SaaS product solutions for the fresh fruit industry

The 2020 epidemic accelerated the digitalization process of offline brand chain stores, and many offline chain brands began to focus on building online channels. Today I will share a customer case. They adopted the middle platform construction model to connect online and offline channels, and increased the store's daily turnover by 30%-80%. They built a data middle platform + AI algorithm to guide daily operations, effectively reducing store management and operating costs.

1. Customer market situation

The boss is the founder of a fruit brand chain store. The stores are mainly distributed in second- and third-tier cities in the south. There are 30 stores in total, mainly franchise stores, two of which are directly operated stores opened by the boss's relatives.

The main sales volume is achieved by affordable, high-quality and low-priced seasonal models. Some of the imported products are high-gross-margin models, plus some profit models. The daily turnover of the popular shop exceeds 5,000 yuan, the average daily turnover of the store exceeds 2,000 yuan, and the store area is about 30-60 square meters.

The stores are mainly opened near hospitals, medium and large residential areas, and commercial streets, with community stores being the main type.

Due to the epidemic, the number of people continued to decline, which seriously affected daily revenue and caused a backlog of some goods. The shelf life of fruits is short, and those that are not fresh can only be sold at a low price to clear the stock.

In this market environment, plans to expand new stores were severely hindered, franchisees' investment confidence was dampened, sales of popular stores dropped by 30%, and other stores dropped by 20%-50%. Some stores also opened online stores such as Meituan and Ele.me to save themselves, but the effect was limited due to operational capabilities and system problems. Fruit shops in the same industry are also having a hard time, with some closing down to avoid losses.

2. Main business demands of customers

Now we urgently need new sales channels to increase sales and make up for the lack of offline traffic. Reduce store management costs and product losses through a systematic approach, and conduct unified marketing activities to maintain the brand and old customers.

• The system should be able to connect offline ERP and online sales channels, and centrally manage products, orders and inventory.
• The store built its own WeChat mini program mall, allowing new and old customers to enter the mini program to place orders, reducing dependence on external channels and costs.
• Open up new online channels, mini programs, offline membership card information, centrally manage membership information, and conduct membership marketing
• Real-time data reports, which can count store sales and hot-selling products
• Inventory risk management, freshness management, stocking order management, etc.

The rest involves commercial secrets, so I won’t go into details.

3. Analysis of Customer Business Demands

From the market situation and customer business demands, we know that the reduction in offline traffic is the core problem. We must first focus on the sales end. First, we should build multiple channels including Meituan Takeout, Ele.me Takeout, JD.com Home Delivery, etc.; provide in-store pickup and community group buying services; build mini-programs and community operations, marketing activities, member marketing and other methods to attract new customers and promote activation, and at the same time add recharge management to bind the consumption capacity of new and old customers.

Connect new channels and offline ERP systems to reduce the costs of new channel product management and inventory management.

We will further optimize and improve the supply side, add data middle platform and AI algorithm capabilities, build intelligent product selection and ordering in stores, and manage inventory risks, reduce the burden on store managers, and allow the system to intelligently manage inventory and reduce product losses.

4. Top customer industry situations

Baiguoyuan is the largest fruit brand chain store in China, mainly based on franchise stores, with nearly 4,000 stores across the country. Build an integrated new retail system that sets an industry benchmark and has the ability to cover the entire chain from supply to sales.

It connects all channels including offline stores, Baiguoyuan app and food delivery platforms, and supports group purchase services such as home delivery within 30 minutes and in-store pickup.

In addition to providing basic functions such as goods, transactions, distribution, inventory, after-sales, membership, and group buying, the sales side builds a retail digital platform that supports marketing platforms, real-time pricing, product recommendation engines, intelligent price comparisons, sales forecasts, intelligent ordering, and product planning forecasts.

The supply side provides warehousing services, logistics services, procurement management, quality control and inspection capabilities, standardized planting platforms, planting guidance, etc.

Fruit products are mainly aimed at the mid-to-high-end market, and are characterized by high standards and high prices.

5. Industry Solution Research

The industry's solutions mainly focus on multi-channel, inventory management, membership unification, smart stores, multi-terminal malls, and big data.

• Multi-channel construction and management: One-click access to multiple channels to solve the synchronization and management of goods, inventory, price, transaction, after-sales, and financial information;
• Member unification: Identify channel customers and members, reduce new customers and marketing costs, build customer and member portraits, identify channel value, improve conversion and retention, and conduct member marketing and recharge marketing;
• Digital stores: digital transaction management, online and offline integration, technology empowerment, data guidance, and reduced operating and management costs;
• Multi-terminal mall: Establish mini-programs, apps, and h5 proprietary malls to reduce channel dependence and risks, and maintain consistent multi-terminal coverage;
• Data + AI: data screen, daily business report, sales report, intelligent product selection, intelligent ordering and replenishment, inventory risk prediction, loss prediction, etc.
• Stores and supply chain: franchise management, franchise settlement, store management, procurement and sales management, supplier management, order management, etc.

