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Retailing in China

China retailing market: Highly fragmented industry

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2014-03-11 03:45:03 - Retailing in China - a new market research report on

Overall, the China retailing market remained vigorous in 2012, with double-digit current value growth. The central government´s 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.

Growth in retailing slowed slightly in 2012, mainly thanks to the decelerating economy in China amid the uncertain global economic outlook, particularly the worsening Europe sovereign debt crisis. Categories which particularly suffered included electronics and appliance specialist retailers, whose growth halved in 2012 compared to 2011. This category has also faced the end of two household appliance subsidy programmes, which



previously contributed significantly to its robust growth.

Compared with the relatively mature grocery retailing, non-grocery retailing seems to have greater market potential, with its current value growth outperforming grocery retailing significantly in 2012 over 2011. Many non-grocery retailing channels are comparatively underdeveloped in China with less presence of multinational players in the market. Internet retailing and homeshopping both registered dynamic current value growth in 2012.

The retailing market in China is highly fragmented. Owing to the boom in internet retailing, leading internet retailers, such as and, have experienced explosive growth in sales revenue and quickly risen to the top 10 position in the retailing market over the review period. An extensive range of products for sale, convenient home delivery service with efficient logistics facilities and extremely competitive prices are key factors in their rocketing growth.

Value growth of retailing in the forecast period is expected to remain strong over the forecast period, driven mainly by the government´s strategic focus on boosting domestic demand as the major growth engine for the Chinese economy. Stimulus packages are expected to continue to be launched to promote consumption and support the healthy growth of retailing. Rising disposable incomes and the pursuit of better lifestyles among Chinese consumers are also expected to underpin the strong forecast value growth of retailing.

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