Sinopec gets involved in e-commerce winning geometry

Since January 1, 2012, Sinopec launched the B2C online shopping platform Express. Sinopec’s e-commerce attempt is being accelerated in silence. On December 12, 2012, Sinopec Guangdong Petroleum Corporation once again made efforts to launch a comprehensive B2C online shopping platform that aims to build customized oil purchase service platforms tailored to customers' needs for oil and build non-oil products for owners. The products and services of more than 2,000 fuel card outlets, more than 1900 Express Stores, and more than 100 direct sales and wholesale offices under Guangdong Petroleum have been moved online. In addition to satisfying the owners' needs for online oil purchases, EasyGate also launched thousands of single products, including automotive products, specialty products, and department stores. This is seen as a signal that Sinopec has extended to e-commerce.

However, the industry questioned: The main advantage of e-commerce is price concessions. With the long-term monopoly of the current petrochemical industry players to the market, online buying of oil is not cheap, and it is undoubtedly an e-commerce company that has lost its price advantage. For traditional enterprises such as Sinopec, Sinopec is trying to find breakthroughs in local characteristics and sell some local specialty products. But basically, there is nothing extraordinary in comparison with the general B2C online shopping platform. How to open up the market? How to form your own core competitiveness?

Sinopec's provincial branches gradually promoted this e-commerce - selling oil and selling department stores, facing many challenges and doubts.

An industry insider that the author contacted pointed out that although Sinopec has money, but the current e-commerce is universally deficient, Sinopec wants to enter this field and “does nothing” without much potential advantage. Moreover, compared with other e-commerce websites, the distribution of Sinopec e-commerce is unusually low-key and quiet, and only some customers with Sinopec fuel cards know that the existence of this online shopping platform makes it difficult to attract eyeballs. In addition, regardless of whether it is a large convenience store with a gas station as its core or a marketing network platform to explore e-commerce development, it is undisputed that Sinopec has hoped that the non-oil business will become its new profit growth point, but according to the above-mentioned insider, “currently Most of the Sinopec convenience stores are at a loss, so it can only be said that the e-commerce industry has squeezed in a 'burnout'."

The above-mentioned industry analysts believe that Sinopec has only some advantages in e-commerce business in terms of distribution. Sinopec has a nationwide distribution network and a first-class distribution service team. Compared with general e-commerce websites, logistics costs are a great advantage. Since the sales companies in each region of Sinopec have their own logistics distribution centers, relying on this to do the centralized distribution of e-commerce products will effectively reduce the circulation costs. “But this advantage is currently only focused on oil distribution, and it is difficult to graft onto department stores.”

At present, Sinopec Express convenience store non-oil products basically rely on some local large shopping malls for distribution, relying on the complete logistics system of the local large chain supermarkets, completing the distribution and return exchange procedures for the gas station convenience stores, and paying local supermarket logistics departments. Aside from a certain commission, no capital or equipment investment is required. However, due to the fact that there was a certain distribution fee in the middle, the price of the goods in the Express convenience store was generally higher than other supermarket prices. In order to change this unfavorable situation, Sinopec can only establish central warehouses and local second-level warehouses to achieve direct purchases by manufacturers and reduce the number of goods to be transferred; at the same time, it must also create non-oil products “bin to store” integrated logistics warehousing and transportation. The distribution system can save various costs of goods from the warehouse to the middle of the retail store, and this must have an independent and powerful logistics and distribution system.

It is understood that all branches of Sinopec, including the Anhui branch, are building non-oil central warehouses to concentrate logistics advantages. Not only that, Sinopec has also explored leveraging third-party logistics to complete its non-oil business. In March 2011, Sinopec Guizhou Petroleum Branch signed an integrated cooperation contract with Guizhou Express Express Logistics Co., Ltd. for Sinopec "Econometrics" convenience store. Guizhou Provincial Postal Express Logistics Co., Ltd. provides integrated logistics and distribution services for the “Jie Jie” convenience store, a gas station owned by Sinopec Guizhou Petroleum Branch. It can be seen that Sinopec’s leading edge in oil logistics cannot sustain its non-oil business logistics blueprint. After entering the e-commerce industry, it needs to implement a new round of logistics integration.

The number of Express convenient stores is huge, and the distribution business of e-commerce is complicated. If you take the form of individual purchases and distribution, it will easily cause chaos and increase the cost of inventory management; therefore, it needs to be unified. Distribution and purchase need to form a complete logistics chain.

Although Sinopec currently has the largest number of convenience stores in China, the sales network has also become the country's largest convenience store retail network. However, it is too naive to want to take a place in e-commerce simply because of the advantage of selling oil and huge capital. In the days when e-commerce is surging and fierce competition, Sinopec has taken advantage of a convenience store network and a non-oil logistics service network that has not yet been fully integrated to develop e-commerce. This situation is irresistible. The mode of "gas station + convenience store + network platform" seems to be very simple. However, it is obviously not easy to tie in with these services. Although Sinopec has a huge oil transportation system, now they need to build a new product distribution system and a huge distribution plan. After entering the e-commerce industry, it is necessary to adjust the product supply chain as well as the warehousing integration. At the same time, we must also address the online post-sales and distribution issues. It can be said that the road ahead is long and the road is in danger.