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RETAILING IN CHINA
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Euromonitor International
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II
Forecast Sales in Store-Based Retailing by Channel: % Value Growth 2012-2017 .................................................................................................. 21 Forecast Store-Based Retailing Outlets by Channel: % Unit Growth 2012-2017 .................................................................................................. 21 Forecast Sales in Non-store Retailing by Channel: Value 2012-2017 ........ 21 Forecast Sales in Non-store Retailing by Channel: % Value Growth 2012-2017 .................................................................................................. 22 Forecast Sales in Non-Grocery Retailers by Channel: Value 20122017 ........................................................................................................... 22 Forecast Non-Grocery Retailers Outlets by Channel: Units 2012-2017 ..... 22 Forecast Sales in Non-Grocery Retailers by Channel: % Value Growth 2012-2017 ..................................................................................... 23 Forecast Non-Grocery Retailers Outlets by Channel: % Unit Growth 2012-2017 .................................................................................................. 23
Appendix .................................................................................................................................... 23 Operating Environment ........................................................................................................... 24 Cash and Carry....................................................................................................................... 25 Table 37 Cash and Carry: Number of Outlets by National Brand Owner 20092012 ........................................................................................................... 25
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RETAILING IN CHINA
EXECUTIVE SUMMARY Overall Vigorous Growth for Retailing in China
Overall, retailing in China remained vigorous in 2012, with double-digit current value growth. The central governments emphasis on domestic demand to boost the economy through stimulus packages has been translated into dynamic retailing market movement, particularly explosive growth in internet retailing, as well as buoyant homeshopping, direct selling and mixed retailing, in addition to the steady development of grocery retailers.
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Food, clothing and shelter-related retailing channels are expected to continue to perform well in the forecast period. Grocery retailers, apparel specialist retailers, and furniture and homewares stores are expected to experience value CAGRs of 6%, 11%, and 9%, respectively. The growing pursuit of better quality in these daily necessities will contribute to strong value growth, with more frequent purchases as well as the upgrading of existing products. Many non-traditional retailing channels are likely to take off and demonstrate dynamic value growth in the forecast period, with internet retailing growing at a CAGR of 29% in constant value terms, and homeshopping at 17% annually. With the rising number of internet users and improving internet security in China, more consumers are expected to purchase on-line, thanks to its convenience and competitive prices. With just a few clicks, ordered items can be delivered to ones doorstep. Those who are not internet-savvy have the alternative retailing channel of homeshopping, through which consumers can make purchases via telephone or mail order.
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companies. Suning Appliance Co Ltd is the only exception, having developed from a traditional electronics and appliance specialist retailer into a leading internet retailer via huge investment and a series of mergers and acquisitions over the review period. Outlook With the gradual penetration of the internet into more remote areas and the increasing availability of fibre optic broadband, the number of internet users in China is expected to continue to see strong growth in the forecast period, to reach over 800 million by 2015, according to CNNIC, with one quarter of new internet users located in rural areas. With the rising ownership of smartphones among Chinese consumers, more internet users are expected to surf with their mobile phones, which will greatly facilitate on-the-go consumption, for instance, shopping while commuting to work. Overall, the steadily growing number of internet users in China will form a solid consumer base for internet retailing over the forecast period. Future impact With the rise in internet users and on-line shoppers in China, internet retailing is expected to continue its buoyant value growth, with a CAGR of 29% in constant value terms over the forecast period, the highest among all retail channels. Many pure e-commerce companies, such as 360buy.com and Joyo.com, will continue to open their platforms to third-party sellers, in order to enrich the product portfolio and attract a wider range of consumers. These pure e-commerce companies have been making efforts to establish nationwide logistics facilities, to accelerate delivery services and to enhance customers shopping experience. More retailers are likely to make debut in the internet retailing market, including the number one player in direct selling, Amway China. Many traditional retailers are expected to strengthen their on-line presence, but still prioritise the sales of their retailing outlets, so as to secure their market share. Their major aim is to complement the sales of their retail stores with internet sales. However, some may apply a totally different internet strategy. Suning Appliance Co Ltd, for instance, will adopt a dual operational strategy by simultaneously emphasising flagship retailing stores and internet retailing. Parkson Retail Group Ltd will adopt a similar strategy, and new products are expected to be launched at the same time via its on-line platform and via retail outlets. In spite of the vigorous growth of internet retailing in China, store-based retailing will maintain healthy growth in the forecast period. This is mainly because consumers are still expected to rely on retailing outlets for many daily necessities, such as fresh produce. In-store comparison and quality checks for such bulk items such as furniture are also deemed indispensable for many consumers. Overall, store-based retailing is expected to grow by a value CAGR of 8% in the forecast period. Most Chinese consumers will remain price-sensitive, owing to their relatively low purchasing power. They are expected to maintain the habit of checking prices before making any purchase, using comparisons among various B2C on-line platforms as well as between on-line and storebased retail outlets. Many price-comparison websites emerged in the review period, including etao.com, manmanbuy.com and bbbao.com. Such websites are likely to become more sophisticated in the forecast period, with consumers likely to rely more on them when submerged in a sea of on-line shopping platforms.
