New : The Instant Retail in China

Hello, It is Marcus Zhan Director of Project ecommerce GMA…

Today I will explain something “new” to you guys… that I have read from “China Business Intelligence Network News”:

The instant retail industry a trend in China

The rapid development in recent years, becoming one of the important directions for retail digital transformation.

As a new retail format and new consumption model, the market size of China’s instant retail is at the trillion-yuan business

I. Definition of Instant Retail : Instant retail is a retail format that meets local immediate needs by placing orders online
instantly and fulfilling them offline instantly, relying on local retail supply.

There are certain differences between instant retail and traditional e-commerce:

-From the perspective of consumer demand and consumption
decisions: Instant retail involves light decision-making, while e-commerce
involves heavy decision-making for planned consumption.
– From the perspective of product characteristics: Products in instant retail are
mostly high-frequency categories with high standards, while products purchased
via e-commerce are more often low-frequency categories with non-standard
features.
– From the perspective of the inventory model: Instant retail uses distributed,
near-field dynamic inventory, whereas e-commerce uses centralized, long-range
static inventory.
-From the perspective of the fulfillment system: Instant retail involves minute-
level same-city rapid fulfillment, while e-commerce involves 1-3 day cross-city
delivery.

II. Instant Retail Industry Policies

In recent years, the development of China’s instant retail industry has received multi-
dimensional support from national policies.
* The “Notice on Implementing Actions to Boost Digital
Consumption” explicitly encouraged the construction of fulfillment systems such
as front-line warehouses and unmanned delivery for the first time.
* The “Guiding Opinions on Deepening the Development of Smart Cities to
Promote Comprehensive Digital Transformation of Cities” listed instant retail
as a core scenario for new urban digital consumption landmarks.
* The “Retail Industry Innovation and Upgrading Project Implementation
Plan” further proposed the specific path of “coordinated development of in-store
and home delivery.”
* Entering 2025, policies extended further into the depths of the supply chain.
The “Special Action Plan for Accelerating the Development of Digital and
Intelligent Supply Chains” emphasized using digital and intelligent technologies
to connect the consumer and manufacturing ends, promoting “personalized
customization + flexible production.” This marks that instant retail policies have
upgraded from terminal format innovation to the digital reconstruction of the entire
industrial chain.

(Source: Compiled by China Business Industry Research Institute)

III. Current Development Status of the Instant Retail Industry

1. Market Size of Instant Retail
   Instant retail, through online ordering and offline fulfillment, deeply integrates local supply
   and demand and has become a new driver of growth for the retail industry. In recent
   years, China’s instant retail has maintained high-speed growth, with its growth rate
   consistently exceeding the average growth rate of total retail sales of consumer goods.
   According to the “Smart City Series Special Topic: China Instant Retail Industry Chain
   Panorama and Opportunity Insight Special Research Report” released by the China
   Business Industry Research Institute, in 2024, the scale of China’s instant retail reached
   781 billion yuan, a year-on-year increase of 20.15%. In 2025, the scale of China’s instant
   retail exceeded 970 billion yuan, and it is expected to exceed 1.2 trillion yuan in 2026.
   (Data source: Ministry of Commerce, compiled by China Business Industry Research
   Institute)
2. User Scale of Instant Retail
   The “Smart City Series Special Topic: China Instant Retail Industry Chain Panorama and
   Opportunity Insight Special Research Report” released by the China Business Industry
   Research Institute shows that in 2023, the number of active users of China’s instant retail
   was approximately 580 million, a year-on-year increase of 34.88%, accounting for
   53.11% of the netizen population. In 2025, the number of active users of China’s instant
   retail was approximately 730 million. Analysts at the China Business Industry Research
   Institute predict that the number of active retail users in China will reach 810 million in
   2026.
   
3. Age Structure of Instant Retail Consumers
   The younger generation is the main customer group for instant retail. Data shows that in
   China’s instant retail, the 31-45 age group accounts for 55% of consumers, the 18-24 age
   group accounts for 12%, the 25-30 age group accounts for 19%, and the 46+ age group
   accounts for 14%.
   (Data source: China Industry Institute)

1. Product Category Structure of Instant Retail
   Currently, instant retail product categories have covered fresh food, beverages, grains,
   oils, snacks, consumer electronics, personal care, home products, etc., meeting
   residents’ daily life, work, and social needs. Currently, fresh food accounts for the highest
   proportion at 48.2%, while beverages and grains, oils, etc., account for over 10%, at
   15.1% and 14.3% respectively. Snacks, consumer electronics, and personal care
   account for over 5%, at 6.0%, 6.0%, and 5.3% respectively.
   
