(Yicai) March 13 -- Chinese e-commerce giant JD.Com plans to add 20 new fresh food warehouse stores under its supermarket chain 7Fresh in Tianjin by the end of June, according to a source.

The move aims to enhance 7Fresh’s fresh food supply and service capabilities amid the fierce competition in the instant retail sector, a manager from the company told Yicai yesterday.

The instant retail sector is more and more crowded, with established market players such as Sam’s Club, Alibaba Group Holding’s Freshippo, and Meituan’s Xiaoxiang Supermarket seizing most of the market share. In addition, Walmart China and Meituan announced in December a partnership to bring all Walmart stores in China to Meituan’s delivery platform.

7Fresh’s warehouse supermarkets integrate storage and retail functions and leverage JD.Com’s robust supply chain and logistics network to provide residents with high-quality fresh products and delivery services within 30 minutes. Some products are about 10 percent cheaper at 7Fresh than its rivals.

Given Tianjin’s limited instant delivery capabilities, JD.Com’s decision reflects the city’s growing importance as a key hub for the company’s instant retail business, Pan Helin, a member of the information and communication economy expert committee under the Ministry of Industry and Information Technology, told Yicai.

JD.Com is expected to further expand its presence in Tianjin, Pan predicted.

The self-operated front warehouse model adopted by 7Fresh allows dense urban-level deployment, Bailian Consulting’s founder Zhuang Shuai said. It not only meets consumer demand for fast fresh food delivery but also boosts profit margins by expanding product categories and developing private-label brands, he explained.

However, Zhuang warned that competition in first-tier cities remains intense in the front warehouse business. Transitioning from large central warehouses to localized front warehouses will challenge JD.Com in areas such as site selection, inventory management, and operational efficiency, he noted.

Editor: Futura Costaglione