Chinese Grocery's Age of Empires

CHINESE GROCERY’S AGE OF EMPIRES

TWO GIANT GROUPINGS ARE CARVING UP THE MARKET CHINESE GROCERY’S AGE OF EMPIRES

Chinese retail is evolving into two rival empires, each dominated by competing e-commerce giants. One realm is centered on Alibaba, which owns two of China’s largest e-commerce platforms, Taobao and TMall, as well as an electronic payments system, AliPay. The other is an alliance between JD, a leading online retailer, and Tencent, an internet and digital-technology conglomerate that owns WeChat, China’s most popular social-media app. These two empires already own the digital lives of Chinese consumers today, where the average Chinese spends over 60% of their mobile app usage on either ecosystem.

Now Alibaba and Tencent/JD have set their sights on physical retail, including acquiring stakes in six of China’s top 10 hypermarkets, the country’s biggest electronics retailer, one of the largest department stores and the largest commercial property and entertainment conglomerate.

Exhibit 1: Empire of JD/Tencent and Alibaba

Experiece Online Physical Online Offline Social retail retail influence influence JD/ Mobike, QQ Vip.com, Little Walmart, Tencent Video, WeChat Pay, WeChat, QQ, Tencent University, Red Book, Yonghui, Dianping, JD logistics, LY.com, Qzone, Tencent Cloud, YHD.com, Wanda, Sogou, QQ Meituan Pengyou.com QQ Gaming, Zhuanzhuan Carrefour Music, WeChat DiDi ChuXing Pay Alibaba Ali Health, Taobao Etao, Taobao, Intime Retail, MGTV, YTO express, Sina Weibo, Group Education, Hema, Tmall, New Huadu, Yicai.com, 36Kr, Cainiao, Alipay, Momo, Amap.com, Suning.com Bailian, SCMP, Alipay Ali LST, Koubei Qyer.com, Xiami, Eleme, Century Mart, AcFun, Youku DiDi ChuXing, Sanjiang, Sun Ali Cloud Art, Hema

Source: Oliver Wyman analysis

Underlying their growing dominance is Chinese consumers’ enthusiasm for online shopping: In 2006, just 11 percent of the population enjoyed internet access; today, more than 460 million Chinese – one-third of the population – regularly shop online.

Exhibit 2: Number of online shoppers in China from 2006 to 2016 IN MM

500 466.7 413.3 361.4 301.9 250 242.0 160.5 194.0 74.0 108.0 33.6 46.4 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Source: CNNIC, Statista 2017

Copyright © 2018 Oliver Wyman 3 Unlike in Europe and North America, food shopping – the largest retail segment – is moving online too, encouraged by densely populated cities that favor rapid, efficient home delivery. As a result, nearly 10 percent of the Chinese population shops for groceries online, compared to just 3 percent in the United States and 6 percent in the United Kingdom, Europe’s highest rate. And room for expansion remains: Already, an estimated 5 percent of Chinese shoppers buy groceries exclusively online, indicating plenty of potential growth if more people stop shopping for food in physical stores. To gain still more customers, the e-commerce giants are introducing new shopping formats – dubbed O2O, or online-to-offline – that blend online shopping’s convenience and wealth of information with the social experience and physical contact with products that people enjoy in traditional, brick-and-mortar stores.

An important foundation of the tech giants’ retail innovations is their dominance in mobile payments, of which 97 percent are processed by either Alibaba or Tencent. Mobile payments are already used for 35 percent of grocery purchases, and even when customers shop outside the big e-commerce platforms, they can still be a valuable source of data. Through the payments systems, the empires learn where, when, and what customers are buying, and complement it with the rest of their digital ecosystem to see which websites they like to visit, the apps they use, and whom they follow on social media.

Exhibit 3: Development of mobile payment landscape in China MARKET SHARE BY PLAYER MARKET SIZE OF MOBILE PAYMENT IN CHINA 2017H1 IN TN RMB 2% 120 108 100

32% 80 202% 60 65%

40 35

20 16 8 1 AliPay WeChat Pay Others 0 2013 2014 2015 2016 2017F

Source: Mobile payment association, Yiguan, Union Pay, Oliver Wyman analysis

China’s traditional supermarkets and convenience stores can’t compete with this onslaught, and both their like-for-like sales and their margins are declining (see Exhibit 4).

