News of the company's impending acquisition by Meituan became official with a public announcement, prompting users to express their nostalgia on social media. This reaction surprised some Dingdong employees, who realized for the first time how much their service was appreciated and that their daily work had garnered significant recognition.

On the evening of February 5th, Meituan announced it would acquire all issued shares of Dingdong's Chinese business for an initial consideration of approximately $717 million. According to the announcement, Dingdong's overseas operations are excluded from this transaction and are planned to be spun off prior to the deal's completion.

This "union" does not come as a surprise. Over the past year, giants like Alibaba, Meituan, and JD.com have been engaged in fierce competition within the instant retail sector, offering massive subsidies to attract users. Fresh produce is a daily, high-frequency necessity for these users. Rumors about Dingdong exploring a sale had been circulating for two months, though JD.com was initially speculated to be the potential buyer.

On the same day, Dingdong's founder and CEO, Liang Changlin, issued a company-wide letter stating that the "board of directors had undergone careful deliberation" and decided to "set aside head-on competition and embark on a journey together." He believes that the missions of Meituan and Dingdong are "highly aligned" and that Dingdong's core competencies "will create greater value on a larger platform."

While the financial gain belongs to Dingdong's shareholders and the strategic vision belongs to Meituan, Dingdong's frontline employees continue to work according to the existing operational rhythm, despite uncertainty about the future, adopting a "wait and see" approach. In contrast, user reactions appear more intense, with concerns about potential changes to product selection and quality control.

To some extent, this is a narrative of a "survivor" reaching the finish line. The first half of the story was marked by the fervent expansion and cash-burning phase of fresh produce e-commerce, while the second half involved冷静的 strategic adjustments and contraction for survival. Eventually, with the arrival of deeper-pocketed players, niche "small but beautiful" platforms either struggle to sustain themselves until they eventually falter or make the choice to become part of a giant.

**The Acquired Survivor of Fresh Produce E-Commerce**

According to the announcement, the initial price of $717 million, combined with access to up to $280 million in additional funds, totals $997 million. This represents the full potential return for Dingdong's shareholders from the transaction, which is higher than the company's market capitalization on the announcement day, albeit significantly reduced from its historical peak.

As the acquisition only covers Dingdong's Chinese operations, its overseas segment must be completely spun off before completion. This means the listed entity of Dingdong will have nearly $1 billion on its books, while its core business—including its extensively developed front-end warehouse network, supply chain resources, and user base—will be integrated into Meituan.

Dingdong was founded in 2017, and its growth trajectory has mirrored the ups and downs of the front-end warehouse model. A front-end warehouse is a small-scale storage facility located closer to end-users than traditional central warehouses, situated near communities or commercial districts. Its characteristics are proximity, small size, and speed, enabling it to instantly fulfill user demand for fresh produce with an "order now, deliver immediately" promise.

While the advantages are clear, the drawbacks are equally apparent. For platforms utilizing this model, the costs associated with establishing and operating the warehouse network—including rent, fulfillment, and delivery expenses—remain high on financial statements, inevitably impacting profitability. For example, Dingdong's predecessor, Missfresh, reported fulfillment costs of 1.24 billion yuan, 1.83 billion yuan, and 1.58 billion yuan for 2018 through 2020, which at times accounted for 30% of revenue and over 50% of operating expenses. Therefore, without timely technological upgrades and efficient supply chain management to reduce waste and improve low margins, this model becomes a heavy burden for fresh produce e-commerce.

When Liang Changlin entered the fresh produce e-commerce arena, it was already crowded with small and medium-sized vertical players and internet giants making strategic investments and direct entries, leading to intense competition. Like Missfresh, Dingdong also went through phases of cash-burning expansion and continuous losses. However, unlike Missfresh, which continued to emphasize scale and market influence, Dingdong applied the brakes more swiftly and decisively.

In the third quarter of 2021, just two months after its IPO, Dingdong, which then operated 1,375 front-end warehouses, pivoted its strategy to "efficiency first, scale second." Starting in 2022, Dingdong began strategic contraction while developing its own brands. It closed stations in underperforming regions like Tangshan in Hebei, Zhuhai in Guangdong, Xuancheng in Anhui, and Chengdu in Sichuan, increasingly focusing the Jiangsu-Zhejiang-Shanghai area as its core base. More resources were allocated to upstream production, processing, and product development, optimizing the product mix.

Through cost reduction, a multi-category strategy, and refined management of its front-end warehouse system, Dingdong achieved its first profit on a non-GAAP basis in the second quarter of 2022. The latest financial report shows that for the third quarter of 2025, Dingdong's revenue reached 6.66 billion yuan, a historical high for a single quarter, representing a 2% year-over-year increase. On a non-GAAP basis, net profit was 100 million yuan, with a net profit margin of 1.5%, marking twelve consecutive quarters of profitability.

