While CBME Insight visits regional markets, we often encounter impressive maternity and baby stores that surprise us in one or more aspects, such as product display, service experience, operational methods, and the thoughts of the store owner.
Therefore, CBME Insight has launched the “Jinxing Plan,” where we will focus on shining maternity and baby stores and discover the wisdom behind their survival through store visits and dialogues.
In this “Jinxing Plan,” we enter Jieyang, Guangdong, and approach Golden Spoon.
If you trace back the origins of many boutique maternity and baby stores, they generally have roots in “personal shopping” services.
However, with the impact of cross-border e-commerce, consumers returning to rational choices for foreign brands, and the larger profit margins of local products, many “personal shopper” owners have gradually transitioned to physical retail and adjusted their commodity structure, leaving behind the “personal shopping” business model.
While visiting the Guangdong market, in Jieyang of eastern Guangdong, we found such a high-quality maternity and baby shop—Golden Spoon, with two outlets each covering an area of 140 square meters and generating millions in annual sales. Its core business model has consistently focused on cross-border products for years, with bonded warehouse business accounting for over 60% of its operations.
What are the operational logics behind the entire business for the proprietor, Xie Hao?
01 Choosing Cross-Border Products: The Need for Speed and Caution
Currently, Golden Spoon operates a rich array of products, with over 70 kinds of formula milk; the barcodes for nutritional products are also over 80 different types.
In product selection, Xie Hao mainly abides by the principle of being “both quick and slow.”
“Quick” is reflected in keeping up with new series released by brands that have had past cooperation or have been settled in the market for many years.
Caution is shown in terms of new brands, which Golden Spoon will undergo a 1-2 year assessment period before introduction, after passing market tests.
02 No More Than Two Products with the Same Function
Xie Hao believes that once customers find it difficult to make a choice and cannot decide immediately, the probability that they will return to the store to purchase the product greatly diminishes.
Therefore, Golden Spoon’s stores typically won’t carry more than two of the same types of products. If a better-quality product emerges, the principle is to add the new one and naturally eliminate an old one.
“Each customer’s needs are different; a store cannot meet every consumer’s individual demands. Instead, it should guide consumers, help them find suitable products, rather than offer whatever they want.”
03 Deepening Service, Creating a Differentiated Advantage from Online Offerings
The rise of cross-border e-commerce has undoubtedly impacted maternity and baby stores like Golden Spoon, especially since the price difference is constantly narrowing.
As a result, Golden Spoon continually increases the proportion of its service sector. For instance, they recently acquired a system for height management. When consumers order milk from Golden Spoon, they can enjoy the system’s provided testing services, report analysis, and more.
04 Not Undertaking Ineffective Labor
An essential part of Golden Spoon’s operating philosophy is to avoid ineffective labor. They must ensure a certain profit margin to support the healthy functioning of the entire store. Even though many products are popular, they will be treated cautiously if the profit margin is thin.
This not only ensures profit margin but also helps Golden Spoon gradually filter out customers who are highly price-sensitive, allowing the store to focus more energy on serving more valuable customers with higher spending.
Of course, Xie Hao also emphasizes that although profitability is important in product selection, the product itself must also be good and attractive to consumers, “Even if the profit is high, if it’s not a good product, we will not choose it.”
Conclusion
In the nearly 10 years of entrepreneurship, Golden Spoon has always stuck with the cross-border product model. Despite many similar stores adjusting their business models over the past few years, Xie Hao has not wavered.
For Xie Hao, it’s clear which customers he serves and what kind of products and services he should provide them. He is also aware that blind transformation might yield short-term high gross profits but will result in the loss of competitive edge amidst endless rivalry.
It is due to this commitment to the broader direction and nuanced adjustments, that Golden Spoon, nearly ten years after its establishment, can still leverage its “small stores” of 140 square meters each to manage a “big business” with millions in sales.