But they may survive in some form with help from the online giants themselves. Both Alibaba and JD have developed logistics systems based on centralized, large-scale networks of warehouses, which can replace traditional distribution. For supermarkets, the online giants can thus provide the means to deliver fresh food quick enough to satisfy demanding Chinese home cooks. They have also developed software that helps old-fashioned corner shops more easily access and tap into their logistics system to directly order goods.

Copyright © 2018 Oliver Wyman 4 Exhibit 4: Declining performance to traditional big box grocers LFL REVENUE GROWTH RATE EVOLUTION BY PLAYER, 2010 2016 OPERATING MARGIN BY PLAYER IN % 2012 VS. 2016 IN % 15 2012 2016

10 CRE1 4.42 -4.63 5 Wumart1 3.5 2.03 0

-5 Yonghui 3.0 3.0

-10 San Jiang4 4.2 2.9 2010 2011 2012 2013 2014 2015 2016

1. 2015 number for CRE and Wumart is as of H1 FY2015; CRE figures are based on retail segment result figure as reported in the annual report “Segment Result“, mainly consisting of CR Vanguard, Chinese Arts & Crafts, CRCare, VIVO, Pacific Coffee, etc. | 2. Based on retail segment result figure as reported in the annual report “Segment Result” representing earnings before interest income, finance costs and taxation, to which we’ve added back the annual net gain on disposal of non-core investments and valuation surplus on investment properties | 3. As of 2015 due to data availability | 4. 2011-2014 LFL not available; 2015-2016 comparison on same store revenue growth; includes convenience store etc Source: Corporate annual reports, Investor presentations, Analyst reports, Oliver Wyman analysis

Both empires are building their O2O power through three plays, each of which blends their online capabilities with offline stores in new ways.

Exhibit 5: Future of retail in China: Major plays by the empires 1 2 3 Experiments with new Strategic partnership with Reinvention of traditional “mom and retail formats traditional big box retailers pop” shops Start to open own O2O retail Strategically invest in Capture the B2B opportunity to have fewer formats to showcase what offline giants to facilitate layers, higher efficiency, and more transparency “future” looks like their transformation and within RTM, and disrupt traditional distributors/ realize synergy wholesalers

Taobao.com, YHD.com, JD, Tmall.com Brands Stay in the center of retail ecosystem and interact with every stakeholder e-Commerce platform Ali/ Already became the JD’s retail 3 largest players in empire Ali LST, JD China grocery market Xintonglu Alibaba Group, JD, Tencent Consumers Lianhua, Hema, Quik, Walmart, (multiple layers of) 7 Fresh, JD Bailian, RT-Mart, Distributors/ Convenience Yonghui, wholesalers store, Tmall Carrefour 2 1 Xiaodian

Retailers

Source: Oliver Wyman analysis

The first play is the development of new formats that blend digital and physical features to create imaginative new solutions. Many large supermarkets worldwide now offer online services, where customers can order via a website and have food delivered. But these mainly work as parallel services to traditional shopping in physical supermarkets.

Exhibit 6: Overview of new retail format development

Alibaba Group JD/Tencent Other players

On its own By affiliated retailers On its own By affiliated retailers • Hema • Haiwuhui • 7 Fresh • Super Species • Fresh Ideas • F2 (New Huadu) (JD) (Yonghui) (Bu Bu Gao) Fast & • RT-Fresh • Zhangyu • Hyper-mart • Sp@ce Fresh • RISO (Meituan) (Bubugao) (Tian Hong) Fresh (Hema) supermarket • Lianhua Jingxuan (Lianhua & Bailian) • Bingo Box

• Auchan Minute JD unmanned store • Bingo Box (Auchan) • Xingbianli • Suning Biu (Suning) Unmanned retail

Source: Analyst reports, Company annual report, Oliver Wyman analysis

At Alibaba’s Hema stores, customers don’t have to go to checkout counters; they can pay by smartphone. Many don’t take their purchases with them; the store sends a delivery van. And some don’t even want all their food at home; supermarket staff members cook some of it for eating in the store.

