Annual Report Observation 丨 The four major pharmacies all achieved revenues of over 10 billion last year

In 2019, Dashenlin, Yixintang, Yifeng Pharmacy, and the top four listed pharmacy chains all entered the ranks of 10 billion. Both revenue and net profit increased, and the total number of stores increased to varying degrees.In terms of revenue, Yifeng Pharmacy is the highest in the long run, at 48.66%; followed by Dashenlin, the common people, and one heart, the revenue extension for the ten years was 25.76%, 23.15%, 14.20%.In terms of net profit, the growth rate accelerated by Dashen Forest, which increased by 32 per year.17%; then Yifeng pharmacy, ordinary people, one hearted, 30 respectively.58%, 16.94%, 15.90%.Driven by industrial policies, capital intervention, and large-scale competition, the industry’s concentration continued to increase.According to data from the State Drug Administration, as of November 2018, the total number of retail pharmacies nationwide reached 48.90,000, including 25 pharmacy chains.The chain rate of 50,000 pharmacies nationwide increased from 50 last year.44% increased to 52.15%.The market share of the top 100 comprehensively competitive chain enterprises reached 42.9%, the scale of the pharmaceutical retail market and industry concentration continue to increase.In 2019, the merger and acquisition speed of the four major pharmacies has slowed down.Yifeng Pharmacy launched 12 merger and acquisition investment businesses in 2019, with 381 mergers and acquisitions, which is not less than the scale of nearly 1,000 stores in 2018.There were 13 mergers and acquisitions in Dashenlin in 2019, involving 560 stores.The common people completed 13 mergers and acquisitions in 2019, involving 287 stores.Yixintang, the largest group, did not have any asset or equity acquisition in 2019.As of now, there are no nationwide chain pharmacy giants. The four major listed chain pharmacies all have profound regional characteristics, and they have expanded their regions on the basis of deep cultivation of their own sites.For example, Dashenlin ‘s development strategy is “deep cultivation in southern China and live in the country”. In 2019, Jiangsu, Shaanxi, Heilongjiang and other provinces will be added with 718 new stores.Yixintang’s annual report also pointed out that the company’s key development areas are in the Southwest and South China regions, while taking into account the development of stores in North China.In the next three years, the Sichuan-Chongqing area will be the company’s first important expansion area, and Guangxi and Hainan will be the second expansion area.Judging from the distribution of stores, the core area of the people is mainly concentrated in Central China and East China. The number of directly-operated stores is more than 1,000, while the southern and northern areas are relatively weak, with only a few hundred stores.The common people said that they will achieve rapid national expansion through the “four-wheel carriage” of “self-building, mergers, acquisitions, alliances, and joining”.The strategy of Yifeng Pharmacy is “regional focus, steady expansion”, which has achieved leading market competitive advantages in central and southern China, east China, and northeast China., Nine provinces and cities in Beijing.”Chainization is inevitable, but the expansion of listed companies must be orderly. After rapid expansion in the early stage, quality must be pursued. Blind and disorderly expansion cannot bring profits to the company.”” For the phenomenon of the slowdown of listed companies’ mergers and acquisitions in 2019, Qian Lizheng, founder of the Chinese Medicine People’s Club, pointed out that expanding the scale is the biggest demand for listed chain pharmacies. The problem after rapid expansion is how to stabilize the stores, and the listed companies need to see “”Transcript”, how to let the new store of M & A survive and guarantee profits, is a problem that listed companies need to think about.Therefore, while the rapid expansion of listed companies requires a large number of management talents to join, otherwise the chaotic store management will cause the company’s performance to decline.Editor Yue Qingxiu proofreading Wang Xin drawing Li Shiyang