[Revealed] Relx E-Cigarette Franchise and Distribution Channel Model

RELX is now the number one brand in China’s vaping industry. I believe that position is beyond doubt, and it is a fact that all brands in the industry have to acknowledge. In the blogger’s estimate, based on RELX’s current market share, it accounts for at least over 70%. It really sums up to this saying: “In the vaping industry, apart from RELX, everything else is just the rest.” Of course, that is a joke, but it also reflects RELX’s currently unshakable position. As for what happens in the future, that remains to be seen—other strong competitors may still emerge.

The main franchise channel for RELX vaping products is the distributor model. RELX divides its distributorships into domestic and overseas categories, and here we mainly analyze the domestic distribution model. RELX distributorships are highly sought after, and the profits are also very considerable, so it is difficult to secure a RELX distributorship without investing at least several million yuan. The largest distributor operator is probably Aisidi, which holds distribution authorization for all regions nationwide. The others are regional distributors, with each area recruiting separately, such as the “Changsha region” or the “Changde region.” The divisions are quite granular, and cross-regional sales are not allowed.

As a result, RELX has many distributors under its umbrella, especially numerous smaller provincial and municipal distributors. Aisidi, meanwhile, is the national distributor and holds authorization for all domestic regions. This creates an obvious issue: there is inevitably competition between them, and it is extremely fierce—to the point of openly fighting for territory. This has led to a very interesting situation in which most regional distributors have formed alliances against Aisidi, and competing for store locations has become a routine occurrence.

In fact, the biggest beneficiary of this model is still RELX. As the company behind the network, the greater the competition among its distributors, the faster RELX stores expand. In less than a year, more than 5,000 RELX specialty stores had opened nationwide, covering nearly all first-, second-, third-, and fourth-tier cities, and many county-level areas now also have RELX stores. Of course, no matter how intense the competition is, these distributors are still very willing to develop the market. At the root of it all is the huge profit incentive involved.

Now let’s look at franchise stores nationwide. In many first-tier cities, stores have already become very densely distributed. You may find a RELX specialty store within one or two kilometers, and sometimes even two specialty stores within just one or two hundred meters. But are these specialty stores really profitable?

Indeed, many specialty stores are very profitable, especially those in exceptionally good locations. Some may generate monthly sales of RMB 300,000 to RMB 400,000, although these are exceptional cases and relatively rare. On the other hand, in areas with poor locations or immature markets—such as less developed small counties—monthly sales of under RMB 20,000 are also common, and a payback period stretching to one year is normal.

So in the brick-and-mortar economy, no matter what business you are in, a good location is crucial. This is especially true in the vaping industry, where online channels have been banned, making location even more important.

The above article reflects only the blogger’s personal views and is highly subjective. If it infringes on any rights or interests, please contact the blogger for removal.