Market research: Foreign supermarkets in China

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Three supermarket giants meeting in one city 

Tesco, Wal-Mart and Carrefour, the three behemoths of the global retail industry, have all opened supermarkets in Shenyang, the capital city of the Liaoning province in North-east China, making it one of only a small number of cities in the world where these three retailers compete with each other. Tesco’s atmosphere are more akin to a traditional wet market than a supermarket. Employees of Tesco are known for shouting at their customers to draw attention, “essentially hawking” these customers, says Mr. Ken Towle, the president and chief executive officer of Tesco’s Chinese operations. Tesco has a “secret weapon” in its bid to conquer China, Towle added. The chain has launched Membercard, the equivalent of its Clubcard, in the country. It already has 4.5 million members (out of a total of 6.5 million Tesco shoppers). Members are offered targeted discount promotions. The Membercard data is crucial to Tesco’s local management, allowing them to understand the “language” of shopping in a land where they cannot speak the actual language.

British supermarkets a hit with Chinese shoppers

British dishes such as baked beans and cream of mushroom soup have proven popular with Chinese shoppers at Marks & Spencer’s flagship store in downtown Shanghai. Shoppers are also stocking up on frozen salmon and cod fillets, frozen curries, chocolate-chip cookies and porridge oats. “We’re even selling tea to the Chinese – they like the more interesting infusions,” said Stephen Rayfield, M&S China country manager.

Another UK chain, Tesco, already has more than 100 stores in China, while Sainsbury’s is also believed to be in talks with a potential partnership to enter the Chinese market. Chinese eating habits are starting to mimic Western ones, with the country’s growing middle class increasingly eating cereals for breakfast, rather than rice, and using teabags, rather than traditional tea leaves.

New trends of foreign supermarkets: medicines retailing in Wal-Marts and Carrefour

Wal-Mart, the world’s largest retailer, has gained approval to sell a full range of over-the-counter medicines in some of its stores in China.

Some Wal-Marts in Shenzhen, a city in the southern Guangdong province, have been selling a limited variety of medicines, mainly vitamins and dietary supplements, since late last year. Now, these stores are authorized to stock all drugs that can be sold beyond the pharmacy channel. The move flags the beginning of a full-scale transition to cheaper, more accessible healthcare in China which should stimulate consumer acceptance of and demand for self-medication. Wal-Mart is expected to pursue medicines retailing in its other outlets throughout China. Carrefour, the second largest retail chain in the world, is also planning on acquiring a license to offer over-the-counter medication.

Daxue Consulting Market Research in China

Sources:

Picture Source: Wal-Mart China

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