2. Main Players in Instant Retail
   The industrial chain of instant retail involves four major links: “User – Platform/Self-
   operated – Local Merchant – Delivery.” Depending on the dominant role, it can be divided
   into three main types of players: platform-based players, self-operated players, and
   traditional retail transformers.
   (Source: ecommercechinaagency.com)

Key Enterprises in the Instant Retail Industry

1. Meituan
   Meituan is a technology retail company. On September 20, 2018, Meituan was listed on
   the Hong Kong Stock Exchange. Meituan’s instant retail platform, Meituan Flash Sales,
   relies on its instant delivery capabilities to connect local retail supply and meet
   consumers’ instant needs for “everything delivered to home within 30 minutes.” Meituan

“Flash Sales covers many categories such as supermarkets, convenience stores, fresh
food, fruits, flowers and plants, snacks, beverages, digital appliances, beauty and
personal care, mother and baby toys, daily necessities, clothing, shoes, hats, and pets.
Its business covers nearly 3,000 counties, cities, and districts across the country, with
millions of riders on duty daily. ” ExplainJon Wang Digital Distribution Expert

2. JD.com
The core carriers of  JD.com ‘s instant retail are JD Daojia (open platform) and Hourly
Shopping (JD.com main site entry). The two collaborate to cover two major supply
sources: “third-party merchants” and “JD self-operated products.”
–JD Daojia: An open platform model connecting local merchants and users. JD
Daojia was established in 2015 (later merged with Dada Group) and positioned
as a “local instant retail platform.” It aggregates local merchants such as
supermarkets, convenience stores, fresh food stores, and pharmacies to provide
users with instant delivery services.
-Hourly Shopping: The instant retail entry point on the JD.com main site. In
2021, JD.com upgraded “Hourly Shopping” to a first-level entry on its main site,
integrating JD self-operated products and third-party merchant resources,
focusing on “full-category instant delivery.”
JD.com’s core barriers in instant retail are mainly reflected in three dimensions: supply
chain, logistics, and ecological synergy. On the supply chain side, it builds a
differentiated advantage through a dual supply system: self-operated products and local
merchants. On the logistics side, relying on the efficiency of “warehouse-integrated
distribution,” Dada Now covers over 2,700 counties and districts, with 90% of orders
delivered within 30 minutes. On the ecological side, it accurately caters to the strong
demand of middle- to high-income users in first- and second-tier cities on
the JD.com main site for “quality + timeliness.”

3. Alibaba
   Alibaba’s instant retail business is centered around Ele.me, Taoxianda, Hema, and Tmall
   Supermarket Hourly Delivery. At the same time, relying on the traffic entry points of
   Taobao/Alipay, it forms a three-dimensional layout of “platform + self-operation +
   ecological synergy,” covering multiple categories such as catering, fresh food, daily
   necessities, medicine, and 3C products.
   Alibaba’s core advantage in the instant retail business competition stems from the
   barriers formed by ecological synergy and resource integration: leveraging China’s
   largest e-commerce user base, a complete local life service system covering food
   delivery/in-store/travel, and the Cainiao + Fengniao logistics network, it achieves efficient
   cross-business collaboration; through investments and partnerships, it binds leading
   supermarkets such as RT-Mart, Suning, and Intime, using Taoxianda to seize the first-
   mover advantage in supermarket O2O, strengthening its control over the supply side;
   simultaneously, relying on its technological capabilities in AI algorithms and big data, it
   improves fulfillment efficiency and reduces losses. The combination tmall of these three
   aspects builds a comprehensive competitiveness that is difficult to replicate.
4. Pinduoduo
   Pinduoduo’s instant retail layout starts with “Duoduo Grocery” and gradually extends to
   independent businesses, currently implemented mainly through the following methods:
   – Relying on the localized warehousing and distribution network of “Duoduo
   Grocery.”
   – Open platform model: Connecting with local merchants.
   – Testing proprietary brands and vertical categories.

Pinduoduo’s core advantages in instant retail lie in continuing the main site’s “low-price
mindset” to attract price-sensitive users, relying on its penetration in lower-tier markets
(over 60% of users are in counties and rural areas) to fill gaps in local supply, and
leveraging its supply chain capabilities as the largest agricultural product online platform
to strengthen the differentiation of low-price freshness in the fresh food category through
a short-chain model of “origin – grid warehouse – user.”

5. Douyin (TikTok)
   Douyin’s instant retail business is an important part of its expansion from “content e-
   commerce” to “full-scenario interest e-commerce.” The core is to meet users’ demand for
   “watch and buy immediately, get what you need instantly” through “content种草 + instant
   fulfillment.”
   Douyin stimulates immediate, unplanned consumption through the scenario-based
   display of content种草. Relying on its local life merchant resources and combining LBS +
   user behavior-based precise algorithm recommendations, it forms a differentiated traffic
   and supply advantage of “content + local,” constituting its core barrier in instant retail.
   V. Development Trends in the Instant Retail Industry

Scenario Extension: From “Products” to “Services” in China

Instant retail will expand from physical goods to “products + services,” such as queuing
on behalf of others, home service appointments, and customized flowers, meeting “one-
stop instant needs.”

Full-Chain Digitalization: From “Transaction” to “Operation”
Platforms will provide deeper digital tools to help merchants achieve “online + offline”
omni-channel operation and increase output per store.

Regional Downward Penetration: From “High-Tier” to “Lower-Tier” Cities
With the improvement of logistics networks in lower-tier cities, instant retail will penetrate
county-level markets, focusing on local “small and scattered” supplies such as mom-and-
pop stores and community supermarkets.

Technological Empowerment: Breakthroughs in AI and Unmanned Delivery
AI large models will optimize demand forecasting and inventory management. Unmanned
vehicles and drone delivery are expected to reduce last-mile distribution costs as policies
open up.

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