Dingdong Maicai's "Exit" Story: Meituan Sets Its Sights on East China, Liang Changlin Signs a 5-Year Non-Compete Agreement

Chinese New Year is approaching, and the fresh e-commerce industry is entering its busiest period of the year. At this time, Dingdong Maicai founder Liang Changlin also reaches the most special milestone in his over 8 years of entrepreneurship.

On February 5th, Meituan (03690.HK) issued an announcement ending the narrative of independent front warehouse operations. The announcement stated that Meituan would acquire 100% equity of Dingdong Maicai’s China business for an initial consideration of approximately $717 million (about 5 billion RMB). According to Nomura’s estimates, this transaction’s premium reaches 58%.

Since its founding in Shanghai in 2017, Dingdong Maicai has been synonymous with independent fresh produce e-commerce platforms. After its old rival, Missfresh, retreated, Dingdong Maicai has weathered cyclical fluctuations and reached its spring in 2026.

Although in Q3 2025, Dingdong Maicai reported its best performance with revenue of 6.66 billion RMB and profitability for 12 consecutive quarters, in an era dominated by giants and saturated markets, independent islands are hard to resist the tide of the ecosystem. On February 5th, Liang Changlin wrote in an internal letter: “Let go of the competition facing each other, and move towards working side by side.”

This major deal at the start of the year transforms Dingdong Maicai into the infrastructure for Meituan’s “30-minute delivery of everything to your home.” For Meituan founder Wang Xing, this is not just a tactical acquisition but a strategic supplement: expanding into the East China market, strengthening the fresh supply chain, and boosting high-frequency user engagement.

Thus, the independent fresh produce e-commerce platform finally cedes power to the big players. Dingdong hands over the baton, Meituan takes over, and a new phase of real-time retail competition led by giants officially begins.

Replenishing the Yangtze River Delta

Spring has arrived, but the cold in Xiaoshan District, Hangzhou, remains. On both sides of the street, Meituan Xiaoxiang Supermarket and Dingdong Maicai’s front warehouses face each other across the street. The footsteps of pickers and the startup sounds of electric bikes are the most authentic signs of the “alley warfare” between these two giants in the Yangtze River Delta.

This “close combat” scene has persisted for years. But since February 5th, their rivalry will shift to collaboration.

Meituan’s acquisition of Dingdong Maicai’s China business is essentially a “money-for-space” deal. While Meituan Xiaoxiang Supermarket has a competitive advantage in North China, Dingdong Maicai has a stronger fundamental presence in the most consumer-driven and highest penetration market—East China.

In Q3 2025, Dingdong Maicai’s GMV growth in Jiangsu and Zhejiang reached 40%, and in Shanghai, it grew by 24.5%. The average daily warehouse orders in Shanghai are close to 1,700. According to QuestMobile’s May 2025 report on instant retail traffic, Xiaoxiang Supermarket added 150 front warehouses in East China, showing strong emphasis on this market.

Why did Meituan choose to trigger the acquisition at the beginning of 2026?

A seasoned investor, Lin Shu (pseudonym), who previously invested in well-known fresh produce platforms, told Times Weekly that ultimately, business competition boils down to numbers. For Meituan, rather than fighting hard in East China, it’s better to buy the existing network.

He further explained that acquiring Dingdong Maicai means Meituan is taking over a high-market-share network in the Yangtze River Delta with over 1,000 mature front warehouses. “This is much more cost-effective than re-running the subsidy and warehouse expansion strategies in Jiangsu, Zhejiang, and Shanghai. In the land-scarce East China market, building warehouses is no longer just about throwing money—it’s about time costs.”

Lin Shu said that the fulfillment costs for front warehouses generally include warehouse rent, utilities, staff expenses, and logistics. Fulfillment costs are only part of the total costs of the front warehouse model; other costs include sales, marketing, management, and technology.

From Lin Shu’s perspective, the value of Dingdong Maicai’s “puzzle piece” lies in two dimensions. First, Dingdong’s user moat. Its member repurchase rate ranks among the top in the industry, and in today’s internet growth plateau, this “core fan” scale cannot be bought.

