In front of the bustling PANGDONGLAI Angel City, I witnessed the closure of a supermarket in Xuchang, and observed the local retail landscape's transformation. One day at the end of March, Wang Haiyang and his friends were strolling around Wanda Plaza in the center of Xuchang and stumbled upon a notice of closure referring to a branch of Yonghui Supermarket. The notice detailed the story behind the scenes, with market rumors suggesting the closure was due to internal adjustments, but the locals privately think that PANGDONGLAI's strong appeal may be the real reason for Yonghui Supermarket losing its customers.

After verification, this Yonghui Supermarket branch was established in November 2018, and the newly opened PANGDONGLAI Angel City is very close to it. Moreover, PANGDONGLAI's store layout in the region is closing in layer by layer, suggesting from the outset a severe challenge to Yonghui Supermarket. The store's closure is clearly an indirect result of PANGDONGLAI's competitive strategy for the local residents.

At the same time, a DASHANG Newmart supermarket in the area also engaged in intense market tug-of-war with PANGDONGLAI, marked by their geographical positioning, which led to a closely watched business competition. The opening of PANGDONGLAI Life Plaza signifies PANGDONGLAI's transition attempt from a traditional wholesale store to a comprehensive supermarket, thereby triggering a new round of "commercial warfare".

Wang Huizhong, a scholar with in-depth research in the business field, reviewed the process of this competition in detail in her writings. Residents seemed to have a lukewarm opinion of PANGDONGLAI in the past, but it was only after the opening of DASHANG Newmart that they began to notice the advantages and services offered by PANGDONGLAI, which demonstrated its unique strategy on the market competition level.

In this regional business landscape competition, the key issue is that PANGDONGLAI has proven its regional strategy in terms of scaling, supply chain management, and cost control. However, whether these strategies can be successfully replicated in the national market remains to be seen over time.

With the increasingly fierce market competition, many locals have started to recognize and favor PANGDONGLAI, the local supermarket with good service attitude and detailed after-sales service. Consumers like Wang Haiyang, after experiencing the services of both supermarkets, ultimately choose to return to PANGDONGLAI. In the past, they were even willing to park at DASHANG Newmart, a competitor, to save on parking fees and walk to PANGDONGLAI to shop; but now, they feel somewhat guilty towards DASHANG when they think about it.

In response to the competition challenge from DASHANG Newmart, PANGDONGLAI did not engage in direct marketing responses; instead, it proactively closed several small supermarket stores in early 2012. Even from March that year, they began to close every Tuesday, seemingly inadvertently giving that day's revenue to their competitor. However, in the end, DASHANG Newmart's Xuchang main store still announced its closure.

On February 28, 2022, DASHANG Newmart's Xuchang main store published a closure notice, stating it would officially close on March 1, 2022. Although the notice did not elaborate on the specific reasons for the closure, the general belief is that its service advantage was not prominent in the fight against PANGDONGLAI, leading to customer loss, supermarket operational difficulties, and financial issues. The exit of DASHANG Newmart marks the end of the "duel of the giants" in the Xuchang retail market.

It is worth mentioning that the competition between Pang Dong Lai and local supermarkets dates back to 20 years ago. Du Wenyu witnessed the confrontation process between them. The origin of the Xuchang supermarket business can be traced back to the volume-selling industry in 1995, which gradually transformed regional commercial enterprises from capital accumulation to development and expansion. Pang Dong Lai's predecessor was a small tobacco and liquor store called Wang Yue Lou Fatty's Store, run with the assistance of Dong Lai's family members. Although the shop was small, it was here that the founder Yu Dong Lai promoted the concept of "sincere service," which eventually expanded the shop into a nationally renowned supermarket group, with a peak employee number exceeding ten thousand.

Other local retail businesses that started in the '90s include Jiu Di Supermarket, Yi Feng Supermarket, Zhi De Supermarket, Kai Duan Volume-Selling (later renamed Xin Kai Duan Supermarket), and Xi Ying Men Supermarket. These enterprises also became an important part of the retail market in Xuchang.

With time, the 1990s and the subsequent couple of centuries showed an unprecedented intensity of competition in Xuchang’s retail market. Local enterprises such as Pang Dong Lai, Xin Kai Duan, and Yi Feng Supermarket, each launched a wave of store openings to capture market share. In particular, before announcing the closure of its stores, Pang Dong Lai had over 30 branches in the Xuchang area, including comprehensive supermarkets like Pang Dong Lai Times Square and Life Square, as well as street-side volume-selling supermarkets.

However, such intense market competition also brought a heavy blow to some of Xuchang's retail enterprises. Xin Kai Duan Supermarket, once rivaling Pang Dong Lai in the number of stores, faced a capital chain break due to over-expansion and eventually had to close down many stores. Its founder was also frequently seen in court due to private lending issues. Yi Feng Supermarket, after a series of market competitions with Pang Dong Lai, gradually decided to give up competing head-on, choosing instead to open stores in subordinate counties and cities such as Yuzhou and Changge, and began to expand into real estate, catering, liquor industry, automobiles and other fields in search of a diversified business model.

The supermarkets still active in the Xuchang retail industry today include Jiu Di Supermarket, Fatty Supermarket, Xi Ying Men, as well as later-established enterprises like Happiness Home, Hengyuantong, and Xinda New. When opening new stores, they generally try to avoid direct competition with Pang Dong Lai. Especially Jiu Di Supermarket—though almost the same age as Pang Dong Lai—the competition between the two is no longer as intense as it once was. Most of Jiu Di's branches are located far from Pang Dong Lai; for example, its largest Jiu Di 369 City Life Plaza is based in Xuchang's southern suburbs, an area not frequently engaged by Pang Dong Lai.

