A Freshippo store [Photo/Ren Zini (NBD)]

June 4 (NBD) -- Freshippo, backed by e-commerce juggernaut Alibaba, recently announced its first store closure in three years, and this is not a single case.

Meituan's fresh grocery delivery affiliate Ella Supermarkets is downscaling the operations, and Suning's SU FRESH and JD.com's 7FRESH are being questioned over a slowdown in store opening...

All these seem to indicate that the fresh food-focused new retail model is at a point of inflection, and new retail companies are seen seeking growth opportunities in neighborhood marketplaces. 

In field visits to Freshippo outlets in Beijing, National Business Daily (NBD) noticed that large-sized fresh seafood that sets Freshippo apart from other supermalls are now holding less appeal for consumers than before. 

More people who visit Freshippo are choosing budget dishes over seafood meals. "A Boston lobster is now sold for over 100 yuan, much higher than previous price tags, and a meal at the chain would cost more than 300 yuan if some shrimps and small dishes were also ordered," so said a woman who was dining with her child to NBD at a Freshippo store in Beijing. 

But reduced customer traffic doesn't mean the failure of the new retail model. "Large-sized seafood (like Boston lobsters) still has a market, but not as appealing as before," Freshippo CEO Hou Yi noted. 

New retail commerce analyst Yun Yangzi said to NBD that the development of new retail in China is more like an exploration in the depopulated zone, and industry players are facing unknown difficulties and challenges while embracing opportunities. "Closing money-losing stores is normal, not always a bad thing," Yun added. 

Looking for new growth drivers, many new retail companies are tapping deeper into neighborhood marketplaces. 

Freshippo will strongly promote four businesses this year, and one of them is Freshippo Market, which is designed to better serve community residents by offering loose-packed vegetables, pork, eggs and poultry food and adding stalls for freshly-made food products. 

JD.com's 7FRESH will also introduce two new business types in the second half of this year - one targeting communities and the other serving areas where there are many office buildings. Meituan, after shuttering Ella Supermarkets stores in third- and fourth-tier cities, will place an emphasis on vegetable delivery services. 

Email: lansuying@nbd.com.cn