SHANGHAI :
New Retail U-Turn: Yonghui Closes First Tencent-Backed Super Species Store
Dou Shicong
DATE:  Jul 05 2019
/ SOURCE:  yicai
New Retail U-Turn: Yonghui Closes First Tencent-Backed Super Species Store New Retail U-Turn: Yonghui Closes First Tencent-Backed Super Species Store

(Yicai Global) July 4 --  China's Yonghui Superstores is closing its first Tencent-backed Super  Species outlet, a two-year old offshoot brand of small grocery stores,  in Shanghai today, aiming to reduce the costs that the parent's large  expansion into New Retail has caused.

Since Yonghui Yunchuang Technology, the operator of Super Species, achieved its goal of opening 100 Super Species outlets  nationwide last year it has started taking a closer look at each of  these stores' profitability, shutting down every outlet that cannot  reach its sales goals, news website 36Kr reported.

This year has proven tough  for Chinese offline-to-online grocers as Alibaba Group Holding closed  its first supermarket Hema store in May and a unit of Chinese retailer  Suning.Com bought French Carrefour's waning China business last month. 

Fuzhou-based Yonghui said  at the end of last year that it will exclude Yunchuang from its  financial reports to reduce the impact on the parent's performance. For  the first three quarters of 2018, the unit logged CNY1.5 billion  (USD218.2 million) in revenue, but its net loss was CNY617 million  (USD89.8 million), causing its parent's profit to decline by 18.5  percent. 

Tencent Holdings owns 15  percent of Yunchuang's equity after a deal penned in 2017, which  involved an investment of CNY187.5 million.

Editor: Emmi Laine 

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Keywords:   Tencent,Yonghui Superstores,Super Species,New Retail,Closure,Carrefour