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Trade-In Subsidy Programme and the Rural Household Appliances Subsidy Programme had a significant impact on consumers. Following the end of the above mentioned two programmes, the relevant authorities introduced the Green Household Appliances Subsidy Programme in June 2012, in an attempt to boost sales of inverter technology in consumer appliances such as fridge freezers, automatic washing machines and air conditioners, with subsidies of up to RMB400 per unit. To improve incomes for rural residents, the Ministry of Commerce initiated the Nong Chao Dui Jie Programme, (Linking Farms to Supermarkets Programme) in 2008, to strengthen links between farmers and retailers via direct procurement, in order to cut out middlemen and benefit farmers and local consumers. Current impact The Household Appliances Trade-In Subsidy Programme and the Rural Household Appliances Subsidy Programme greatly boosted the sales of electronics and appliances in the review period, thanks to the subsidies for household appliances on the approved list, like washing machines and refrigerators, which are regarded as necessities for an average family. Overall, electronics and appliance specialist retailers saw a value CAGR of 12% between 2007 and 2012, with particularly robust growth for chained operations in this category. However, the end of these two programmes by the end of 2011 had a negative impact on the electronics and appliance specialist retailers, which suffered a drastic value sales growth drop in 2012 compared to that in 2011. Following the success of these two programmes, the Ministry of Commerce launched the Green Household Appliance Subsidy Programme in June 2012, but the new programme, which so far has relatively low awareness among consumers, has not yet taken full effect. By the end of 2011, the central government had spent RMB00 million in supporting the Nong Chao Dui Jie Programme, with over 1,000 ongoing projects in 19 provinces and around 800 chained retailers involved in the programme. Many international and domestic players have been engaged in it, including Wal-Mart (China), Wumart, Tesco China, Shenzhen A-Best, Lianhua Supermarket, and China Resources. With direct procurement from farmers through this programme, products are fresher and cheaper, especially for fresh produce, including vegetables and fruit. With many grocery retailers increasing the portion of fresh produce in their total product portfolio, in line with the local consumer preference for such products, the Nong Chao Dui Jie Programme has benefited not only farmers but also helped boost the value sales growth of retailers. Outlook The Green Household Appliance Subsidy Programme is expected to enhance its awareness among locals with the stepping up consumer education and to take full effect in boosting value sales of electronics and appliance specialist retailing over the forecast period. According to the Ministry of Commerce, the Nong Chao Dui Jie Programme is still at the pilot stage. The authorities are expected to enhance the programme over the forecast period by strengthening the infrastructure for the distribution of agricultural products and optimising the operation of production bases for farmers. To further improve incomes for farmers, the Ministry of Commerce plans to extend the Nong Chao Dui Jie Programme to supermarket chains located overseas, to enable more overseas consumers to purchase local agricultural products, particularly fruit. Farmers with higher incomes will have higher budgets for consumption, which should contribute to the domestic retailing market.
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Future impact With the stimulus of the Green Household Appliance Subsidy Programme, more consumers are expected to trade up to the more energy-efficient products approved under this scheme, supported by rising disposable incomes and growing awareness of environmental issues. The value CAGR of electronics and appliance specialist retailers is expected to be 8% over the forecast period outperforming the constant value growth in 2012. Enhanced profit margins for electronics and appliances manufacturers, through rising sales of high-tech products such as electronics appliances with inverter technology, will enable manufacturers to spend more on R&D of more high-tech and user-friendly products, which will add dynamism to the category over the forecast period. With more chained grocery retailers likely to be involved in the Nong Chao Dui Jie Programme, direct procurement of daily necessities such as rice, vegetables and fruit is expected to increase further, to represent a greater proportion of the total product portfolio for retailers, particularly for fresh produce, which is highly favoured by local consumers. The increased supply of fresh produce in supermarkets is likely to witness more purchases from customers, further boosting value sales of grocery retailers. According to the Ministry of Commerce, directly procured agricultural products are expected to double in value sales in the upcoming five years, with more chained operators involved in the programme. In addition to the increase in direct procurement, the product portfolio is also expected to be further enriched to cater to consumers changing needs. This increasingly sophisticated programme is expected to be a positive factor in the healthy growth of grocery retailers in the forecast period.
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been active in developing private label. Shanghai Bailian, after the successful launch of its private label jewellery with the brand name Yong An in 2011, is planning to introduce more private label lines, which are viewed as a new source of corporate revenue. Belle International launched a new fast fashion private label, 15 MINS, in 2012, adding to its range of private labels, so as to cater to a wide range of consumers, from mass to premium. Furthermore, some internet retailers ventured into the potentially lucrative private label niche by launching new brands. Pure e-commerce operator dangdang.com introduced an apparel private label line, Dangdang Baby, in 2012, priced at 30-50% lower than similar branded products. Outlook Overall, private label is expected to experience steady growth over the forecast period, thanks to the continuous efforts on the part of retailers to enrich their product portfolios and to cater to a wider range of consumers. Grocery retailing is expected to continue to account for the majority of value sales of private label, while non-grocery retailing is expected to further tap into private label as a steady source of sales revenue and higher gross profit margins, especially for mixed retailers. Instead of concentrating on budget ranges, private label lines are expected to be more diversified in market positioning, with more mid-range and even premium brands making their debut in the market, to meet diversified consumer needs for such products. Future impact For grocery retailers, fresh produce may be the next key product category for further development in private label. retailers are likely to upgrade the packaging for private label to change consumers persistent association of private label with inferior products. Lianhua Supermarket, for example, plans to upgrade the packaging of its private label lines to change the brand image among local consumers. The new packaging of its private label lines is likely to premiere in the market in early 2013. In addition to improving packaging, retailers are expected to launch more non-budget range private labels, similar to Seven Premium, by Seven & I, targeting the premium range. These mid-range and high-end private label lines are likely to be carefully marketed and well packaged, with some consumers not being aware that they are actually private labels from retailers. There could be more new market entrants in the forecast period, particularly non-grocery retailers. Pure e-commerce internet retailer 360buy.com is said to be likely to launch private label apparel during the forecast period, in view of the success of its rival dangdang.com, which launched private label apparel in the review period.
