on the one hand and Ma Yun jointly build "Alipay Hongkong wallet" and join Tencent's new retail force, Li Jiacheng has a way to play "two horses".
Author: Shu Hong
In June 2018, after a new round of $14 billion financing for Ant Golden Clothes was completed, a partner of an internationally renowned large PE said he was going to kowtow to Tencent to apologize for the simple reason: they cast Tencent's strong rival.
Investors in Ant Gold were also asked to sign a non-competition agreement to stop investing in Alibaba's competitors, Tencent and Jingdong, or to raise their stakes.
According to the Financial Times, both Ali and Tencent have asked their own investment banks not to serve each other.
However, there is a man between the "two horses" to achieve the right and left.
New members of Tencent retail team
On October 25, Watson Group's Baijia Supermarket announced that it would join Tencent and Yonghui's new retail team to form a new joint venture, Baijia Yonghui.
Yonghui and Baijia will inject their Guangdong regional "Bravo Yonghui Supermarket" operations, their Baijia and TASTE stores into the new joint venture. The assets of the joint venture will be opened to the outside world in the future. Tencent, which owns 10% of the new company, said it would provide the capabilities and technologies in its "digital toolbox".
The intention of Tencent is not clear enough to win the battle of "double eleven" before the war.
Head players in the retail market are speeding up the pace of regional resource integration. Since 2017, Yintai Department Store, Bailian Group, Lianhua Supermarket, Xinhua Lian, Gaoxin Retail (Darun Fat, Oshang) has been put into Ali's arms; after taking a stake in Yonghui, Tencent has also successively won Wal-Mart, Carrefour, step-by-step, Tianhong shares and so on - the situation of the two "station team" has been further established.
It is worth mentioning that the Watson Group's Baijia Supermarket, one of Hong Kong's two oldest supermarket brands (the other is Huikang), was once the industry that Hong Kong's richest man, Li Ka-shing, was determined to sell.
In September of this year, WeChat launched the "brush face payment" in the PARKnSHOP supermarket. But at the same time, Li Jiacheng's Changjiang Hutchison also had a joint venture with the ant gold suit in Hongkong to operate the Alipay wallet in Hongkong. The retail stores in the Yangtze River and Hutchison's stores in Hongkong all rejected WeChat's payment.
In Hong Kong, Li Ka-shing's shadow is ubiquitous, and his assets cover telecommunications, real estate (Yangtze River real estate), retail (Watson's, Best Supermarket, Fengze Electrical Appliances) and many other aspects. Li Ka-shing's commercial kingdoms, including the Yangtze River Heji (Changjiang Industries, Hutchison Whampoa), Changshi Group, the Yangtze River Infrastructure and Electricity Industries and Industrial Trusts within the system, have a market capitalization of over HK$trillion.
Watson's official data show that China's Best Hundred Supermarket is a subsidiary of Watson's Group, a member of Hutchison Industries on the Yangtze River. It operates in more than 50 countries and operates five core businesses, including ports and related services, retail, infrastructure, energy and telecommunications.
In July 2013, in an attempt to split Watson's retail business into a public offering, Li Ka-shing sought to sell the underperforming Best Supermarket for $1 billion to $2 billion. Meanwhile, Zhengda Thailand, China Resources, Yongwang Japan, Woolworths Australia, Carlyle, KKR, TPG and so on once became potential bidders. But three months later, Hutchison Whampoa issued a notice to suspend the sale of 100 Best Buy because the bidders failed to meet their expectations.
At that time, an insider said, "Li Ka-shing has spoken, so far, Bai Jia should continue to accelerate the implementation of the growth strategy, especially focusing on the mainland market."
Contrary to expectations, in recent years, Bai Jia has been shrinking the front line in the mainland of China. The 100 Jia supermarket, which once owned 21 stores in Shanghai, was completely closed in 2012. After that, Bai Jia quit Yunnan in September 2014 and left Chengdu in March 2016, and eventually fell back to Southern China. Today, Baijia has 56 stores in Guangdong Province, including 22 TASTE stores.
Marriage with Tencent and Yonghui, in other words, is also Li's "Changhe" in curve off the Baijia supermarket's mainland business.
Who is the winner?
For this cooperation, the three sides show their respect in the press conference. Li Qiming, Watson's managing director, said: "The first time we met, it was very fatal. Everyone got on well with each other. In a very pragmatic manner, a joint venture company has been formed in just a few months."
Zhang Xuanning, founder of Yonghui Supermarket, said frankly, "Watson's such a large enterprise is willing to cooperate with us, we are touched by glory."
Tencent stressed that as an Internet company and technology company, Tencent has a clear boundary: Tencent does not do retail, but hopes to help partners to carry out digital changes through seven digital weapons, such as public numbers, small programs, payment, cloud computing, social advertising, and so on, to solve the connection, transformation, body A difficult test.
After joining Tencent, Yonghui has been trying to build a benchmark for smart retailing. Yonghui Supermarket and Tencent have been in the store location, big data marketing, digital transformation, online mall building, home scene mining and other aspects of the attempt.
According to Tian Jiangxue, vice president of Tencent Intelligent Retail Strategic Cooperation Department, Tencent and Yonghui have established a joint working group to work closely together since this year to complete the digital transformation of two benchmark stores in Fuzhou and Shenzhen. At the same time, it has also entered the innovative format of Yonghui's "satellite storage".
