Super Box Math NB Goes to Beijing for the Exam: Can Hema’s Hard Discount Enter the Replication Phase Smoothly?

Hema's hard discount format "Chaoboxuan NB" is accelerating its nationwide expansion.

Recently, Chaoboxuan opened six stores simultaneously in Beijing, covering multiple districts including Chaoyang, Changping, Tongzhou, Huairou, etc.

Low prices are the first impression Chaoboxuan NB wants to leave with Beijing consumers. With items like Golden Pillow durians at 19.9 yuan per pound, watermelons at 0.99 yuan per pound, eggs at 16.9 yuan for 30, and mineral water at 9.9 yuan for 24 bottles, the grand opening immediately showcased its pricing strategy.

As the first stop in North China, Beijing is positioned by Chaoboxuan NB as a core base. Future store expansions, supply chain development, and warehouse network planning in North China will all radiate outward with Beijing as the center.

Beijing is a challenging market. In the past, hard discount formats have long lacked strong players in Beijing, indicating that this business model is not easy to implement.

Under relatively higher rent, more complex property conditions, and more fragmented consumption scenarios, Chaoboxuan NB must not only maintain its low-price model but also retest store density, site selection efficiency, and local supply chain capabilities.

Chaoboxuan NB's frontline continues to expand outward. Starting from East China, and entering South China, Anhui, and North China this year, soon to reach Southwest China, Chaoboxuan NB is progressing from a regional format to a nationwide replication.

According to its plan, Chaoboxuan NB aims to have over 600 stores by the end of this year.

While many peers are still refining their regional single-store models, Chaoboxuan NB has already pushed its battlefield nationwide. The question is, can scale continue to amplify its low-price advantage and enable it to capture a bigger share of the hard discount market?

Low-Price Philosophy, Operational Subtraction

Walking into a Chaoboxuan NB store, many middle-aged and elderly customers carry shopping baskets, comparing prices back and forth, stopping at the fresh and hot food counters to select items. These budget-conscious, family-oriented consumers are exactly Chaoboxuan NB's target group.

Chaoboxuan NB defines its target users as "pragmatic families"—those who consume rationally and value cost-effectiveness. The scale of surrounding cooking households is an important basis for site selection.

For such consumers, they need to reliably purchase meals and daily necessities at lower cost and in less time.

Behind low prices is a set of operational and supply chain systems centered on efficiency.

According to Yue Sheng, head of operations management at Chaoboxuan NB headquarters, store operations emphasize "eliminating all redundancy," continuously providing "quality and affordable" products for three meals daily.

This first manifests in its product assortment.

Chaoboxuan NB adopts a "broad category, narrow selection" product structure, with about 1,500 SKUs per store, retaining just a few selected goods under each subcategory.

Compared to traditional stores which cover more needs with richer SKUs, Chaoboxuan NB emphasizes concentrating limited space and inventory on high-frequency items.

Private-label and specialty products are key supports for this narrow assortment.

At present, private-label goods account for nearly 60%. This means Chaoboxuan NB not only compresses upstream procurement costs but also deeply participates in product definition, using its own brands to reinforce the low-price perception and differentiate products.

Meanwhile, many specialty goods that are co-branded or customized with established brands are retained, such as Nestlé KitKat, Xu Fu Ji Pineapple Cake, Snow Beer, and Xinxiangyin tissues.

For Chaoboxuan NB just entering the Beijing market, such items reduce consumers' unfamiliarity with low-priced goods and avoid excessive "white-labeling" of the assortment, leaving room for trust alongside low prices.

According to Mas, head of frozen and refrigerated procurement at Chaoboxuan NB, private-label development involves restructuring the cost chain from factory to shelf, eliminating brand entry fees, some intermediary logistics costs, and marketing expenses, to reveal the true cost of goods.

Execution-wise, first is direct sourcing from bases and controlling material costs with local warehouses;

Second, for items like edible oil, paper products, and dairy where logistics costs are relatively high, it finds suitable factories around cities to reduce transport costs;

Third, it relies on store scale growth to dilute single-item development, procurement, and distribution costs.

Chaoboxuan NB attempts to strip out costs previously absorbed by channels, marketing, and multi-layer distribution from item prices, redistributing them via scaled stores and high-turnover goods.

The "subtraction" approach also extends to store operations.

For example, store decor and setups are more restrained, shelf spacing tighter, basically only allowing two carts to pass side by side.