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existing outlets, to cater to consumers need to shop in a specialist department store or in a shopping mall with many foodservice outlets. Parkson Retail Group, for example, is revamping its flagship department store in Shanghai and Beijing to incorporate more foodservice outlets. Grocery retailers, on the other hand, have endeavoured to improve their on-line stores by providing a range of consumer-friendly services, including home delivery and self pick-up in nearby outlets. To cater to the local consumer preference for fresh produce, grocery retailers have increased the proportion of such products in the total portfolio and have sourced products directly from producing areas to ensure freshness and quality. Many grocery retailers are constantly optimising the merchandise mix in their outlets to cater to consumers changing needs. For convenience store chains, operators may increase the proportion of ready-to-serve meals in outlets near office buildings, and even add coffee machines to serve freshly brewed coffee at competitive prices. Outlook To survive and stay competitive, more retailers are expected to adopt customer-centric strategies, focusing on meeting consumers various needs and enhancing their shopping experience over the forecast period. This trend may be particularly apparent in internet retailing, which is currently characterised by extremely fierce competition. Other retailers will also optimise their operations and management, in order to provide service of the highest standard to customers. Future impact Retailers are expected to come up with new solutions to provide as much convenience as possible to local consumers. In the latter part of the review period, 360buy.com launched a 24hour self pick-up locker service in Beijing, through which consumers can collect their orders via the locker service with the locker number and password sent to them by SMS via mobile phone. Furthermore, in late 2012, the company also cooperated with the convenience store chain Hi-24 in Beijing to provide a self pick-up service for on-line orders. Such creative customer-friendly services are expected to boost sales and will be more commonly adopted by internet retailers over the forecast period. Logistics, which are key to satisfactory customer service, are expected to be further strengthened over the forecast period. The number one player in internet retailing, taobao.com, has just started to work with local logistics companies to build warehouses in seven cities in China, mainly to ease logistics pressure, especially during the November 11th Shopping Spree Festival period in 2012. After obtaining an express delivery licence from the State Post Bureau of China in September 2012, 360buy.com will continue to accelerate its order delivery service, to maintain its competitive edge over rivals. Grocery retailers are also expected to enlarge their logistics capacity in order to better serve customers. China Resources plans to establish a new flagship logistics centre in Fenggang Town, Dongguan, Guangdong province, to further upgrade its logistics system. The largest logistics centre yet for Lianhua Supermarket is currently under construction, to be completed by 2014. With investment of RMB800 million, this centre is located in the suburban area of Shanghai, to serve Lianhuas outlets located in the Yangtze River Delta in a more efficient way.
MARKET INDICATORS
Table 1 Employment in Retailing 2007-2012 2007 2008 2009 2010 2011 2012
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Total employment ('000 people) Employment in retailing ('000 people) Employment in retailing (%) (% of total employment)
Source:
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews
MARKET DATA
Table 2 Sales in Retailing by Channel: Value 2007-2012
RMB bn, retail value rsp excl sales tax 2007 Store-based Retailing Non-Store Retailing Retailing
Source:
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 3
% current value growth, retail value rsp excl sales tax 2011/12 Store-based Retailing Non-Store Retailing Retailing
Source:
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 4
RMB bn, retail value rsp excl sales tax 2007 Grocery Retailers Non-Grocery Retailers Store-based Retailing
Source:
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 5 outlets
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10
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 6
% current value growth, retail value rsp excl sales tax 2011/12 Grocery Retailers Non-Grocery Retailers Store-based Retailing
Source:
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 8
RMB bn, retail value rsp excl sales tax 2007 Direct Selling Homeshopping Internet Retailing Vending Non-Store Retailing
Source: Note:
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources Vending data captures vending systems installed in public and semi-captive environments only. For further details refer to definitions.
Table 9
% current value growth, retail value rsp excl sales tax 2011/12 Direct Selling 20.0 2007-12 CAGR 16.1 2007/12 Total 110.5
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11
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources Vending data captures vending systems installed in public and semi-captive environments only. For further details refer to definitions.