In terms of pricing, local supermarkets also strive to maintain a certain distance from Pang Dong Lai. Taking the price of fresh pears as an example, the purchase price at the wholesale market is about 1.5 yuan per jin, local supermarkets like Xinda New, Jiu Di, and Happiness Home usually set the retail price at about 1.98 yuan per jin, whereas Pang Dong Lai’s stores generally have a higher retail price. According to the investigation by reporters from Yicai, the price of beef in Pang Dong Lai is also generally about 10% higher than that of surrounding small supermarkets. Despite this, consumers are still willing to pay a higher price for Pang Dong Lai’s goods, mainly because of trust in their quality. One loyal customer shopping at Pang Dong Lai's Golden Triangle store expressed that although aware of the high prices, the shopping experience is reassuring, "It's more expensive, but at least you know it's real beef," and in case of quality issues, there is also a "tenfold compensation" after-sales guarantee. This kind of trust and sense of security is something other supermarkets cannot provide.

Therefore, in Xuchang, the shopping habits of citizens have started to polarize: Those who care about quality and after-sales service prefer to choose Pang Dong Lai; while consumers who are more sensitive to prices tend to shop at other local supermarkets.

In today's retail format, Pang Dong Lai's high-quality service has become widely acclaimed, turning into a valuable brand equity. "Although it's difficult for us to compete with Pang Dong Lai, to stay vital in competition, we must discover and amplify our own advantages," said a person in charge of Xinda Xin Happiness Times Plaza. Compared to Pang Dong Lai, their supermarket has a significant price advantage, which has greatly attracted the shopping interest of the surrounding residents.

Wang Haiyang shared an interesting experience, saying: "Not long ago, during a dinner with friends, we talked about the topic of supermarket services, and everyone generally believed that Pang Dong Lai offers high service quality." However, when the topic shifted to commodity prices, they thought some local chain supermarkets, despite being smaller in scale, are quite attractive in terms of pricing and are no less competitive in the frequency and strength of promotional activities. “This might just be the way of survival for those local second-tier brand supermarkets, and it is also their strategy to win customers," he added.

After winning customers' hearts with high standards of service quality, people are also pursuing tangible discounts and truly considerate benefits. In the end, every penny spent, like water poured out, cannot be returned.

Local businesses, in competition with Pang Dong Lai, have adopted the strategy of adjusting their opening hours. Pang Dong Lai opens at 9:30 AM, while they choose to open at 8:30 AM, using this extra hour to welcome customers earlier and try to retain price-sensitive consumers with promotional activities.

While actively responding to market competition, some local chain stores are also quietly undergoing self-reform, gradually emulating Pang Dong Lai's successful model. Taking Xinda Xin as an example, although the supermarket area on its B1 floor is smaller than that of Pang Dong Lai, its product display is quite in the style of Pang Dong Lai, and it seems particularly attentive in details of customer service. For instance, to solve the problem that shopping carts cannot go through rolling escalators, Xinda Xin set up a dedicated chain shopping cart passageway, with staff providing help and guidance.

Hengyuan Tong Supermarket has replicated Pang Dong Lai's "home delivery" service. An elderly resident living opposite Hengyuan Tong in Yongfeng Xincheng International District said that due to the inconvenience of carrying groceries, supermarket staff proactively offered to deliver goods home for free, even not minding to come back later to retrieve the shopping cart.

In addition, Jiudi Supermarket's Xinjiayuan branch has set up pet storage cages at the entrance, which is a rare service outside of first-tier cities. When asked about this, a person in charge said that they are trying their best to emulate the service philosophy of Pang Dong Lai, "No matter how Pang Dong Lai does it, we'll learn from them."

This person in charge also pointed out that they have recently renovated the supermarket to upgrade the display effect of commodities, striving to match the standards of Pang Dong Lai.

Different stores of the same brand may show significant differences in merchandise display. The commodity arrangement at Jiudi Supermarket's Xinjiayuan branch is more orderly. This has even attracted the attention of the senior management of Yonghui Supermarkets, who after visiting the Pandonglai Angel City, announced in early May that they would implement "Pandonglai-style" adjustments and renovations, starting with the Yonghui Supermarket's Hanghai Bei Jin store in Zhengzhou and the Baolong Plaza store in Xinxiang.

This trend of "Pandonglaization" is gradually spreading across the national retail market. "Pandonglai-style" adjustments and renovations have been implemented in two supermarkets and three department stores of the Hunan Bubugao Group. After integrating Pandonglai's corporate culture and operation strategies, Bubugao Group has systematically adjusted multiple aspects including wages, working hours, store layouts, product upgrades, supply chain management, pricing systems, and service quality improvement. The Changsha Meixihu store and the Xiangtan store have become the pioneer examples, introducing a variety of Pandonglai's signature products.

According to data provided by Bubugao, since May, the daily average sales of the Changsha Meixihu store have reached 1.51 million yuan, with daily customer traffic hitting 12,600 people, and an average per-customer transaction of 120 yuan. Especially during the "May Day" holiday, daily average sales even surpassed 2.1 million yuan, with daily average customer traffic climbing to 15,963 people. Compared to the pre-adjustment figures of daily average sales of 150,000 yuan and daily average customer traffic of 2,000 people, the results are very significant.

In the Xuchang regional market, Pandonglai has undoubtedly become a dark horse in the retail industry. Judging from the performance of several Bubugao Group stores that have undergone adjustments, the results are quite good. However, Pandonglai's operational strategy still shows its regional characteristics in terms of scalability, supply chain management, and cost control. Whether this regional strategy can achieve the same success nationally remains to be tested by the market.