Chain stores join hands with farmers to reduce impact of virus
By Meng Qingsheng

Fu Xiuying grows two hectares of strawberries at Lujia Town of southwest China's Chengdu, producing about 200 kilograms a day. Almost every day, she'd rush to the nearest bank to save all the money she's earned from selling the red berries.

Fu is happy that she's finally secured a way to sell out her harvest. However, the scenario was quite different back in late January, when the COVID-19 broke out in central China's Wuhan and swept across the country. "Sales of my strawberries were suspended for about 10 days," she told CGTN.

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Disrupted supply chain

Mass farming of strawberries rolled out at Lujia Town back in 2016. Locals invited agricultural experts from east China's Shandong Province to teach them how to cultivate the fruit and make a bumper harvest. To date, the farm has grown to more than 130 hectares, and involves over 1,000 local households.

The sales, by and large, remained unaffected by market factors, over the past few years. But the spread of the COVID-19 has cut demand for strawberries, and strict quarantines meant fewer distribution.

This disrupted supply chain has brought financial losses to local growers. The price per kilo has dropped from 40 yuan during the same period in 2019 to six yuan at the lowest point, less than one U.S. dollar.

"It made me so anxious because that was the most profitable time for strawberries," Fu Xiuying shared with CGTN. She could do nothing as the berries went bad and finally rotted in the patches. Still, the distributors they used to work with could hardly come.

To find a way out, local departments brokered a deal with the Chengdu Hongqi chain – the largest store network in Sichuan Province. That's the first time fruits grown in that locality entered large chain stores.

From farm to store

Each day, trucks from Hongqi Chain went to Lujia Town to collect newly-picked strawberries, which were then sent directly to over 3,000 chain stores. The company offered a price of 24 yuan per kilo to growers, higher than the price farmers would get otherwise. This initiative became a crucial link on the supply chain to ensure a steady income for local farmers.

"We distributed unsold strawberries and vegetables to stores within a short period of time. This helped get growers out of difficulty," Cao Shiru, chairwoman of the Chengdu Hongqi chain said, told CGTN. So far, the company has sold over 50 tons of strawberries, vegetables, and other agricultural produce.

Hongqi uses cloud computing to help allocate resources. Installed at one of its three distribution centers in Chengdu, a gallery on the wall displays each transaction at its stores alongside details like the types of commodities, names of customers, and the frequency of their purchases. It can also alert the management if a particular stock is running low, improving working efficiency.

Cao told CGTN that, as encouraged by local departments, her stores became the only chain operating in the city during an effective lockdown. The company provided 24-hour service to local residents.

Production and marketing

Nationwide, e-commerce companies have put forth alternative ways to repair the disrupted traditional supply chain, and secure a closer connection between production and marketing procedures. 

Since launching its Rural Support Program on February 6, Alibaba Group has opened its Taobao Live platform to farmers for free. Some 15 million kilograms of products were sold during the first three days of live-streaming. The channel has been promoting farm-fresh produce daily ever since.

Cainiao, the group's logistics arm, opened a channel for the delivery of agricultural produce. Orders placed via Taobao live streams are shipped within 72 hours to over 50 major cities using Cainiao's network. Since its launch, an estimated 18,000 tons of agricultural products have been sold under this initiative.

Likewise, Pinduoduo has launched a "Help the Farmers" channel to allow customers to buy directly from producers in poor areas. It said that was intended to support suppliers that have trouble getting shipment to traditional markets due to anti-virus measures. The company promised 500 million yuan (70 million U.S. dollars) to subsidize purchases.

These efforts are welcomed by local officials. Guo Wenqing from the Urban-Rural Integration Office of Chengdu High-tech Zone reckons that, "We should prioritize building a closer connection between production and marketing, and streamline the procedures to reduce unnecessary costs, so that we can meet farmers' needs and keep prices stable."

At a press conference by China's State Council on February 18, agricultural officials proposed several measures to cope with disrupted supply chain, including an increased responsibility on mayors to solve impending problems hindering the sales of agri-food, a mass purchasing of produce by wholesale markets and companies, and the launching of more online platforms to facilitate agri-food transactions.

As the bulk of strawberries go to chain stores, Fu Xiuying selects some of the best to sell on the WeChat messaging app for a higher price. She's sold the goods to places outside of Sichuan Province, like Guangdong, Zhejiang and Chongqing, via delivery services.

Fu has decided to expand her strawberry patches later this year, and she also wants to keep working with Chengdu Hongqi as it ensures a stable supply chain that has been largely unaffected by the ongoing COVID-19 epidemic.