Exhibit 7: Key features of new “O2O” stores – Hema example

ASSORTMENT AND STORE INSTORE CHECK PRODUCT SETUP EXPERIENCE OUT DISPLAY

1. WELL PACKED HIGH 2. BASKETS ON THE 3. INSTORE DINING 4. HEMA APP TO CHECK QUALITY FRESH FLYING RAIL OUT AND ALIPAY TO PAY PRODUCTS • Get assured that products • Items picked from the • Buy high quality sea food • Get all purchase histories are kept fresh and good store and put on a flying with low price through App quality even with rail to get it delivered to • Enjoy in-store dining • Facilitate next purchase your home within 30 mins packaging together with grocery online if customers want • Gradually get used to it • Feel comfortable and shopping to buy same products once customers build convinced that the future trust with Hema online order enjoy the same product quality as in o ine stores

Source: Oliver Wyman analysis

Copyright © 2018 Oliver Wyman 6 Hema stores aim to give shoppers the best of both worlds: the chance to see food before purchase combined with online shopping’s detailed product information, quick payment, and home delivery: To ensure customers get their food fresh, it arrives at their homes within 30 minutes. JD is experimenting with unmanned stores, uses mirrors, cameras, and smart shopping carts to see which products customers are looking at and taking from shelves. Then the store can provide them with information – and check what they’re walking out with.

More generally, this kind of model will often feature in-house apps, digital price tags, self- service checkouts, and automated shopping carts. In the background will be a double-duty logistics hub that serves both the physical store and deliveries from O2O orders, whether placed online in in-store.

Early signs indicate that O2O retail will go beyond an interesting experiment and significantly change the retail landscape. Hema stores are already attracting young, wealthy, tech-savvy shoppers, a coveted group. They increasingly trust the Hema brand and are more willing to buy fresh food online.

Exhibit 8: Profile of Hema shoppers

Hema shoppers are younger Hema shoppers have higher Hema Shoppers show more than other consumers income level than other interest in online shopping for consumers FMCG products

AGE MIX INCOME MIX ONLINE SHOPPING FMCG ONLY WHICH AGE GROUP DO YOU WHAT IS YOUR MONTHLY HOUSE DO YOU HAVE EXPERIENCE BELONG TO? HOLD INCOME? SHOPPING ONLINE FOR FMCG IN RMB AFTER TAX IN RMB PRODUCTS? IN RMB 100% 4% 5% 8% 13% 19% 80% 31% 41% 38% 34% 60% 45% 50%

40% 34% 69% 62% 20% 54% 11% 37% 19% 19% 0% 6% Hema Other Hema Other Hema Other shoppers1 shoppers2 shoppers shoppers2 shoppers shoppers2

30 and below 31-40 5,000 and below 5,000 - 9,999 Yes No 41-50 51 and above 10,000 - 19,999 20,000 - and above

1. Incl. all shoppers w/different shopping frequency in Hema | 2. Refer to those consumers who are aware of these new concept stores in the catchment, but never visited it Source: Consumer survey (N=656,Oct 26-Nov 1, 2017), Oliver Wyman analysis

Copyright © 2018 Oliver Wyman 7 We estimate that O2O – that is, sales via the app for home delivery, rather than products checked out in the traditional way – contributes as much as 60 percent of Hema revenues. Though stores with O2O features have been expensive to set up and their initial running costs are high, the O2O contribution has boosted productivity, thus keeping losses marginal. With further maturity and greater scale, they should soon be able to break even. We believe there is potential for at least 1,000 stores in prime locations in major cities with total revenues of 200 billion yuan.

Exhibit 9: P&L estimate of a Hema store A MATURE STANDARD HEMA STORE AT 4,000 SQM AS % OF STORE REVENUE

25 23-24 5

20 3-5

15 c.4

10 c.3 5-7 5

c.-3% 0 3-4 (on avg.)

-5 Gross Markdown Store In-store Home Logistics Other Operating margin rental overhead delivery profit overhead

Source: Store visits, Primary research, Research reports, Oliver Wyman analysis

The second major strategic play consists of partnerships between online stores and large, traditional supermarkets. Big-box retailers have tried their own O2O and online shopping services in the past. Hypermarket chain RT-mart launched B2C online platform Feiniu.com in 2014, while Carrefour China tried a similar system a year later in Shanghai. But these and other initiatives have failed.

One reason for such failures is that traditional retailers lack distribution capabilities of their own: Fresh food typically requires 30-minute delivery, which is only possible with a logistics operation that is complex, sophisticated, and large-scale. Another is that they do not naturally generate O2O traffic. This is something that internet and e-commerce companies do through their contact at multiple touch points in customers’ daily lives, such as payment services, social media, and e-commerce purchases. So, traditional retailers have little option but to join one of the tech empires.

