On the morning of June 16, Chairman Wu Xiangdong of Chinese Liquor Heroes Alliance was invited to attend the “Wuzhen Liquor Industry Forum”. He delivered a speech, pointing out that “Chinese Liquor Heroes Alliance” will be the biggest liquor supply chain platform. Chairman Wu Xiangdong also won the “Top 10 Chinese Merchants Influencing Chinese Liquor Industry in 2015” award.

Wu Xiangdong said “Chinese Liquor Heroes Alliance” held totally 14 Internet+ seminars from January 10 to June 13 and the number of members who signed the contract exceeded the expectation which is 5,000. After nationwide speaking tours are finished, the number will exceed 7,000.

Wu Xiangdong said “Chinese Liquor Heroes Alliance” will create an efficient community, create an Internet+ business about fast moving consumer goods (“FMCG”) whose scale is over RMB1 trillion, create a cloud data logistics and financial service platform, and create a joint investment platform whose scale is over RMB100 billion. First of all, the alliance will build China’s biggest liquor supply chain platform to lay a solid basis for the future FMCG B2B platform.

1. Create an efficient community

“Chinese Liquor Heroes Alliance” is different from ordinary loose communities because it is a close and efficient organization. Members communicate freely every day, share cases and courseware regularly, and organize and participate in various offline activities together. Each community is established based on group, and the group leader and liaison are responsible for management and providing services.

2. Create a FMCG Internet+ business whose scale is over RMB1 trillion

Wu Xiangdong pointed out that doing B2B should target at reaching the scale of RMB1 trillion or else it will be very difficult to survive. According to practices, it is good if rate of return from B2B transaction fee reaches 2‰- RMB200 million can be returned if transaction fee is RMB100 billion, but the expenditure might reach RMB500-1,000 million. Thus, it will be very difficult to make profit if B2B does not reach a certain scale.

In 2015, China’s total retail sales were RMB30.7 trillion and FMCG wholesale sales were over RMB5 trillion. Wu Xiangdong said that it is not unrealistic for B2B and O2O platforms of the alliance to realize RMB1 trillion business scale within the next five years.

“Chinese Liquor Heroes Alliance” does FMCG B2B and O2O businesses based on 12 million terminal outlets- 6 million restaurants and 6 million retail terminal outlets in China. The 6 million restaurants are downstream customers of the alliance, so it will start from here.

Liquor consumption features strong instantaneity. Why is the proportion of online liquor shopping business less than 3%? The reason is that randomness of liquor consumption is strong. It is common that consumers order liquor suddenly. But this problem cannot be solved by B2C.

3. Build a cloud data logistics and financial service platform

Investigation has shown that logistics cost of members can be lowered by over a half. Most of members have their own warehouse and warehouse keeper. Logistics cost will be incurred as long as a liquor product is sent out. This problem can be solved by adopting the central distribution system. Based on the preliminary plan, 4 distribution sites will be set up in one city. And the problem of goods preparation before the busy season can be solved through cloud data.

If a member needs turnover of funds, the alliance can loan it hundreds of thousands of yuan and even millions of yuan in a few seconds. And members can put money on the alliance’s financial platform for wealth management.

4. Build a joint investment platform whose scale is over RMB100 billion

6,000 members of “Chinese Liquor Heroes Alliance” will do investment together. If each invests RMB1 million, the total will be RMB6 billion. The alliance plans to invest totally RMB100 billion in the future.

In the speech, Wu Xiangdong made a solemn commitment that the alliance will not compete but will ally only. It will not confront famous distilleries and will maintain price system of famous distilleries; it will not compete with upstream and downstream enterprises and will not seize upstream and downstream resources; it will cooperate closely with upstream and downstream enterprises to create the “No. 1 Ecological Circle of the Liquor Industry”. The alliance will follow closely tier-1 famous distilleries and famous liquor brands with local advantages, and will cooperate closely with them. The alliance will only do B2B and O2O businesses, do logistics distribution business for helping members saving money and do financial service platform business… In short, the alliance will only do things which members are unable to do and will not compete but will ally only with members- this is the core principle of the alliance.

Imagine that the alliance will have nearly 10,000 liquor agents as members which are agents of nearly 10,000 producers. It means that “Chinese Liquor Heroes Alliance” will become the biggest liquor supply chain platform in China.