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Walking on the streets of Shanghai, you will often come across a group of small shops that are keen on "combining". They include street cafes that transform into urban bars when night falls, cashmere stores that sell seasonal fruits in the hot summer, and tobacco and alcohol stores that sell breakfast pancakes while selling sports lottery tickets.

In Shanghai, where every inch of land is valuable, flexibility and adaptability are very important for long-term operation. In the ever-changing market, some small shops have responded by "fighting", which has not only achieved cost reduction and efficiency improvement, but also found a way to survive.

Small shops come up with new ideas

As summer approaches, the "Xiao Shi Cashmere" store located on Huangjiaque Road, Huangpu District, Shanghai, begins to transform rapidly.

The owner, Shi Lifang, carefully packed up the cashmere clothing in the store to make room for the watermelon vendor. Overnight, the store with the sign "Xiao Shi Cashmere" became a watermelon specialty store.

In Shanghai, small shops like "Xiao Shi Cashmere" that are good at "changing" are not uncommon.

They use the flexibility and wisdom of "combining" to cope with the ever-changing market challenges. The simple word "combining" can be used in many different ways - there are "time combining" according to seasons or morning and evening, and "space combining" by dividing a store into multiple parts.

"Xiao Shi Cashmere" is a typical example of "time competition" divided by seasons. Every summer is the off-season for cashmere product sales. For "Xiao Shi Cashmere", it is difficult to maintain a balance between income and expenditure, let alone profit, in the summer. The same is true for watermelon vendors who only do business in the summer. After considering the seasonal characteristics of their own business, Shi Lifang and the watermelon vendors "hit it off". From May to August every year, the watermelon vendors will rent the shop of "Xiao Shi Cashmere" to sell watermelons. When the summer is over, Shi Lifang will take over "Xiao Shi Cashmere" again and continue the cashmere business.

The nearby "Xiaoqin Cashmere" is also well versed in the art of "patchwork". However, in summer, "Xiaoqin Cashmere" sells cool mats and sandals. Located in a residential community, it has been doing business with regular customers for many years. The owner only needs to post a note "processing cool mats" on the original store sign, and the cashmere store can be "transformed in a second".

Another mode of "time competition" is "morning and evening competition". The most typical example is the beverage shops that combine "morning C (coffee) and evening A (alcohol)".

In April 2019, the well-known coffee chain Starbucks opened its first "Starbucks Reserve Coffee & Wine Shop" in Shanghai's Bund. Subsequently, more and more coffee shops joined in, opening up a new model of integrating coffee and bars. As the city with the most coffee shops in the world, many coffee shops in Shanghai are also transforming to provide urban residents with a variety of beverage options covering all hours.

In addition to "time competition", some small shops will choose "space competition".

These stores often share a street sign, or two or three stores share the same store. This model is common in business formats that do not require high space, such as Xiao Cai's repair shop on Taikang Road and the online celebrity beverage store next door. Stores with similar target customers and complementary needs often become "partners", such as chain coffee brands and real estate agencies sharing offline stores.

Xu Zizhang, who once opened a store on Weihai Road in Shanghai, has a lot of experience in this regard. In the summer of 2023, Xu Zizhang took a fancy to a store on Weihai Road in Huangpu District. Because he wanted to try to operate an offline steamed bun shop and an offline coffee shop, after weighing the operating costs, he simply "merged" the two stores into one.

However, it is not easy to do it in practice. "I do franchise business, so I need to discuss with the two franchisees in advance, explain to the landlord that I want to open two stores at the same address, and then consult with the regulatory authorities on how to list the two stores on one business license. It took almost a month to complete these procedures," said Xu Zizhang.

In order to spread the cost, Xu Zizhang put one-third of the rent on the coffee shop and the rest on the steamed buns shop. After the shop opened, nearby office workers often came to the shop on weekday mornings to buy a cup of coffee and a steamed bun, using the combination of Chinese and Western "breakfast CP" to ignite a day's work state.

Behind “building” is “struggle”

Located in a busy street, Xiao Cai's repair shop may not look impressive, but it has always been doing good business. Often, as soon as a customer leaves, a new customer comes in, and the 5-square-meter shop is packed.

Seven years ago, Xiao Cai's repair shop had a "build-to-order" neighbor. In just a few years, the neighbor changed from a coffee shop, a clothing store, a milk tea shop to the current yogurt shop, but Xiao Cai remained Xiao Cai.

"The market changes too fast. If you want to survive in a big city, you have to use your brain." The owner Xiao Cai said that Xiao Cai's repair shop was opened by his father around 1988. In order to keep up with the market changes, they have been working hard to keep up with the times. "From repairing lighters and making keys at the beginning, to self-learning to repair electric kettles, televisions and other home appliances, and later learning to repair watches and clocks, we try our best to keep up with the market demand. In recent years, I have expanded the watch consignment business for the store." Xiao Cai said while introducing the watch display cabinets on the wall of the store, "Doing business means knowing how to adapt. If we only knew how to repair lighters, we would have been eliminated long ago."

In recent years, the rapid development of online shopping, rising rents and high operating costs have brought considerable operating pressure to street shops. It can be seen that more and more small shops are beginning to expand new businesses, try cross-border cooperation, and use innovative operations to reduce costs and increase efficiency, striving to "fight" for a place in the commercial landscape of big cities.