Second, the strategic advantage at the throat of the market. “In the instant retail field, capturing the ‘home cooks’ in the Yangtze River Delta means capturing China’s highest-frequency and most stable consumer group,” Lin Shu summarized. “Once this deal is completed, Meituan’s layout in East China is declared victorious. The remaining challenge is how to digest this ‘big piece of meat.’”

The Times Weekly noted that this acquisition excludes Dingdong Maicai’s overseas business. Industry insiders pointed out that by divesting complex cross-border legal risks and operations, Meituan can quickly connect Dingdong’s domestic foundation with Xiaoxiang Supermarket’s nationwide network.

Morgan Stanley’s research report states that acquiring Dingdong China’s business benefits Meituan, as Dingdong Maicai will generate synergy with Meituan’s existing Xiaoxiang Supermarket, further expanding its layout in East China and consolidating its core position in the self-operated fresh delivery (front warehouse) sector.

Going High and Landing Well

The most poignant part of this acquisition is the opponent that once fought Meituan for territory in East China, ultimately choosing to “land” at the most honorable moment.

Liang Changlin, a retired military officer, started multiple ventures after leaving the army. He was dedicated to the “vegetable basket” industry, using internet technology to “make good ingredients as accessible as tap water, benefiting everyone.”

However, in an era of traffic peak, independent e-commerce platforms often face extreme labor cost compression and profit struggles. With Meituan’s announcement, this 8-year marathon finally reaches its conclusion.

Dingdong Maicai was founded in Shanghai in 2017. During the “hundred-plant war” era, it focused on the “29-minute delivery” promise through a distributed, near-field front warehouse model. In 2021, Dingdong Maicai successfully listed on the NYSE. Despite subsequent industry turbulence and the collapse of Daily Fresh, Dingdong Maicai survived by withdrawing from inefficient regions, ultimately reversing its performance.

Financial reports show that from 2019 to 2022, Dingdong Maicai’s annual net losses were 1.87 billion RMB, 3.18 billion RMB, 6.43 billion RMB, and 807 million RMB, totaling over 10 billion RMB in losses. According to its Q3 2025 financial report, Dingdong Maicai achieved revenue of 6.66 billion RMB in that quarter, setting a quarterly record. Liang Changlin also revealed in an internal letter that Dingdong Maicai has maintained profitability for 12 consecutive quarters.

However, the fate of independent fresh produce e-commerce is that, regardless of model optimization, customer acquisition cost (CAC) remains an unsolvable math problem. In Q3 2025, when revenue hit a new high, Dingdong Maicai’s net profit margin was only 1.5%.

This low-margin model makes Dingdong Maicai vulnerable to heavy encirclement by giants like Alibaba’s Hema and JD’s Seven Fresh. Senior retail expert Zhang Weirong believes that even though Dingdong Maicai is profitable, its net profit margin of only 1.2%-1.5% remains low. Facing fierce competition from giants like Xiaoxiang Supermarket and Hema, the marginal cost of independent expansion continues to rise, limiting growth potential.

“Selling to Meituan” is a rational “high-level landing,” and Liang Changlin chose the most honorable way out.

In his letter to all staff, Liang Changlin explained that the reason for choosing Meituan is because Dingdong Maicai’s mission aligns closely with Meituan’s: “Helping everyone eat better, live better.” Post-merger, Dingdong Maicai’s core strengths—product quality, service, and supply chain efficiency—will be preserved and unleashed on Meituan’s broader platform, creating greater value. Both sides can further expand market coverage and realize the corporate mission of “making good ingredients as accessible as tap water.”

For Meituan, this transaction is also a crucial complement. As of September 2025, Dingdong Maicai operated over 1,000 front warehouses nationwide with more than 7 million monthly active users, while Xiaoxiang Supermarket has over 1,000 front warehouses. After the acquisition, Meituan will operate over 2,000 front warehouses—surpassing Sam’s Club.

Handing Power to the Giants

After Liang Changlin’s eight-year journey with Dingdong Maicai “landing” with dignity, this acquisition marks not only the end of the vertical e-commerce era but also a redefinition of the instant retail battlefield.

On December 1, 2023, Meituan’s self-operated retail brand “Meituan Maicai” was rebranded as “Xiaoxiang Supermarket,” signaling a shift from fresh food and groceries to full-category retail. With the “takeout war” among the three major platforms intensifying last year, the competition in instant retail has evolved from “fast delivery” to supply chain capabilities.

