With the deep cultivation of the one-to-one express delivery track in the past 10 years, Flash Delivery officially landed on the U.S. stock market and was listed on the NASDAQ on October 4, 2024. But then there was news that in addition to the one-to-one express delivery model, flash delivery has begun to make new attempts, and intends to create a new brand squirrel express. It is said that Squirrel Express will be divided into squirrel delivery (one-to-one, one-to-many delivery) and squirrel single (many-to-many delivery), of which one-to-one delivery is the dispatch mode, and one-to-many and many-to-many delivery are order grabbing modes.
In response, the official customer service of Flash delivery said that the squirrel express order is a third-party platform order, and the price is lower than the flash delivery order.
Although the flash move is a bit sudden, it is also reasonable. It is understood that the reason why flash delivery has been focusing on the one-to-one emergency delivery track has nothing to do with the views of its founder and CEO Xue Peng. In his view, because the urgent delivery demand of individual users is difficult to predict, and the distribution demand of catering merchants is easier to predict in advance and match the corresponding capacity, compared with the B2C distribution that mainly serves catering merchants, the C2C model will form a strong competitive advantage once the scale is formed.
Facts have also proved that flash delivery has become an industry leader in years of development, and has defined the service standard and timeliness of one-to-one urgent delivery. According to the relevant data released by iResearch, in terms of revenue in 2023, flash delivery accounts for about 33.9% of the domestic independent one-to-one express delivery service market, still ranking first.
But the problem is that for individual users, urgent delivery is a relatively low-frequency demand after all. Moreover, the main one-to-one urgent delivery mode means that the target users of flash delivery need to be willing to pay a higher price for timeliness and services. In addition, due to the high unit price, the difficulty of flash delivery to expand to non-first- and second-tier cities naturally increases. Previously, it was reported that the franchise of flash delivery in lower-tier cities has been suspended this year.
As a result, the flash delivery that adheres to the one-to-one urgent delivery mode has slowed down in recent years. According to the relevant data released by the official, from 2021 to the first half of 2024, its revenue will be less than 3.040 billion yuan, 4.003 billion yuan, 4.529 billion yuan, and 2.284 billion yuan respectively.
The lack of orders also makes it difficult to maximize the value of riders. It is understood that by the end of 2023, the scale of flash riders has reached 2.7 million, far exceeding Dada's 1.2 million and SF's 950,000 in the same city. However, according to the prospectus previously released by Flash Delivery, the number of active riders on the platform is not high. It is understood that in 2023, the number of orders on the platform will reach 270.7 million, and the number of daily orders per active rider will be 9.3. According to this calculation, the number of active riders in Flash Delivery is only about 80,000 per year, accounting for only about 3% of the number of registered riders.
More importantly, in addition to the slowdown in revenue growth, Flash is also facing the problem of profitability. According to the prospectus, from 2021 to 2023 and in the first half of 2024, the revenue of flash delivery will be 3.040 billion yuan, 4.003 billion yuan, 4.529 billion yuan and 2.284 billion yuan respectively, and the net profit will be -291 million yuan, -180 million yuan, 110 million yuan and 124 million yuan. Among them, it is pointed out that this is mainly due to the increase in subsidies determined by relevant departments at their discretion, and its profitability is not sustainable.
At the same time, with more and more Internet manufacturers pouring into the instant retail track, and more and more large manufacturers increasing their takeaway business, the value of transportation capacity has also begun to rise. According to a research report on the instant delivery market released by CICC, in the instant delivery application scenario, the number of food and beverage takeaway orders accounted for 70%, the number of fresh fruits and vegetables accounted for 12%, the number of supermarket convenience orders accounted for 10%, and the number of one-to-one urgent delivery orders accounted for only 3%.
In such a situation, it is not difficult to understand that flash delivery no longer sticks to one-to-one urgent delivery, but more actively develops the B-end market. It is important to know that one-to-many and many-to-many distribution is also the main mode of competing products such as Meituan's errands, although it will inevitably sacrifice a certain amount of service quality, but the advantage is that it can greatly enrich both ends of supply and demand.
All in all, although the one-to-one express delivery model still works, it is not without flaws. And if you continue to stick to this "one acre and three points of land", flash delivery will miss a larger market. Taking a step back, even if Flash is willing to take a corner of the country, it will not escape the squeeze of competitors.
But flash sending out of the "comfort zone" is also a few joys and a few sorrows. Naturally, it is friends who are worried, and it is platforms such as Douyin and Kuaishou that are happy to hear and see. As mentioned above, capacity is now a scarce resource in real-time retail, food delivery, and other home scenarios. You don't see that even a platform like Meituan, which has millions of riders, has begun to cooperate with third-party capacity platforms one after another.
For Douyin and Kuaishou, which have abundant traffic, the lack of transportation capacity has become the core factor restricting the development of their instant retail and takeaway businesses. Taking Douyin as an example, although the continuous flow of traffic has created a good foundation for it to try different businesses, just like the logic of interest e-commerce, with the advantages of traffic and algorithms, Douyin Takeaway has a stronger control over user attention and content consumption, and can accurately realize "goods looking for people", thus forming a differentiation from the "people looking for goods" on platforms such as Meituan Takeaway. However, there is no abundant transportation capacity, and the goods cannot be delivered to consumers in time, and even if the traffic is continuous, it can only be energetic and nowhere to go.
In fact, Douyin Takeaway has cooperated with transportation platforms including flash delivery, but the cost of the one-to-one urgent delivery model is too high. According to the prospectus of Flash, from 2021 to 2023, and in the first half of 2024, the average revenue of a single order of Flashsend will be 19.2 yuan, 18.8 yuan, 16.7 yuan, and 16.5 yuan respectively. Although this data shows a significant downward trend, it is undoubtedly much higher than the capacity cost of Meituan Takeaway and Ele.me.
Considering the problem of balancing the cost of third-party delivery, it is not easy for Douyin Takeaway to actively reduce the unit price of customers, which may be the reason why it meets users in the name of "group purchase delivery". However, in the takeaway market, which is increasingly emphasizing low prices and immediacy, the logic of using high customer unit prices to share distribution costs is obviously not appropriate.
However, the one-to-many and many-to-many delivery models are expected to help Douyin Takeaway significantly reduce the cost of fulfillment. According to the details of a Squirrel Express order shown by a rider, a meal delivery 1.3 kilometers away can earn 5.03 yuan. This means that merchants can reduce costs and riders can win by volume.
In other words, with the gradual relaxation of restrictions on the platform's nearly 3 million riders, a win-win situation is expected to continue to unfold.
[The picture in this article comes from the Internet]