Table 10
% retail value rsp excl sales tax 2007 Grocery Non-Grocery Total
Source:
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 11
RMB bn, retail value rsp excl sales tax 2007 Apparel Specialist Retailers Electronics and Appliance Specialist Retailers Health and Beauty Specialist Retailers Home and Garden Specialist Retailers Leisure and Personal Goods Specialist Retailers Mixed Retailers Other Non-Grocery Retailers Non-Grocery Retailers
Source:
214.8 486.6
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 12 outlets
2007 Apparel Specialist Retailers Electronics and Appliance Specialist Retailers 309,460 28,191
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12
Health and Beauty Specialist Retailers Home and Garden Specialist Retailers Leisure and Personal Goods Specialist Retailers Mixed Retailers Other Non-Grocery Retailers Non-Grocery Retailers
Source:
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 13
% current value growth, retail value rsp excl sales tax 2011/12 Apparel Specialist Retailers Electronics and Appliance Specialist Retailers Health and Beauty Specialist Retailers Home and Garden Specialist Retailers Leisure and Personal Goods Specialist Retailers Mixed Retailers Other Non-Grocery Retailers Non-Grocery Retailers
Source:
2007-12 CAGR 17.8 11.9 12.0 12.8 13.7 14.9 12.2 13.3
2007/12 Total 127.0 75.8 75.9 83.0 89.7 99.9 77.5 86.7
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
2011/12 Apparel Specialist Retailers Electronics and Appliance Specialist Retailers Health and Beauty Specialist Retailers Home and Garden Specialist Retailers Leisure and Personal Goods Specialist Retailers Mixed Retailers Other Non-Grocery Retailers Non-Grocery Retailers
Source:
2007-12 CAGR 10.6 13.9 6.8 6.9 8.1 5.7 3.9 7.5
2007/12 Total 65.7 91.4 39.1 39.7 47.6 31.9 21.0 43.7
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 15
2008
2009
2010
2011
2012
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13
Taobao.com China Resources Enterprise Co Ltd Suning Appliance Co Ltd Sun Art Retail Group Ltd GOME Electrical Appliances Holding Ltd Wal-Mart (China) Investment Co Ltd Lianhua Supermarket Holdings Co Ltd 360buy.com Dashang Group Carrefour (China) Hypermarket Co Ltd Belle International Holdings Ltd Amway (China) Co Ltd Shanghai Nong Gong Shang Supermarket Co Ltd Chongqing Department Store Co Ltd Hisap High Technology Corp Yonghui Superstores Co Ltd Shenzhen A-Best Supermarket Co Ltd Parkson Retail Group Ltd Watson (Group) HK Ltd, AS Beijing Wangfujing Department Store Co Ltd Trust-Mart Co Ltd Auchan China Others Total
Source:
0.9 0.8 0.9 0.4 0.5 0.0 0.4 0.5 0.3 0.3 0.4 0.1 0.3 0.1 0.3 0.2 0.1 0.2 0.2 0.6 92.4 100.0
0.9 0.9 0.8 0.5 0.6 0.1 0.4 0.5 0.3 0.3 0.4 0.1 0.2 0.1 0.3 0.2 0.1 0.2 0.2 0.7 92.3 100.0
0.4 1.0 1.0 0.9 0.5 0.6 0.1 0.4 0.5 0.3 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.7 91.5 100.0
1.1 1.0 1.0 0.8 0.9 0.6 0.6 0.3 0.4 0.4 0.3 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.1 90.4 100.0
2.1 1.1 1.0 0.8 0.7 0.6 0.5 0.5 0.4 0.4 0.3 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 89.3 100.0
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 16
% retail value rsp excl sales tax Brand Company Tmall Suning Gome RT Mart Walmart 360buy CR Vanguard Hypermarket CR Sugo Carrefour Taobao.com Suning Appliance Co Ltd GOME Electrical Appliances Holding Ltd Sun Art Retail Group Ltd Wal-Mart (China) Investment Co Ltd 360buy.com China Resources Enterprise Co Ltd China Resources Enterprise Co Ltd Carrefour (China) Hypermarket Co Ltd
2011 1.1 1.0 0.9 0.6 0.6 0.3 0.4 0.4 0.4
2012 2.1 1.0 0.7 0.7 0.6 0.5 0.4 0.4 0.4
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Amway Lianhua Supermarket Hisap Dashang, Newmart Yonghui NGS-mart CR Vanguard Supermarket Century Mart A-Best Parkson Wangfujing Trust-Mart RT Mart Others Total
Source:
Amway (China) Co Ltd Lianhua Supermarket Holdings Co Ltd Hisap High Technology Corp Dashang Group Yonghui Superstores Co Ltd Shanghai Nong Gong Shang Supermarket Co Ltd China Resources Enterprise Co Ltd Lianhua Supermarket Holdings Co Ltd Shenzhen A-Best Supermarket Co Ltd Parkson Retail Group Ltd Beijing Wangfujing Department Store Co Ltd Trust-Mart Co Ltd Auchan China
0.3 0.3 0.2 0.2 0.1 0.3 0.1 0.2 0.3 0.2 0.2 0.2 0.5 93.5 100.0
0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.6 92.8 100.0
0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.1 91.6 100.0
0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.2 90.6 100.0
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 17
