Wednesday, October 31, 2012

"Small is beautiful" a successful business model targeting Chinese mass market

I told you in another article that in China "there is no such thing as a free lunch". http://chinanonstop.blogspot.fr/2012/10/problem-terrace-how-to-solve-conflit-in.html
Whenever anyone in China wants something with you, think twice about what he has to gain.

There is another important business and very accurate business principle in China: "small is beautiful".
As I was staying in Changsha in 2006 and came back in 2012, I can see the success of a few concept aiming Chinese mass market. 
There a few successful businesses based of the same business model and principle: small is beautiful.



Key success factors:

  • Target the huge Chinese mass market
  • A tiny commercial place and a small rent. Rent matters a lot of course.
  • Location on the first floor
  • Small but sufficient prices with a fair margin
  • Offer suitable to Chinese taste. This is probably the most difficult aspect: here roasted chickens and ducks
  • A good image. It can be based on logo, name, design, origin, packaging, product...
  • Take away
  • Sometimes delivery
  • A street with many people passing by. Often nearby universities or animated districts. Location is very important.
  • One or two employees can take car of everything: minimize salary costs



Roasted Chicken and ducks






Oiled roasted and very well cooked chicken: "Beijing style ducks and chicken" as Chinese customers like them.




"Small and beautiful" concept: big companies rule

The small is beautiful concept is the only one that is affordable and open to small daring, creative individual.
Even though I realize that most of these succeful concept are franchised. Why is it so?
In fact these concepts as not as easy as they appear:

  • you can invest a smaller amount but you still need the good design, name, image, logo
  • You need the good product. And this requires a lot of thinking and creativity
  • There is often a large factory behind all these small shops. It will prepare and deliver food ingredients, sauces, ready to serve products.
  • Chinese customers love big chains. In there eyes: big chains= real, good, famous, hygiene, authentic foreigners

In the end I find out that most of these successful concepts are imagined by big groups from Taiwan, Hong Kong and sometimes from mainland China.




The "Small is beautiful" business model works for different products such as:
Dried meat shops
Taiwan pancake shops
Small coffee, tea, drinks, cookies shops
and more recently: sushis, pizzas...

I will tell you more about it in some coming article.
Don't forget to share my blog ;-)

2 comments:

  1. Your blog post is very unique and well research, Thanks for your research on academic knowledge…


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    Replies
    1. Thanks a lot!
      I have less time to write article in my blog as I do daily youtube video. But I promess I will try to catch up.

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