Hema achieved annual profitability for the first time and will open nearly 100 large "Hema Fresh" stores | Exclusive from 36Kr

Text by | Peng Qian

Edited by | Qiao Qian, Yang Xuan

36Kr exclusively learned that by March 2025, Hema achieved its first annual profit (from April 2024 to March 2025).

Meanwhile, there has been a change in the senior management of "Hema Fresh", the most important business under Hema. According to 36Kr, the current business structure of Hema Fresh is divided into four lines, namely operation (offline stores in various regions), online operation, procurement, and logistics supply chain. The person - in - charge of each line reports directly to Hema's CEO, Yan Xiaolei (nickname: Baihe).

Hema's achievement of profitability is inseparable from a series of reforms carried out by the new CEO.

In March 2024, Yan Xiaolei, the former chief financial officer of Hema, took over as the CEO of Hema. At the end of last year, Yan Xiaolei clearly stated in an internal letter that Hema would focus on the strategic development of two core business formats: the large - scale "Hema Fresh" stores and the "Hema NB" supermarkets. The former is responsible for rapidly replicating the mature model, while the latter focuses on community - based services, forming complementary advantages. One of Hema's former "three - horse carriages" - the X Membership Store is still shrinking: at the end of March this year, Hema X Membership Store continued to close three stores in Shanghai, leaving only five stores nationwide.

Under her leadership, Hema has resumed its expansion. In the past year, Hema opened 72 new stores, and the number of large - scale Hema Fresh stores reached 430, exceeding the total number of Walmart stores in China. According to 36Kr, in early March this year, Hema disclosed its strategic plan for the fiscal year 2025 internally. In the new fiscal year, it will still focus on the expansion of the Hema Fresh format, planning to open nearly 100 new stores and enter dozens of new cities.

There are mainly two directions for Hema to open new stores. On the one hand, the new stores are located in more lower - tier areas, with one - third of them opened in second - and third - tier cities and county - level areas. Data disclosed by Hema shows that in 2024, Hema entered 21 cities and regions. Just in the Yangtze River Delta region, it entered six county - level areas including Changshu, Tongxiang, Yiwu, Zhuji, Deqing, and Zhangjiagang.

On the other hand, Hema plans to open more stores in northern cities. Previously, most of Hema's stores were concentrated in the Yangtze River Delta and Pearl River Delta regions, with more than 60 stores in its home base, Shanghai. According to 36Kr, Hema will open a new store in Tianjin in May, which may be an important node for Hema's expansion in the north.

To improve the user experience, Hema has renovated nearly half of its Hema Fresh stores across the country and upgraded them through algorithms. Since last year, Hema has restarted its front - end warehouses, forming a "1 + N" model with the large - scale Hema Fresh stores. At that time, Hema revealed that the pilot use of front - end warehouses was to densify the service radius and provide delivery services within 30 minutes within a 3 - kilometer range for more users. The front - end warehouse model is also an important layout that has driven the rapid development of Sam's Club in China.

In terms of the supply chain and products, Hema conducts differentiated product development for different business formats. Now, Hema Fresh and Hema NB have completely different product systems. Hema is also increasing the construction of its own brands, especially the health - oriented brand "Hebubu". Currently, the proportion of Hema's own - brand products is about 35%.

With all the data showing positive trends, Hema, which has restarted its expansion, has set a larger growth target. In the internal letter at the end of last year, Yan Xiaolei made a commitment: to make Hema reach the scale of 100 billion yuan and become the No. 1 retail brand in China in the future.

Hema was one of the pioneers of instant retail. After going through some setbacks, it has regained its growth momentum. Zhao Jiayu, a co - founder of Hema who joined at the beginning of its establishment, retired recently.

To date, the competition in the supermarket industry remains fierce. Foreign giants such as Sam's Club and Aldi are very popular, and domestic leader Yonghui is actively making adjustments. Competitors like Fat Donglai, Dingdong Maicai, Xiaoxiang Supermarket, and Pupu Supermarket are accelerating their efforts to divide the market. Under such intense market competition, Hema still faces growth pressure. Presenting the report card of its first annual profit may give Alibaba Group more confidence and is also a crucial starting point for its "rebirth".