% retail value rsp excl sales tax Company China Resources Enterprise Co Ltd Suning Appliance Co Ltd Sun Art Retail Group Ltd GOME Electrical Appliances Holding Ltd Wal-Mart (China) Investment Co Ltd Lianhua Supermarket Holdings Co Ltd Dashang Group Carrefour (China) Hypermarket Co Ltd Belle International Holdings Ltd Shanghai Nong Gong Shang Supermarket Co Ltd Chongqing Department Store Co Ltd Hisap High Technology Corp Yonghui Superstores Co Ltd Shenzhen A-Best Supermarket Co Ltd Parkson Retail Group Ltd Watson (Group) HK Ltd, AS Beijing Wangfujing Department Store Co Ltd Wumart Stores Inc
2008 0.9 0.8 0.9 0.4 0.5 0.4 0.5 0.3 0.4 0.1 0.3 0.1 0.3 0.2 0.1 0.2 0.1
2009 0.9 0.9 0.8 0.5 0.6 0.4 0.5 0.3 0.4 0.1 0.2 0.1 0.3 0.2 0.1 0.2 0.2
2010 1.0 1.0 0.9 0.5 0.6 0.4 0.5 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2
2011 1.0 1.0 0.8 1.0 0.6 0.6 0.4 0.5 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2
2012 1.1 1.0 0.8 0.8 0.7 0.6 0.4 0.4 0.4 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2
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15
Golden Eagle Retail Group Ltd Wuhan Zhongbai Group Co Ltd Trust-Mart Co Ltd Auchan China Others Total
Source:
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 18
% retail value rsp excl sales tax Brand Company Suning Gome RT Mart Walmart CR Vanguard Hypermarket CR Sugo Carrefour Lianhua Supermarket Hisap Dashang, Newmart Yonghui NGS-mart CR Vanguard Supermarket Century Mart A-Best Parkson Wangfujing Wumart Golden Eagle Wuhan Zhongbai Trust-Mart RT Mart Others Total
Source:
2009 0.9 0.8 0.5 0.3 0.4 0.5 0.3 0.2 0.2 0.1 0.3 0.1 0.2 0.3 0.2 0.2 0.2 0.1 0.2 0.2 0.5 93.3 100.0
2010 1.0 0.9 0.5 0.4 0.4 0.5 0.3 0.3 0.2 0.2 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.1 0.2 0.2 0.6 93.0 100.0
2011 1.0 1.0 0.7 0.6 0.4 0.4 0.5 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.1 92.7 100.0
2012 1.0 0.8 0.7 0.7 0.4 0.4 0.4 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 92.8 100.0
Suning Appliance Co Ltd GOME Electrical Appliances Holding Ltd Sun Art Retail Group Ltd Wal-Mart (China) Investment Co Ltd China Resources Enterprise Co Ltd China Resources Enterprise Co Ltd Carrefour (China) Hypermarket Co Ltd Lianhua Supermarket Holdings Co Ltd Hisap High Technology Corp Dashang Group Yonghui Superstores Co Ltd Shanghai Nong Gong Shang Supermarket Co Ltd China Resources Enterprise Co Ltd Lianhua Supermarket Holdings Co Ltd Shenzhen A-Best Supermarket Co Ltd Parkson Retail Group Ltd Beijing Wangfujing Department Store Co Ltd Wumart Stores Inc Golden Eagle Retail Group Ltd Wuhan Zhongbai Group Co Ltd Trust-Mart Co Ltd Auchan China
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 19
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16
sites/outlets Brand Easy Joy uSmile 361 Degrees Tong-Jun-Ge Peak Anta Xtep Li Ning Septwolves Lianhua Supermarket Suning Gome Laomiao, First Asia CR Sugo Watson's Your Personal Store Hualian CR Vanguard Supermarket Wuhan Zhongbai Liqun Wenfeng Avon Others Total
Source:
Company China Petroleum & Chemical Corp China National Petroleum Corp 361 Degrees International Ltd Chongqing Tongjunge Drugstores Co Ltd Peak Sport Products Co Ltd Anta (China) Co Ltd Xtep International Holdings Ltd Li Ning Co Ltd Fujian Septwolves Industry Co Ltd Lianhua Supermarket Holdings Co Ltd Suning Appliance Co Ltd GOME Electrical Appliances Holding Ltd Shanghai Yuyuan Tourist Mart Co Ltd China Resources Enterprise Co Ltd Watson (Group) HK Ltd, AS Lianhua Supermarket Holdings Co Ltd China Resources Enterprise Co Ltd Wuhan Zhongbai Group Co Ltd Liqun Group Wenfeng Great World Chain Development Corp Avon (China) Co Ltd
2009 12,400 8,800 6,693 7,102 6,206 6,591 6,103 7,249 3,249 1,668 941 944 1,100 1,419 550 1,150 586 676 882 642 6,000 5,326,120 5,407,071
2010 16,000 11,176 7,263 7,506 7,224 7,549 7,031 7,915 3,525 1,906 1,311 1,113 1,341 1,255 800 1,108 700 713 830 682 2,100 5,487,575 5,576,623
2011 19,200 14,500 7,865 7,955 7,806 7,778 7,596 8,255 3,976 1,941 1,684 1,461 1,395 1,277 1,000 1,043 825 788 831 740 5,636,186 5,734,102
2012 22,200 16,574 8,425 8,365 8,206 7,988 7,946 7,280 4,376 2,121 1,665 1,472 1,450 1,308 1,220 1,023 974 850 812 810 5,823,828 5,928,893
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 20
% retail value rsp excl sales tax Company Taobao.com 360buy.com Amway (China) Co Ltd Suning Appliance Co Ltd Infinitus (China) Co Ltd VANCL Chengpin (Beijing) Technology Co Ltd Joyo.com
1.4
2.0
1.9
1.5
1.3
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17
Hangzhou Mary Kay Cosmetics Co Shanghai SMG-CJ Homeshopping Co Ltd Dangdang.com yihaodian.com Happigo Co Ltd Dell (China) Co Ltd New Era Health Industry (Group) Co Ltd Icson E-commerce Development Co Ltd Tianjin Tianshi Biological Development Co Ltd Hao Xiang Go Co Ltd Perfect (China) Co Ltd Jiayou Homeshopping Co Ltd lafaso.com Nanfang Lee Kum Kee Co Ltd Others Total
Source: Note:
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources Vending data captures vending systems installed in public and semi-captive environments only. For further details refer to definitions.