Through discussions with the boss, the headquarters operations team, franchise store managers, and industry solution analysis, the project vision and expectations were determined, and a phased iterative evolutionary approach was adopted for construction and development.

VI. Strategic objectives of the project

The strategic goals of the first phase are: build new sales channels, focus on attracting new customers, connect Meituan, Ele.com, JD.com and offline ERP and cash registers, unify the management of goods, orders, inventory, marketing activities, order reminders, order printing, etc.; establish store operation records and business guidance, and assist store managers in management and operations (finding sales channels).

The strategic goals of the second phase: reduce inventory and losses, reduce store management costs, build a data center to introduce AI algorithms, build intelligent product selection and ordering, stock inventory management, sales forecasting, loss management, and freshness management. (Cost reduction)

The strategic goals of the third phase: retain new customers and maintain old customers, reduce channel costs, member marketing, operational performance management, member recharge management, mini-program marketing, WeChat group marketing; establish operational new customer acquisition and retention performance to fully mobilize the enthusiasm of stores. (Seeking development)

The strategic goals of the fourth stage: store management, franchise management, rate management, settlement management, operation management, performance appraisal, data screen, indicator guidance, etc.

The strategic goals of the fifth phase: opening up the supply chain, supplier management, inventory management, ordering and stock preparation management, etc.

The first three stages focus on building store management and operation capabilities, while the later stages focus on building and strengthening overall brand and store management capabilities, and supply chain capabilities.

7. Product Architecture Design Ideas

The advantage of offline physical stores is that they are close to customers, and the clerks help customers choose products and promote transactions. They have certain execution capabilities, but lack operational and marketing capabilities. The headquarters operations team has rich operational and marketing capabilities, and can give full play to the store execution capabilities and headquarters operational capabilities. The store side maintains basic operational functions, emphasizes execution capabilities, reduces management and operating costs, and tries to rely on the system to complete daily operations and management work.

The headquarters will build unified management capabilities, strengthen store operations, channel operations, and marketing operations capabilities, and guide and assist stores in performing various operational tasks and work.

The entire product architecture is divided into the sales channel end, cashier counter, store manager management end, and headquarters management end. The cashier counter is simplified from the store manager management end and is only used for store cashier counters.

The sales channel belongs to the to c part, and the o2o e-commerce system is very mature and will not be introduced in detail here.

The store manager's management position is the execution side. In product design, the operation and management parts are handed over to the headquarters operation team. The store only needs to worry about how to execute the ledger and serve the customers, and does not need to participate in complex operational matters such as product selection, pricing, stocking, maintaining channel stores, planning marketing activities and membership activities.

The headquarters operations team has overall control and is responsible for all store marketing and operations matters.

8. Functional Planning

Sales channels: physical stores, Meituan Takeaway, Ele.me, JD.com, mini-app mall

Business platform: stores, products, inventory, prices, orders, delivery, fulfillment, after-sales, marketing, coupons, discounts, full discounts, members, rights, recharge, finance, channels, cash registers, printers, order reminders, revenue, ERP management, accounts

Data center: data reports, daily business reports, intelligent product selection, intelligent ordering, intelligent stocking, freshness warning, sales forecast, inventory warning, loss warning

IX. Store Manager Management Terminal Function List

10. Function List of Headquarters Management Terminal

11. Project Investment Expectations

A system customization model is adopted, with each store investing 10,000 yuan and the brand investing 100,000 yuan; the investing stores can use the system free of charge in the first year, and pay a technical service fee of 5,000 yuan per year thereafter; non-investing stores (including new stores) pay a technical service fee of 7,000 yuan per year. We promise that the technical service fees for the invested stores will never be increased.

At this point in the project, market research, industry solution research, vision and strategic goals, and product architecture design have been completed. Next, we will proceed to the first phase of product development. The biggest challenge encountered at this stage is data synchronization caused by differences in product information among Meituan Waimai, Ele.me, and JD.com, as well as how to quickly iterate and verify the product value of this phase through the MVP model.

Appendix: SaaS MVP Checklist

Share a self-inspection checklist for a SaaS product in the MVP stage. Use the self-inspection checklist to supplement and improve the preliminary research and product design of SaaS.

Author: Xu Xiaowei

Source: Xu Xiaowei