Dingdong Maicai, as the “dowry” brought to Meituan, is its eight-year supply chain infrastructure. Liang Changlin revealed that Dingdong Maicai has over 5% direct sourcing from sources, 12 self-operated factories, and 2 self-operated farms, forming an efficient supply chain centered on quality fresh produce.

This acquisition embeds Meituan with the gene of direct sourcing from fresh produce origins, completing a mental shift in consumers from a fresh retailer to a fresh produce supplier.

CICC (601995) in its research report pointed out that in terms of supply chain, Meituan Xiaoxiang Supermarket is expected to acquire Dingdong’s direct sourcing sources and self-operated factories, enhancing its product strength and variety in fresh produce. Regionally, Xiaoxiang Supermarket is accelerating front warehouse expansion, and may integrate Dingdong’s assets to support large-scale expansion, especially in East China.

Currently, the competition in instant retail has entered a “knife fight” stage. The Ministry of Commerce’s International Trade and Economic Cooperation Research Institute predicts that by 2030, China’s instant retail market will exceed 2 trillion RMB. Price subsidies, traffic entry points, and supply chain capabilities are the three key factors determining victory or defeat.

In this context, the landscape among fresh supply chain giants is changing. At the start of the new year, Hema CEO Yan Xiaolei disclosed in an internal letter that in 2025, the company’s overall revenue growth exceeded 40%, and GMV is expected to surpass 100 billion RMB this fiscal year. JD’s “Seconds Delivery” and Seven Fresh are collaborating to reduce costs and improve efficiency through supply chain integration, continuously expanding in core cities.

Faced with giants’ encirclement, Dingdong Maicai has chosen a different path. With this deal finalized, the era of independent fresh produce e-commerce ends with Dingdong Maicai’s sale to Meituan, and a new pattern of “one super, multiple strong” will emerge.

Capital’s Final Chapter

In this major early-year deal, the most noteworthy aspect is the capital constraints in the terms.

Times Weekly noticed that Meituan’s announcement states that the transferor can withdraw no more than $280 million from the target group, but must ensure that the net cash of the target group at closing is no less than $150 million.

A Hong Kong stock analyst told Times Weekly that such arrangements are uncommon in M&A deals and essentially serve as a financial safety lock. By setting a cash red line, Meituan allows the founding team to gain some liquidity while retaining the blood needed to support the operation of the extensive front warehouse network, ensuring a smooth integration post-transaction.

However, this deal also faces organizational integration pains. The announcement promises that during the transition period, Dingdong Maicai will continue to operate under its pre-deal model. Liang Changlin also stated in his internal letter: “Dingdong Maicai’s business and team will remain stable, and everyone will still have a very stable platform for development.”

But many industry insiders believe that, based on Meituan’s past mergers with Dianping and Mobike, overlapping functions and reallocation of authority are highly likely.

Times Weekly also noted that Meituan’s announcement states that Liang Changlin has committed to a five-year non-compete obligation in the Greater China region’s fresh food and grocery To C e-commerce sector from the date of closing.

Regardless of future developments, this acquisition will mark a significant chapter in the decade-long rollercoaster of China’s independent fresh produce e-commerce.

Looking back to 2021, that was the peak moment for independent fresh produce platforms. Dingdong Maicai and Missfresh successively listed in the US, and capital markets hoped that the front warehouse model could produce the next retail giant. At that time, Dingdong Maicai raised over $1 billion in two rounds of funding in 37 days, with investors including Gao Rong Capital, Dachen Venture Capital, Sequoia China, Today Capital, and Chinese Cultural Fund.

However, the glory was fleeting. In 2022, the former “number one in front warehouses,” Missfresh, collapsed due to a liquidity crisis, failing to find a buyer. In contrast, Dingdong Maicai’s ability to “maintain profitability for 12 consecutive quarters” is a rare “happy ending” in this track.

Dingdong Maicai’s eight years have been an experiment in ideals and efficiency. It was once a symbol of independent fresh produce e-commerce, but also repeatedly hovered on the edge of losses due to capital retreat. Its “landing” marks the end of an era where a single model and vertical track could dominate. The landscape of instant retail is now set, leaving future entrants with only one obstacle—an efficiency wall waiting to be broken.