A number of alliances have been announced in the past few years. The most recent came in January 2018, when Tencent and YongHui Superstores agreed to take a stake in Carrefour China, as part of a plan to work on smart retail, mobile payments, and data analysis.

Exhibit 10: Key M&A/partnership deals in China grocery retail

August May November JD acquired 10% stake in Ali acquired 18% public shares Ali invested 2.9 billion USD in Yonghui and formed strategic of Lianhua supermarket and Sun Art Retail Group and partnership became 2nd largest shareholder formed strategic partnership

JD, Yonghui Alibaba, LianHua Alibaba, Sun Art

21 21 21 21 21 Today

March June – December January Tencent invested 214 million Walmart bought c.10% of Tencent and Yonghui agreed to USD to become 3rd largest JD public shares and became take a stake in Carrefour China shareholder of JD at that time 3rd largest shareholder of business JD at that time JD, Tencent Tencent, YongHui, Carrefour Walmart, JD

November Ali acquired 32% shares of Sanjiang Group – the largest grocery chain in Zhejiang

Alibaba, SanJiang

Source: Oliver Wyman analysis

Copyright © 2018 Oliver Wyman 9 These partnerships show early signs of success thanks to complementary strengths, as technology from the online retailers helps the brick-and-mortar stores generate incremental revenue. For example, Alibaba installed shelves from its Tmall Supermarket online grocery service in RT-mart branches and started to offer one-hour home delivery for products on these shelves. Next, Alibaba is likely to help RT-mart optimize its in-store O2O infrastructure through an improved app, greater integration with backend, traffic help from Taobao and TMall, and support for delivery. In turn, RT-mart could strengthen Alibaba’s grocery supplier management and store operation capabilities. It could also provide valuable data to Alibaba on customers’ buying habits.

Exhibit 11: O2O business contribution in major grocery retailers % OF ORDERS/PURCHASES PER DAY1

Level of change

W/o eCommerce W/ eCommerce partner W/ eCommerce partner partner but no store upgrade and store upgrade 100 c. 1 <5 5-10 10-15 10-15 80

40 c.99 >95 90-95 85-90 c.85

20 O2O

0 In-store Carrefour Walmart Sanjiang1 Super RT-mart3 (before recent Species2 acquisition)

O2O order # c.50 c.100 150-200 c.300 c.800 per day

Format Hyper Hyper Super Super Hyper

Ecommerce None JD Alibaba JD Alibaba Partner O2O Carrefour/ JD Daojia Meituan Yonghui/ RT-mart/ platforms Meituan mainly mainly JD Daojia Meituan

1. Not all stores operate O2O | 2. The online order # only accounts for c.5% in Yonghui Bravo Luban Rd. Store in Shanghai | 3. A new format store located in Yangpu, Shanghai Source: Primary research, Store visits, Desktop research, Oliver Wyman analysis

Walmart has a strategic partnership with JD which is using its O2O unit JD Daojia as the service platform for more than 150 Walmart stores in order to attract online traffic. Walmart is currently planning to upgrade its stores in China to support O2O services, for example by adding picking areas in store warehouses.

The third strategic play is to reinvent small, family stores. Traditional stores still account for half the sales of fast-moving consumer goods in China, much of them going through the more than 7 million family-run stores that dominate retail outside big cities. Since early 2017, JD and Alibaba have been converting these into franchises. These stores are rebranded under the Tmall/JD umbrella and offer new services, such as bill-paying. In addition, each store is unique in its product offerings, as store owners receive data-based curation advice so that they stock the optimal product selection based on its neighborhood: infant milk in a neighborhood with lots of babies and pet supplies if many residents keep dogs or cats.

Stores’ procurement processes also improve dramatically. Small stores have traditionally been served by a network of multi-layered distributors and wholesalers, which often come with troublesome requirements such as minimum purchase quantities. The two e-commerce giants have developed ordering systems that store owners can operate on their martphones: Alibaba’s Ling Shou Tong (LST) system and JD’s Xin Tong Lu (XTL). Goods arrive from centralized warehouses in less than three days and often on the day the order is placed – in contrast to delays of weeks with traditional wholesalers. The scale of the alliances gives them leverage over the product brands, resulting in better margins both for the stores and for JD and Alibaba.