Furthermore, the overall monthly order conversion rate increased by 1.6 percentage points year-over-year during the quarter. The number of monthly ordering users grew by 4.1% year-over-year, and the average monthly order frequency reached a record high of 4.6 times, up 4.9% year-over-year. Among these users, members placed orders an average of 7.7 times per month, also a record high.

Dingdong remained on the battlefield, while contemporaries exited hastily. In July 2022, Missfresh, which had been listed for a year, announced the closure of its 30-minute express delivery service. Subsequently, the company reappeared in news reports often in connection with executives going missing, unpaid employee wages and supplier bills, and delisting, transforming the former star company into a cautionary tale.

**What Did Dingdong Do Right?**

When Dingdong shifted its focus from pursuing market scale to emphasizing average order value, repurchase rate, and order density, flashy marketing campaigns were no longer the key to user acquisition and activation; product quality itself took center stage.

As evidence, in the second quarter of 2022, when Dingdong first achieved non-GAAP profitability, revenue and GMV saw significant year-over-year growth, gross margin continued to improve, while fulfillment expense and sales expense ratios declined noticeably.

According to its official website, Dingdong defines itself as "a startup company focused on good food." Its mission is to "focus on the business of eating, striving to satisfy more people's desires for 'what to eat.' Through the supply of quality ingredients, the development of great tastes, and the incubation of food brands, we continuously provide solutions for a better life, dedicated to helping more people eat fresh, eat conveniently, eat diversely, and eat healthily."

This description can be seen as an explanation of Dingdong's competitive edge. Later, Liang Changlin summarized this with a "4G" strategy: Good Users, Good Products, Good Service, and Good Mindset. This means attracting users with higher demands for food quality and freshness through excellent products and service, thereby creating a distinct consumer perception compared to other channels.

A former Dingdong employee recalled that after leaving, they had not found another platform that placed such emphasis on product quality and respected the judgment of quality control. At Dingdong, product turnover was extremely fast, and quality control had veto power over product listings. Products from its own brands, such as Liangxin Jiangren, Youdouzhi, and Heizuan Shijia, underwent multiple rounds of screening before being listed. Beyond large-scale direct sourcing from origins and order-based farming, the platform even collaborated with upstream partners to establish breeding bases, deeply integrating into the supply chain. In his internal letter, Liang Changlin mentioned that Dingdong achieved direct sourcing for over 85% of its fresh produce and operated 12 self-owned factories and 2 self-owned farms.

Users are the best judges of this service. In their view, Dingdong's product selection balances seasonality and creativity, including items like rich Sichuan-style douhua, chewy handmade noodles, mung bean cakes that taste great simply stir-fried with scallions, and tender short-stemmed green vegetables. After-sales service is efficient, with customer service that "understands plain language" and resolves issues promptly without lengthy disputes, offering straightforward refunds when problems are confirmed. Delivery personnel are consistently polite, often wishing customers a "pleasant life." Some customers still remember delivery personnel handing over groceries and water over a wall, while others haven't forgotten apologies for accidentally ringing the wrong doorbell.

Interestingly, Dingdong's mission is "committed to food health, deliciousness, and innovation, helping people eat well and live better," while Meituan's mission is "help everyone eat better and live better," indicating a high degree of alignment. However, the more critical factor is likely Dingdong's strategic significance to Meituan's grocery retail business. As of September 2025, Dingdong operated over 1,000 front-end warehouses in China with more than 7 million monthly active purchasing users. Its existing resource reserves and user scale can complement Meituan's Xiaoxiang Supermarket. Whether acquiring a potential competitor or preventing a rival from gaining an advantage through acquisition, Meituan was unlikely to pass up this opportunity.

Acquisitions typically involve business consolidation and personnel integration. Liang Changlin revealed that Dingdong's business and team would remain stable, and Dingdong's official Xiaohongshu account also stated that "everything is running steadily." However, such assurances often fail to fully reassure users. After all, following its merger with Meituan, Dianping eventually became the Dianping Business Unit within Meituan's core local commerce segment. Similarly, Ele.me, acquired by Alibaba, has since been rebranded from blue to orange and renamed Taobao Quick Purchase, with its original brand identity fading away.

In the stairwells of Dingdong's office building, each step features green signs with white text. These display the "Dingdong Eight Admonitions," such as "Do not exploit suppliers, nor exploit employees" and "Don't take yourself too seriously, take what you do seriously," as well as the "Dingdong Values": "Believe in goodness, create value, the power of seeds, a humble heart." Employees see these messages every day. For now, these signs remain in place, but Dingdong's destiny is turning a new page, transitioning from an independent "small but beautiful" entity to becoming a part of a giant.