Table 21
% retail value rsp excl sales tax Brand Company Tmall 360buy Amway Suning Infinitus Vancl Taobao.com 360buy.com Amway (China) Co Ltd Suning Appliance Co Ltd Infinitus (China) Co Ltd VANCL Chengpin (Beijing) Technology Co Ltd Joyo.com Hangzhou Mary Kay Cosmetics Co Shanghai SMG-CJ Homeshopping Co Ltd Dangdang.com yihaodian.com Happigo Co Ltd Dell (China) Co Ltd New Era Health Industry (Group) Co Ltd Icson E-commerce Development Co Ltd Tianjin Tianshi Biological Development Co Ltd Hao Xiang Go Co Ltd
Joyo Mary Kay OCJ Dangdang Yihaodian Happigo Dell Guozhen icson Tiens
2.0 5.1 3.2 1.7 0.1 2.4 2.8 2.2 0.3 2.0
1.9 3.1 2.5 1.5 0.5 1.8 1.8 1.7 0.4 1.3
1.5 1.8 1.6 1.1 0.9 1.3 1.5 1.1 0.6 0.9
1.3 1.2 1.2 1.1 1.0 1.0 0.9 0.8 0.8 0.7
Enjoy Shopping
0.6
0.7
0.7
0.7
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Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources Vending data captures vending systems installed in public and semi-captive environments only. For further details refer to definitions.
Table 22
% retail value rsp excl sales tax Company Suning Appliance Co Ltd GOME Electrical Appliances Holding Ltd Dashang Group Belle International Holdings Ltd Hisap High Technology Corp Parkson Retail Group Ltd Beijing Wangfujing Department Store Co Ltd Golden Eagle Retail Group Ltd Chongqing Department Store Co Ltd Jiangsu Five Star Appliance Co Ltd Shanghai Bailian Group Co Ltd Intime Department Store (Group) Co Ltd Watson (Group) HK Ltd, AS Shanghai Yuyuan Tourist Mart Co Ltd New World Department Store China Ltd Chow Tai Fook Jewellery Group Ltd Maoye International Holdings Ltd Bestseller Fashion Group (TianJin) Co Ltd Van's Department Store Co Ltd Silver Plaza Group Co Ltd Sanlian Group Others Total
Source:
2008 1.5 1.7 0.6 0.5 0.5 0.3 0.3 0.2 0.2 0.3 0.3 0.1 0.1 0.1 0.2 0.2 0.1 0.1 0.0 0.1 0.2 92.2 100.0
2009 1.6 1.5 0.6 0.5 0.4 0.3 0.3 0.2 0.2 0.3 0.3 0.2 0.2 0.1 0.2 0.1 0.1 0.1 0.1 0.1 0.1 92.4 100.0
2010 1.7 1.6 0.6 0.5 0.5 0.3 0.3 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.1 0.2 91.9 100.0
2011 1.7 1.6 0.6 0.6 0.5 0.3 0.3 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.1 0.2 91.4 100.0
2012 1.6 1.3 0.6 0.6 0.5 0.3 0.3 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 91.7 100.0
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 23
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% retail value rsp excl sales tax Brand Company Suning Gome Hisap Dashang, Newmart Parkson Wangfujing Golden Eagle Five Star Intime Dashang Watson's Your Personal Store Laomiao, First Asia Chow Tai Fook Maoye Van's Department Store Silver Plaza Rainbow New World Metersbonwe Xinhua Bookstore Others Total
Source:
2009 1.6 1.5 0.4 0.3 0.3 0.3 0.2 0.3 0.2 0.3 0.2 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.2 93.2 100.0
2010 1.7 1.6 0.5 0.3 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.1 0.2 0.1 0.1 0.1 0.2 92.8 100.0
2011 1.7 1.6 0.5 0.4 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.1 0.2 0.2 0.2 0.2 0.2 92.3 100.0
2012 1.6 1.3 0.5 0.4 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 92.6 100.0
Suning Appliance Co Ltd GOME Electrical Appliances Holding Ltd Hisap High Technology Corp Dashang Group Parkson Retail Group Ltd Beijing Wangfujing Department Store Co Ltd Golden Eagle Retail Group Ltd Jiangsu Five Star Appliance Co Ltd Intime Department Store (Group) Co Ltd Dashang Group Watson (Group) HK Ltd, AS Shanghai Yuyuan Tourist Mart Co Ltd Chow Tai Fook Jewellery Group Ltd Maoye International Holdings Ltd Van's Department Store Co Ltd Silver Plaza Group Co Ltd Rainbow Department Store Co Ltd New World Department Store China Ltd Metersbonwe Group Zhejiang Xinhua Bookstore Co Ltd
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 24 sites/outlets Brand 361 Degrees Tong-Jun-Ge Peak Anta Xtep Li Ning Nike adidas Tong-Ji-Tang
Company 361 Degrees International Ltd Chongqing Tongjunge Drugstores Co Ltd Peak Sport Products Co Ltd Anta (China) Co Ltd Xtep International Holdings Ltd Li Ning Co Ltd Nike (China) Inc adidas Sports (China) Ltd Hubei Tong-Ji-Tang
2009 6,693 7,102 6,206 6,591 6,103 7,249 5,157 4,381 4,486
2010 7,263 7,506 7,224 7,549 7,031 7,915 5,085 4,491 4,452
2011 7,865 7,955 7,806 7,778 7,596 8,255 5,477 4,910 4,800
2012 8,425 8,365 8,206 7,988 7,946 7,280 5,658 5,180 5,000
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Daphne Metersbonwe Septwolves Shiseido Baleno Belle Lilang Yishion Tupperware Jeanswest Kappa Avon Others Total
Source:
Drugstores Co Ltd Daphne International Holdings Ltd Metersbonwe Group Fujian Septwolves Industry Co Ltd Shiseido (China) Investment Co Ltd Texwinca Holdings Ltd Belle International Holdings Ltd China Liliang Ltd Dongguan Dongyue Caparison Co Ltd Tupperware China Co Ltd Glorious Sun Enterprises Ltd China Dongxiang Group Co Ltd Avon (China) Co Ltd
3,307 2,778 3,249 3,288 3,686 2,160 2,561 3,024 3,010 2,341 3,511 6,000 1,628,653 1,721,536
3,789 3,385 3,525 3,759 3,830 2,618 2,885 3,235 3,100 2,705 3,751 2,100 1,773,040 1,870,238
4,229 4,164 3,976 3,985 4,007 3,286 3,268 3,395 3,300 2,956 3,119 1,913,985 2,016,112
4,639 4,634 4,376 4,225 4,142 3,686 3,588 3,535 3,500 3,176 3,039 2,048,180 2,154,768