Exhibit 12: Disruption of traditional distribution model with B2B ordering tools

Brands

Tier 1 distributors

B2B ordering tools (mainly Less in # Ali and JD and layer ecosystem) JD Xintonglu, Wholesalers/ Ali LST low tier distributors (gradually phase out)

Chained retailers Independent retailers

Source: Oliver Wyman analysis

DIGITAL SELF OPERATED RESELLER: JD XIN TONG LU DIGITAL PLATFORM: ALIBABA LING SHOU TONG

Regardless where inventory is, brands own the inventory Deliver Brands’ product via warehouse 3 brands own warehouse Very small proportion of the business for now 3 3

Deliver Sell products Deliver products and send product via Small JD’s products to Brands Small Internet B2B Alibaba’s Brands/ retailers warehouse warehouse retailers players’ warehouse distributors warehouse

Arrange Place order delivery Place order Inform 1 2 1 2 brands of the order details

JD Alibaba Information flow Product flow

MAJOR DIFFERENCE OF TWO MODELS Stock ownership JD Brands (working capital management) Level of transaction visibility Mid-depending on JD’ willingness High to brands to share information Decision power of assortment JD to decide Brands to decide and pricing

Source: Primary Research, Oliver Wyman analysis

Tmall was planning on 10,000 such franchises in 2017, while JD has said it is aiming for one million by 2021. In addition to the customer data and insights they can capture from these expansions, Alibaba and JD are likely to dominate the growing market for ordering systems, which could be worth around 400 billion yuan over the next five years.

Exhibit 14: Number of registered shops JD XIN TONG LU ALIBABA LING SHOU TONG IN MM 0.8 0.7 0.5 0.4 0.2 0.1 0 2016 2017 2016 2017

Source: Oliver Wyman analysis

As O2O becomes the new normal in retail, the two alliances will act as both players in and facilitators of these new models. Traditional retailers may start to test dark stores in selected regions, and even the smallest stores are using the giants’ ordering systems.

To facilitate these combinations of e-commerce and traditional retail, a wave of acquisitions and partnerships has taken place over the past four years. Alibaba has made strategic investments totaling $21 billion in retail alone in just the past two years. The two empires already account for around a tenth of grocery retail, and these plays will attract more consumers through different activities and channels. Their share of grocery shopping could increase to around 30 percent over the next five years, when it could be worth around 4,000 billion yuan in gross merchandise value.

Exhibit 15: GMV projection in the long-term (FMCG) IN BN RMB

Alibaba Group JD/Tencent

e-Commerce platforms2 c.1,800 in GMV c.500 in GMV (FMCG) Taobao.com, Tmall.com JD

“New concept” c.1,000 in GMV c.300 in GMV 3 Hema, Sun Art, New Huadu, Bailian, Yonghui Superstores, 7 Fresh, + O2O retailers Sanjiang Walmart, Carrefour

B2B initiatives c.200 in GMV c.200 in GMV + Ali LST JD Xintonglu

= Total GMV c.3,000 c.1,000

1. 5 years’ projection; for the GMV of Hema, Ali LST, JD XTL, “theoretical” full potential is used for this calculation | 2. Ali current FMCG GMV is c.410 bn, JD current FMCG GMV is c.100 bn; assume c.30% CAGR for both players in FMCG categories in the next five years; for JD, YHD GMV is excluded as it remains a very small proportion (<5%) of JD’s FMCG GMV and is likely to shrink over the years | 3. Grocery retail only; for Ali system, assume 40% stores will be turned into Hema stores; rest of the offline GMV may grow at the same rate of RT Mart (4%); in addition, all stores have c.50% sales uplift from O2O Source: Analyst reports, Oliver Wyman analysis

Independent supermarkets and hypermarkets will find the new environment hard. They typically operate under franchise models that are ineffective due to a lack of centralized control over store operations and products. Survival will call for drastic change, but we believe this is unlikely under their current setup. Most already operate with thin or negative margins and may not have sufficient funds to invest.

Some leading convenience stores should be able to survive on their own in the short term. 7-11 and Lawson, for instance, will continue to benefit from impulse buying. Moreover, they still have room for expansion to meet unfulfilled demand in lower-tier cities. But over the long term, growth will stagnate even in these convenience stores, and they will come under threat from the revival of family-run stores under the JD and Alibaba franchise networks.

