Freshippo Unveils Ambitious Expansion Plan for Fiscal Year 2025
Freshippo, the innovative retail brand under Alibaba Group, has announced its strategic roadmap for fiscal year 2025, which includes plans to open nearly 100 new stores and expand into dozens of additional cities across China. This move underscores the company’s commitment to strengthening its presence in both established and emerging markets.
In an internal letter circulated at the end of 2024, Freshippo CEO Yan Xiaolei revealed that the company had achieved sustained overall profitability over the past nine months, alongside double-digit growth in revenue. Customer numbers surged by more than 50% during this period, reflecting the brand’s growing appeal. Yan also highlighted that nearly half of Freshippo’s stores nationwide underwent significant upgrades in 2024, enhancing the shopping experience for consumers.
The company’s strategy revolves around two core business models: Freshippo’s standard stores, which cater to middle- and high-income consumers, and Freshippo NB stores, which operate as discount outlets targeting budget-conscious shoppers. This dual approach has allowed Freshippo to capture a broader customer base and adapt to diverse market demands.
According to a company report released in late December 2024, Freshippo opened 72 new stores throughout the year, averaging one new store every five days. The brand also expanded into 21 new cities, marking its most aggressive store rollout in the past five years. Notably, one-third of the new stores were established in second- and third-tier cities, as well as county-level markets, which have emerged as key growth areas for the company. By the end of 2024, Freshippo operated nearly 430 stores across 50 cities in China.
Financially, Freshippo reported a total gross merchandise value (GMV) of over 59 billion Chinese yuan (8.15billion)forfiscalyear2024,upfrom55billionyuan(7.60 billion) the previous year. Online transactions accounted for more than 63% of the total GMV, while offline sales saw a modest 2% increase. Additionally, the majority of Freshippo’s self-operated stores that had been open for over a year achieved positive cash flow, signaling the company’s operational efficiency and financial health.
During Alibaba’s fiscal year 2025 meeting, executives praised Freshippo’s robust growth, steady expansion, and impressive profitability. They emphasized that Freshippo has successfully validated its integrated online-offline retail strategy, which combines the convenience of e-commerce with the experiential benefits of physical stores. As a result, Alibaba has confirmed that it has no plans to divest its stake in Freshippo at this time.
Freshippo’s ambitious plans for 2025 reflect its confidence in the resilience of its business model and its ability to capitalize on evolving consumer preferences. By continuing to innovate and expand its footprint, the company aims to solidify its position as a leader in China’s competitive retail landscape.