Euromonitor International from official statistics, trade associations, trade press, company research, trade interviews, trade sources
Table 25
RMB bn, retail value rsp excl sales tax 2012 Store-based Retailing Non-Store Retailing Retailing
Source:
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
Table 26
% constant value growth, retail value rsp excl sales tax 2012-17 CAGR Store-based Retailing Non-Store Retailing Retailing
Source:
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
Table 27
RMB bn, retail value rsp excl sales tax 2012 2013 2014 2015 2016 2017
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Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
Table 28 outlets
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
Table 29
% constant value growth, retail value rsp excl sales tax 2012-17 CAGR Grocery Retailers Non-Grocery Retailers Store-based Retailing
Source:
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
Table 30
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
Table 31
RMB bn, retail value rsp excl sales tax 2012 Direct Selling Homeshopping Internet Retailing Vending Non-Store Retailing 79.4 29.1 405.9 5.6 520.0 2013 88.5 34.2 577.1 6.1 705.9 2014 97.5 40.0 801.7 6.6 945.8 2015 106.4 46.7 1,052.5 7.1 1,212.7 2016 114.9 54.4 1,249.3 7.6 1,426.1 2017 124.2 63.1 1,475.2 8.1 1,670.6
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Source: Note:
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Vending data captures vending systems installed in public and semi-captive environments only. For further details refer to definitions.
Table 32
% constant value growth, retail value rsp excl sales tax 2012-17 CAGR Direct Selling Homeshopping Internet Retailing Vending Non-Store Retailing
Source: Note:
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Vending data captures vending systems installed in public and semi-captive environments only. For further details refer to definitions.
Table 33
RMB bn, retail value rsp excl sales tax 2012 Apparel Specialist Retailers Electronics and Appliance Specialist Retailers Health and Beauty Specialist Retailers Home and Garden Specialist Retailers Leisure and Personal Goods Specialist Retailers Mixed Retailers Other Non-Grocery Retailers Non-Grocery Retailers
Source:
487.5 855.3
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
Table 34 outlets
2012 Apparel Specialist Retailers Electronics and Appliance Specialist 512,773 53,951
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Retailers Health and Beauty Specialist Retailers Home and Garden Specialist Retailers Leisure and Personal Goods Specialist Retailers Mixed Retailers Other Non-Grocery Retailers Non-Grocery Retailers
Source:
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
Table 35
% constant value growth, retail value rsp excl sales tax 2012-17 CAGR Apparel Specialist Retailers Electronics and Appliance Specialist Retailers Health and Beauty Specialist Retailers Home and Garden Specialist Retailers Leisure and Personal Goods Specialist Retailers Mixed Retailers Other Non-Grocery Retailers Non-Grocery Retailers
Source:
2012/17 TOTAL 68.0 45.4 46.8 49.9 64.7 57.7 45.2 52.9
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
Table 36
% unit growth 2016/17 Apparel Specialist Retailers Electronics and Appliance Specialist Retailers Health and Beauty Specialist Retailers Home and Garden Specialist Retailers Leisure and Personal Goods Specialist Retailers Mixed Retailers Other Non-Grocery Retailers Non-Grocery Retailers
Source:
2012-17 CAGR 7.8 7.4 4.8 5.1 6.7 5.0 2.4 5.6
2012/17 Total 45.8 42.6 26.3 28.3 38.3 27.9 12.9 31.6
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
APPENDIX
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Operating Environment
Foreign direct investment in retail China has issued a series of laws, regulations and ordinances with regard to foreign direct investment, based on the following statutes: Law of the Peoples Republic of China on Chinese-foreign Equity Joint Ventures (promulgated in 1979 and amended in 1990 and 2001); Peoples Republic of China Foreign-funded Enterprise Laws (promulgated in 1986 and amended in 2000); and the Law of the Peoples Republic of China on Chinese-foreign Contractual Joint Ventures (promulgated in 1988 and amended in 2003). The following laws, regulations and ordinances set the current legislative framework for foreign direct investment: Interim Provisions for Submission and Approval Procedure on Electric Power Project Invested Directly by Foreigners (1996); Circular of the State Administration of Foreign Exchange on Relevant Issues Concerning the Registration of Foreign Exchange by Direct Foreign Investment (2002); Circular of the State Administration of Foreign Exchange on Improving the Administration of Foreign Exchange by Foreign Direct Investment (2003); Circular of the Ministry of Commerce and the State Administration of Foreign Exchange concerning Further Strengthening and Standardising the Examination and Approval of Foreign Direct Investment in the Real Estate Industry (2007). China fully opened its retail market in 2004 following its accession to full membership of the World Trade Organization (WTO). China has promulgated