Yue Sheng explains that stores focus on red text white walls, bright lighting, prominent signage, so customers can quickly find items and complete purchases. Chaoboxuan NB rarely uses promotional slogans like "Today’s Special" or "Limited-Time Discount," instead emphasizing stable low prices, predominantly using paper price tags instead of electronic ones.

If prices don’t fluctuate often, there’s no need for frequent price changes and promotional maintenance, reducing store operation complexity.

A typical Chaoboxuan NB store staffs around 15 to 20 people, who cover multiple functions—restocking, sorting, picking, packing, sales, etc.—not just single roles.

Digital tools take over some judgment tasks previously reliant on manual expertise. Chaoboxuan NB combines weather, city consumption habits, and historical sales data for automatic ordering and replenishment, ensuring stable supply for residents’ daily needs.

All these designs ultimately serve Chaoboxuan NB’s determination to enter community retail with stable low prices.

Leaving the East China Comfort Zone

Hard discount is a business of scale and regional networks. Only with sufficiently dense stores can procurement, warehousing, fulfillment, and branding be diluted. This is the challenge for Chaoboxuan NB aiming for nationwide coverage.

It’s no coincidence that hard discount first took off in East China, especially Shanghai.

East China offers dense household consumption scenarios, a mature Yangtze River Delta supply chain, and intense retail competition. Consumers here accept quality consumption and are willing to reallocate shopping channels for stable low prices.

As it migrates across cities, Chaoboxuan NB must first adjust product assortments based on each city's dietary habits, consumption preferences, and supply chain conditions.

Chaoboxuan NB reveals that about 30%-40% of products in Beijing stores are local, similar to the proportion in South China.

For items like short-shelf-life vegetables and refrigerated dairy products sensitive to freshness and taste, Chaoboxuan NB adopts more local or short-distance supply chains; for potatoes, tomatoes, carrots and other easily stored items, it prioritizes source cost and chain efficiency.

But supply chain efficiency depends not only on procurement capacity, but also on store density. The same low-price model runs more smoothly in East China, where scale is established, than in North China’s early days.

Of the six initial Beijing stores, most are within community living radii, covering Chaoyang, Changping, Tongzhou, Huairou, etc., including community commercial spaces, neighborhood centers, small commercial bodies, and some directly built on the second floor of urban farmers' markets.

Yunchou, site selection head at Chaoboxuan NB, said that consumer habits, business environments, and property conditions differ greatly by area, so Chaoboxuan NB is still testing community consumption needs in different scenarios.

Currently, Chaoboxuan NB and Hema Fresh operate independent warehousing and distribution systems. "Beijing is the base for North China. How the market develops depends more on density and breadth, but the prerequisite is warehouse network planning," said Yunchou.

"Ultimate convenience" is the primary logic for site selection at Chaoboxuan NB. Stores don't have to be in the busiest, biggest commercial centers, but must be in locations most accessible to consumers.

In store formats, Chaoboxuan NB currently focuses mainly on two sizes: 600sqm and 800sqm.

In core city districts, where properties are scarce and rents are high, stores tend to be compact street-side stores of 600-650sqm; in neighborhood centers or small community malls, they position 800sqm stores as main regional outlets.

Kevin, creator of the Digital Retail Case Library, told All Weather Tech that Chaoboxuan NB's expansion does not start from zero. It stands on over a decade of Hema brand line trial-and-error, including the Hema X membership store, with both lessons learned and successful experiences as foundation.

In terms of scale alone, Chaoboxuan NB is already leading in the hard discount sector.

As of now, Chaoboxuan NB has 550 stores. Runner-up Aldi has only 108, all in Shanghai and Jiangsu; third place, Meituan Happy Monkey, just entering the hard discount field less than a year, has only 40 stores.

The urgency of national expansion comes partly from competition for offline locations in community retail. Quality spots are still scarce, and it's crucial to be first to secure consumers' daily supply radius.

Additionally, expansion is itself part of building backend supply chain capabilities.

Categories like snacks, beverages, paper goods, grains and oils, daily chemicals, frozen staple products, and prepackaged foods have small regional differences, long shelf life, low loss, and are easier for unified standards, procurement, and pricing.

Chaoboxuan NB aims to run a hard discount flywheel: more stores means larger procurement scale per SKU, enabling it to get lower prices and custom goods from suppliers; as procurement costs fall and margins improve, it can continue opening stores, spreading the same product assortment and supply chain to more communities.

From this perspective, the first store in Beijing is not just a local placement, but a key test of Chaoboxuan NB replicating its East China market advantage nationwide.

For the entire hard discount industry, the national war has only just begun.

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