Meituan Shuttered 5 Offline Stores

Due to the saggy sales, Meituan Dianping continues to scale back its business,and five offline supermarket stores will be closed in the near future.

Meituan Dianping gained Tencent’s substantial investment and made great profitability from its Chinese food delivery business. But it will shutter its Ella Supermarket stores, just one year after launching them.

According to Meituan’s announcement, it will close five stores in Wuxi and Changzhou as a result of mismanagement, however, its two Beijing stores will continue to operate. The stores, which are similar to Alibaba’s Hema supermarkets, focus on fresh produce and feature online ordering and 30-minute delivery service for local customers.

It seems that Meituan is going through a widespread scaling back of businesses. Besides the closing of some of its Ella Supermarket stores, the company also shuttered the Asia Pacific operations of its bike-sharing business Mobike.

Less than one year after Meituan acquired the global Mobike business in 2018 for $2.7bn, the company started to lay off staff across its offices in Singapore, Malaysia, Thailand, India and Australia. The move followed a plunge of shares after announcing operating losses of RMB 3.45bn ($497m) for the June to September quarter in 2018.

Meituan is also readjusting and evaluating its growth plans for car-hailing service. Meituan said that it would not attempt to expand beyond Shanghai and Nanjing as previously planned.

Besides Meituan, many other company also pull out of the offline fresh produce category, SF Express, China’s courier and delivery service, also closed its SF Best high-end grocery stores this year.

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Ms. Cindy CUI
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Email: cindy.cui@duxes.cn