a series of relevant laws and regulations since 2004, including Measures for the Administration on Foreign Investment in Commercial Fields (2004), Regulations on Direct Selling Administration (2005), Measures for the Administration on Sales Promotion Acts of Retailers (2006), Measures for the Administration of Fair Dealing of Retailers and Suppliers (2007) and Regulations on Administering Commercial Franchises (2007). These legislative enactments represent an attempt to boost growth in retailing and build up an orderly, standardised and highly efficient market-oriented retail environment. Due to the strong confidence in Chinas long-term economic prospects, foreign direct investment in retailing continues to increase in China. By the end of August 2009, the total number of foreign investment companies reached 2,400, and the total investment capital in China surpassed US$4.8 billion. Informal retailing Informal retailing still represents a considerable proportion of value sales in retailing in China, especially in regions where formal retailing has yet to penetrate fully, such as rural areas. However, with the execution of several retailing reforms in rural areas since February 2005, which aimed to establish a cohesive distribution network in rural China, informal retailing is expected gradually to lose ground, although it will still co-exist with formal retailing in a complementary role for some time yet. Opening hours Retail outlets in Chinas urban areas are normally open from 09:00-18:00hrs, although supermarkets and hypermarkets often operate longer business hours, as long as 14 hours a day, in addition to 24-hour opening for convenience stores and forecourt retailers. Retail outlets in rural areas tend to have shorter opening times than those in urban areas. The majority of retail outlets in urban areas are open seven days a week and 365 days a year, even on public holidays. This is because public holidays are usually peak times for shopping.
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Retail landscape High-end shopping areas are usually found in Chinas major cities, with premium department stores, shopping malls and apparel stores more commonly strategically located in areas of high foot traffic. Luxury retailers tend to be located on the high streets of Chinas major cities, such as Huaihai Road and Nanjing Road (West) in Shanghai, whereas discount retailers are usually based in residential neighbourhoods and suburban areas. Shopping malls are an increasingly popular phenomenon in China. These one-stop retail centres cater to many different consumer needs. For example, grocery shopping can be done in a supermarket or hypermarket, foodservice outlets are available for those who wish to have a meal, and shoppers can visit the cinema. Shopping malls attract a large number of consumers in China, especially during weekends and public holidays.
Cash and Carry: Number of Outlets by National Brand Owner 2009-2012 Brands 2009 2010 2011 2012
42
43
53
61
Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources
DEFINITIONS
This report analyses the market for Retailing in China. For the purposes of the study, the market has been defined as follows: Store-based retailing Grocery retailers Modern grocery retailers Convenience stores Discounters Forecourt retailers: chained forecourt retailers; independent forecourt retailers
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Hypermarkets Supermarkets Traditional grocery retailers Independent small grocers Food/drink/tobacco specialists Other grocery retailers Non-grocery retailers Apparel specialist retailers Electronics and appliance specialist retailers Health and beauty specialist retailers Chemists/pharmacies Parapharmacies/drugstores Beauty specialist retailers Other healthcare specialist retailers Home and garden specialist retailers Furniture and homewares stores Home improvement and gardening stores Leisure and personal goods specialist retailers Jewellery and watch specialist retailers Media product stores Pet shops and superstores Sports goods stores Stationers/office supply stores Traditional toys and games stores Other leisure and personal goods specialist retailers Mixed retailers Department stores Variety stores Mass merchandisers Warehouse clubs Other non-grocery retailers Non-store retailing Vending Homeshopping Internet retailing Direct selling Terminology: GBO refers to global brand owner, which is the ultimate owner of a brand. NBO refers to national brand owner, which is the company licensed to distribute a brand on behalf of a GBO. The NBO may be a subsidiary of a GBO or it may be a completely separate company. Share tables at both GBO and at NBO level are provided in the report. Reference to shares in the report analysis is at NBO level.
SOURCES
Sources used during the research included the following:
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National Bureau of Statistics of China CAPA China Chain Store & Franchise Association China Direct Selling China Toys Association China Vending China Xinhua Bookstore Association Shanghai E-commercial Association
Trade Press
Source: Euromonitor International
TVSM
Euromonitor International