Many consumers have noticed that snack outlets on the street offer products at significantly lower prices than traditional supermarkets—for example, a pack of cookies that costs 5 yuan in a supermarket might be available for just 3.5 yuan at a snack store. How is such low pricing possible? Is it due to differences in product quality? In fact, this pricing strategy is underpinned by a well-established business model.

The low-price strategy of bulk snack stores stems primarily from three key factors. First is the direct-sourcing model that eliminates intermediaries. In traditional supermarkets, snacks typically pass through multiple stages—agents, wholesalers, and other middlemen—each of which adds a markup. By contrast, bulk snack stores leverage their massive purchasing volumes to deal directly with manufacturers, bypassing these intermediate links and securing much lower wholesale prices. Data show that in 2024, bulk snack stores became the largest channel for snack sales in China, accounting for over 40% of the market. This enormous procurement scale gives them exceptional bargaining power. -1

Second, there is a combined strategy of “brand-driven traffic generation plus private-label profitability.” In bulk snack stores, products are typically divided into three categories. Top-tier, well-known brand items are used to attract foot traffic; these items usually have gross margins below 10%, sometimes even close to zero, with the goal of creating the perception that “this store offers very low prices.” Specialty snack brands have gross margins between 10% and 15%. Meanwhile, it is the private-label products or loose snacks that truly drive store profitability, with sales gross margins often exceeding 30%. By employing this mix, snack stores can maintain a low-price image while ensuring solid profitability. -1

Third, retailers sell products in “exclusive specifications.” Keen consumers may notice that a certain brand of cookies sold in snack shops looks almost identical to the same brand sold in supermarkets—yet the net content is noticeably smaller. For example, Oreo cookies are 97 grams in supermarkets but only 77.6 grams in snack shops; Pocky from Orion is 104 grams in supermarkets but 88 grams in snack shops. This practice of offering the same product in different package sizes creates the illusion that the item is “cheaper” when consumers compare unit prices. Because the visual differences are minimal, many shoppers fail to spot the discrepancy in weight at the point of purchase. -1

It is important to note that low price does not necessarily equate to low quality; however, consumers should still exercise rationality when making purchases. When selecting products, it is advisable to focus on the net content rather than solely on package size or unit price. Additionally, since bulk snack stores often expand through franchising, there may be variations in quality-control management across different outlets. Choosing well-established, reputable chain brands generally offers greater assurance.

According to industry data, approximately 60% of bulk snack outlets are currently operating at a loss, 20% are breaking even, and only 20% are profitable. This indicates that the industry is in a period of consolidation, with expectations for further improvements in store service and quality management going forward.