Xinyi Grocery Store on Huangjiaque Road in Huangpu District, Shanghai, is such a small store. Although it only covers an area of ​​more than 10 square meters, it sells a variety of products including grain pancakes, flowers, sports lottery, milk, tobacco, alcohol and beverages, and is considered a master of the "building block world".

"At first, we only sold cigarettes, alcohol and flowers. Then the residents asked to buy milk, so we added a milk shed." The proprietress of Xinyi Grocery Store said that the breakfast pancake stand in front of the store was originally run by a couple from another place. "A few years ago, they went back to their hometown to take care of their grandchildren, but the residents kept asking, 'Do you have pancakes for sale?' So I learned how to make them myself and took over the breakfast stand business."

Although the store sells a wide variety of products, there are only two people who can take care of the store. At 5 a.m. every day, the owner of Xinyi Grocery Store and her husband start working non-stop. "Before 5 a.m., my husband will get up to prepare breakfast ingredients. I usually get up at 5 a.m. to take care of the breakfast business, while my husband takes care of other business. After lunch, my husband and I take turns to rest and eat, and we close the store and go home at 10 p.m. The residents nearby all know that our store is basically open all year round."

In the process of keeping up with market changes, the reason for such "hard work" is not only due to external factors such as changes in the market environment, but also to the consideration of maintaining the livelihood of the whole family. The operators of small shops know that only by continuous innovation and hard work can they gain a firm foothold in the fierce market competition.

"I have three children to support, and the youngest is still in junior high school. The rent has increased from 4,000 yuan at the beginning to tens of thousands of yuan now. It is not enough if I only do the tobacco and alcohol business." The boss's wife said, "Although there is a lot of work now, it can guarantee the lives of my family of five, so this little hardship is nothing."

Create space for more small shops

As the "capillaries" and "nerve endings" of the market and consumer ends, small shops are not only the starting point for many individual business owners and micro-business operators to realize their entrepreneurial dreams, but their stable development is the key to maintaining the livelihoods of hundreds of millions of families and is related to the vitality and resilience of my country's economy.

Data released by the State Administration for Market Regulation show that by the end of 2023, there will be 124 million registered individual businesses nationwide, accounting for 67.4% of the total number of business entities, supporting employment for nearly 300 million people. In 2023, 22.582 million new individual businesses will be established nationwide, an increase of 11.4% year-on-year.

"In order to allow small shops to gain a better living space in big cities, we have been exploring how to support the small store economy through policies in recent years," said Guo Tingting, commissioner of the Registration and Filing Office of the Shanghai Administration for Market Regulation.

In order to solve the problem of small and micro business operators having difficulty renting houses, in January 2022, the Shanghai Municipal Market Supervision Bureau issued relevant policies and measures, proposing to "support the development of individual businesses and explore the implementation of a centralized registration model for community service individual businesses." By linking the Party and Mass Service Centers, Neighborhood Exchanges and other community functional carriers in various streets and towns as centralized registration points, individual businesses engaged in residents' life services in the community will be helped to obtain business licenses.

On May 10 this year, the "Shanghai Food Business License and Registration Management Implementation Measures" were also implemented. "We have simplified the original 19 food business items into four categories, including hot food production and sales, cold food production and sales," said Wang Weijuan, deputy director of the Food Business Safety Supervision and Management Department of the Shanghai Municipal Market Supervision Bureau. "This means that small stores can adjust their products according to market changes, have greater flexibility and trial and error space in operation, and facilitate the market demand for small stores to operate in a variety of formats."

Not only that, Shanghai has also released some public welfare spaces, opening the door to people who have entrepreneurial dreams.

On Yuyuan Road, a popular street in Shanghai, Jiangsu Road Subdistrict in Changning District, Shanghai, has transformed a street shop into a "story shop" for young people to "move in with their bags" and practice their offline entrepreneurial ideas. "Opening a shop will inevitably involve various costs such as rent, water, electricity, and labor. The early investment is too heavy for young people who are just starting out. The 'story shop' hopes to provide a 'light' trial and error space for young people to start offline businesses." said Xu Yinlan, the manager of Changning District Shequ Gengxin Construction Center.

As one of the most dynamic consumption regions in my country, small shops in Shanghai are not only a vivid portrayal of the city's fireworks, but are also growing into a "testing ground" for new formats and new economies. The implementation of a series of new business regulations not only provides policy convenience for small and micro business operators, but also provides confidence for business entities to explore mixed operations of various formats and try new consumption models.

Not long ago, Xu Zizhang planned to close the Baozi Coffee Shop on Weihai Road due to the expiration of the contract. "I didn't have much experience in my first business, so I took some detours," Xu Zizhang said with a smile, "but the attempt to compete in the business model was successful. With this experience, I should be able to do better next time I start a business."

Shi Lifang opened a snack bar at the beginning of this year, selling pot stickers and noodles, only a hundred meters away from "Xiao Shi Cashmere". "On the one hand, I want to enrich myself." Shi Lifang said, "On the other hand, I want to open a new store to try other fields."

As the most grassroots and vivid source of vitality in the urban economy, the small store economy is not only a "reservoir" for urban employment, but also constitutes the fireworks of urban life. For small stores that love to "fight", "fighting" is not only about seeking new revenue growth points, but also the unremitting struggle and tenacity of countless small and micro business operators in responding to market changes. Because small stores understand that only those who love to "fight" can win.