At the equity level, Yonghui and Baijia invested 622 million yuan and 502 million yuan in stores, accounting for 50% and 40% of the shares respectively, and Tencent invested 125 million yuan in cash, accounting for 10% of the shares.
Responding to all-weather technology, Li Qiming said Yonghui holds 50%, which reflects Watson's spirit of cooperation, "Yonghui develops faster in technology retailing, equity and development should be equal."
Li did not directly answer why he cooperated in a joint venture rather than in a direct sale of assets. He pointed out: "This tripartite cooperation is a'dream combination', Baijia Yonghui's goal is very clear, is to become the largest supermarket giant in Guangdong Province."
From the perspective of cooperative resources, Yonghui will integrate the Bravo Yonghui supermarket in Guangdong into new business, and the two new retail formats, Super Species and Yonghui Life, have not participated yet. In terms of Baijia, Hong Kong, Macau and South China, where Baijia supermarkets are deeply cultivated, it has Baijia supermarkets, TASTE, FUSION, GREAT, convenience and other businesses. This time, Baijia supermarkets and TASTE are injected into the joint venture.
According to Zhang Xuanning, after the merger of the two stores, Baijia Yonghui will have 70 stores, the pace of future store opening should be faster, the first goal is to quickly reach annual sales of 10 billion yuan. According to Yonghui semi annual report, this is equivalent to 1/3 of Yonghui's income in the first half of 2018 (32 billion 600 million yuan).
Yonghui Supermarket pointed out in the announcement that the establishment of a joint venture will help Yonghui's performance in Guangdong.
Guangdong market used to be a soft spot that Yonghui supermarket could not touch. By the first half of 2008, the total number of Yonghui stores had reached 952, with 48 in Guangdong (including 13 Red Mark stores, 5 Green Mark stores, 21 Yonghui Living and 9 Super Species), accounting for only 5% of the total.
All-weather technology learns that this cooperation from the supply chain, Yonghui and Baijia will do some integration, joint venture management and operation will mainly be handed over to an independent team. However, due to Yonghui holding 50% stake in the joint venture company, the board of directors occupies more seats, which can meet and meet the demand.
According to Yonghui Supermarket's semi-annual report of 2018, the company's operating income during the reporting period was 34.397 billion yuan, an increase of 21.47%, but its net profit fell by 11.54% to 933 million yuan. After deducting the income and expenditure unrelated to its operation, its net profit fell by 20.33% to 826 million yuan.
Play "two horses"
Li Ka-shing, an industrialist, is not an outsider of the Internet, although he has not successfully landed on the Internet. In the past few years, Mr. Li has invested in Facebook, Siri and Skype, and in mutual funds, he has also invested in BitPay, Traity, Osper, and so on. He is truly the "big money" in Silicon Valley.
In August 2016, WeChat paid and Alipay won the first batch of Hongkong savings payment tools licences, then launched a mobile payment war in Hongkong. In order to attract Hongkong people to throw away credit cards and octopus, the two sides burned a lot of money.
Li Jiacheng and Ma Huateng are Chaoshan townships, and Li Jiacheng's son Richard Lee, founded by PCCW, was an early investor in Tencent. From absolute user volume, WeChat has more active users than Alipay. But in the war on mobile payment in Hongkong, Li Jiacheng chose to cooperate with Ma Yun.
In March 8, 2018, ant gold clothing announced that the joint venture company AlipayHK (Alipay Hongkong wallet) was established in Hongkong with Hutchison Industrial Company to launch Alipay's business in Hongkong.
At present, Wechat Payment has covered the mainstream shopping malls and chain brands in Hong Kong, including Ocean Park, Sasha, Chuo Yue, Colourmix, Chow Tai Fu, Liufu jewelry, King's jewelry clocks and watches, Chihuahua cake house, seat hall, Aesop, Max Mara, TSI, Broadway and other brand chain stores.
But with Li Jiacheng's cooperation, Alipay quickly occupied more consumers' daily consumption scenarios in Hongkong.
According to the data, there are more than 600 stores under the flag, covering real estate, electricity, tap water, telecommunications, food, electrical appliances, retail and other aspects. The number of customers reached 6.6 million, equivalent to about 90% of the total population of Hong Kong. After the agreement was reached, the retail businesses of Changjiang Hutchison's Hongkong, such as Watsons and PARKnSHOP supermarket, had access to Alipay Hongkong wallet and signed an exclusive agreement.
In the past, Li Jiacheng and Ma Yun had talked apart. In 2013, Ma Yun led Alibaba to Hong Kong to discuss the IPO, said: "This is the era of the Internet, no longer belong to Li Ka-shing. Li Jiacheng was very good in his time, but now it is impossible to have another Li Jiacheng. No one in the world knows that you can be red for 5 years. The only way to solve your undefeated, not old and not confused is to believe in young people! "
In an interview with Caixin. com in 2014, Li Jiacheng praised Ma Yun's youthfulness and accomplishment. "The most important thing for a nation is to have generations of outstanding entrepreneurs." He also said that he "when I see successful Chinese entrepreneurs, I can only applaud and cheer them up in my heart."
"Both are China's leading technology, we are in line with a very simple purpose, that is, customer first, any technology can improve customer service, we will use it." Speaking of cooperation with the two sides of Ali and Tencent, Li Qiming said so.
He added: "Tencent is providing us with great technical support for our joint venture company (Bai Jia Yonghui), and Ali is a joint venture in Hongkong for Alipay. We are taking the lead in two aspects, and our relationship is very good and very happy."
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