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China retail market undergoing fundamental changes to cater to affluent customers

Press release June 20, 2014 Retailing in China, Retail Industry China, China Retail Market Reports

The report provides a detailed analysis of both the historic and forecast market data of retail sales of different product segments across key channels in China.

The retail markets in China have lately been under a lot of scrutiny, given that there are major changes that the market is going through. One of the major factors that is driving the growth of Chinese retail sales, is the strong economic growth and the country’s constant efforts to become one of the global leaders among consumer led economies. Furthermore, the retail industry in China has noted the change in shopping trends from being functional to more emotional and status driven, which has created new opportunities for both segments of products - premium as well as value for money brands. Besides, the drive of Chinese retailers to create a strong market presence acts as another key factor that is expected to fuel the market’s stupendous growth in the next 5 years. Research suggests that globally as well as in China specifically, online retail has witnessed more sales than traditional brick and mortar shops, over the last few years. Increased consumer awareness about the international fashion brands has further opened up numerous opportunities for international players and value-led brands in clothing and footwear segments to expand retailing to China. Consequently, the jewelry, watches and accessories segments are also expected to witness increased competition thus leading to better deals for the consumers.

This report: Retailing in China – Market Summary and Forecasts: Comprehensive overview of the market, consumer, and competitive context, with retail sales value and forecasts to 2018 provides a comprehensive analysis of the emerging trends, forecasts and opportunities in China's retail market. The overall retail value sales of retailing saw a double digit growth last year, despite the slowdown in China’s macroeconomic performance. Additionally, despite the slow economic growth, the disposable income level of consumers continued to rise supporting the healthy sales growth in retailing.

Growth of the online retail sector

The retail market is fast evolving and with higher incomes and increasing affluence, the consumers are now demanding better quality products and services. New technologies are further revolutionizing the way retailers operate their business, where most of them are seen to prefer virtual platforms since they seem to be far most cost-effective. Discounted rates of items, convenience of door-to-door delivery, extensive product portfolios and improved quality items and services have further driven them towards doing business through online models. Furthermore, as key vendors of the retail markets collaborated with online retailers, online retailers were also seen investing in methods to improve end-user’s shopping experience in return, fuelling sales further.

Challenges of the retail market of China

Despite the growth opportunities present in China’s retail market, challenges remain, which have thwarted the market. According to a study of the China retail industry report the increased operating costs squeeze the profit margins to a bare minimum. Furthermore, duplicated investment in some cities, lack of proper infrastructure and mismanagement leading to poor customer footfall, an uneven trade mix, commercial disputes and high vacancies that affected the market in an adverse manner. With the increased competition alongside demanding consumer groups looking for the best-possible deals, retail operators who are constantly innovating and improving their business practices are the ones who are emerging as winners of this sector.

For further insights,

Visit: China retail market undergoing fundamental changes to cater to affluent customers

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Subjects


Retailing in China, Retail Industry China, China Retail Market Reports


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