Copyright © 2018 Oliver Wyman 13 So, retailers need to plan for how to function in a world dominated by the two empires. The first step is to build a clear plan for strategic alliances that leverage the empires’ tools and strengths. These include online traffic resources, technology capabilities that make better use of physical retailers’ customer transaction data to inform buying and merchandising decisions, and the integration of online and offline aspects of their business. In the case of sub-scale smaller stores and chains that are rapidly losing their ability to compete, the online platforms may prove to be of help in areas where physical hypermarkets traditionally had an advantage, such as product assortment, procurement, and supply chain management. However, if a store is not be viable even after these potential improvements, its owners should consider switching to another business model, reducing size, or simply shutting down.

Brands, too, need to figure out the best ways to engage the new tech empires. Just as anchor tenants in malls get preferential treatment thanks to their role in attracting shoppers, brands should establish themselves as part of store networks’ core propositions, so that they benefit from prominent display and favorable financial terms. They should work with the tech giants to make distribution more efficient, while also maintaining relationships with other distributors – if these survive – to avoid being completely dependent on the e-commerce giants.

It is inevitable that the shape and future of the supermarket and hypermarket industry will be strongly influenced by the tech empires. To survive and thrive, incumbent retailers need to find ways to partner or co-exist.

Copyright © 2018 Oliver Wyman All rights reserved. This report may not be reproduced or redistributed, in whole or in part, without the written permission of Oliver Wyman and Oliver Wyman accepts no liability whatsoever for the actions of third parties in this respect. The information and opinions in this report were prepared by Oliver Wyman. This report is not investment advice and should not be relied on for such advice or as a substitute for consultation with professional accountants, tax, legal or financial advisors. Oliver Wyman has made every effort to use reliable, up-to-date and comprehensive information and analysis, but all information is provided without warranty of any kind, express or implied. Oliver Wyman disclaims any responsibility to update the information or conclusions in this report. Oliver Wyman accepts no liability for any loss arising from any action taken or refrained from as a result of information contained in this report or any reports or sources of information referred to herein, or for any consequential, special or similar damages even if advised of the possibility of such damages. The report is not an offer to buy or sell securities or a solicitation of an offer to buy or sell securities. This report may not be sold without the written consent of Oliver Wyman. 14 ABOUT OLIVER WYMAN

Oliver Wyman is a global leader in management consulting that combines deep industry knowledge with specialized expertise in strategy, operations, risk management, and organization transformation. Oliver Wyman’s global Operations Practice specializes in end-to-end operations transformation capabilities to address costs, risks, efficiency and effectiveness. Our global team offers a comprehensive and expert set of functional capabilities and high-impact solutions to address the key issues faced by Chief Operating Officers and Chief Procurement Officers across industries. In the Distribution and Wholesale practice, we draw on unrivaled customer and strategic insight and state-of-the-art analytical techniques to deliver better results for our clients. We understand what it takes to win in distribution and wholesale: an obsession with attracting, serving, and growing customers, constant dedication to operational excellence, and a relentless drive to improve capabilities. We have a track record of helping clients win in this environment, creating real competitive advantage and driving significant growth. We believe our hands-on approach to making change happen is truly unique – and over the last 25 years, we’ve built our business by helping distributors and wholesalers build theirs. Oliver Wyman is a strategic advisor to the NAW and sponsors a number of NAW roundtable events for companies with revenues $1 BN+. www.oliverwyman.com

ABOUT JANCHOR

Established in 2009, Janchor Partners takes a long-term industrialist mindset in investing in companies that have superior business models, favorable growth prospects and the potential to take advantage of long-term positive structural dynamics of Asia countries and economies. Janchor Partners’ ability to invest for the long-term is strengthened by its investment partners, comprising high quality global institutional investors including family offices, university endowments, foundations and pension funds, who commit their capital to Janchor Partners for multi-year periods. This in turn enables Janchor Partners to build strong and meaningful relationships with its investee companies. www.janchorpartners.com

AUTHORS

WAI-CHAN CHAN JOHN HO Global Consumer Goods Practice Leader Janchor Oliver Wyman [email protected] [email protected] +852 3665 8823 +852 2201 1702 SHEN LI RICHARD MCKENZIE Janchor Partner, Oliver Wyman [email protected] Retail & Consumer Goods +852 3665 8823 [email protected] +852 2201 1703 YUBO GONG Janchor JAMES YANG [email protected] Principal, Oliver Wyman +852 3665 8823 Retail & Consumer Goods [email protected] +852 2201 1715