Foreign Supermarkets Still Value Three Or Four Line Cities

Reporters learned that Carrefour Xiaoshan Jincheng store announced that it will stop operating. This is also the second store that Carrefour has closed in Zhejiang within one year following the closure of Ningbo Carrefour bridge shop in April.

It is reported that there are 6 Carrefour stores in Zhejiang, the smallest since 2011.

According to the insiders, after a few years of blind expansion, foreign supermarkets have entered a period of adjustment. Some foreign enterprises are not accurate enough to control the local market. In order to reduce costs, they will inevitably close those shops with insufficient profitability.

Reporters then called the relevant departments of Carrefour East China District, the other side said that Carrefour Jincheng store closed in September 17th is a normal business behavior.

Reporters noted that since the opening of Ningbo Jiangdong store in Carrefour in 1999, Carrefour has opened 9 stores in Hangzhou, Ningbo, Shaoxing, Jiaxing and Wenzhou in 15 years. In addition to the two stores closed this year, Carrefour Shaoxing Jinghu shop was closed in 2012 as early as in 2012.

Hu Chuncai, general manager of Shanghai Shangyi consulting, thinks that taking Carrefour as an example, the traditional retail hypermarkets are facing the sharp changes in the industry, especially the impact of electricity providers. The decline of competitiveness is an indisputable fact.

At present, the first and second tier cities with more developed economy, the maturity of community supermarkets and the excessive competition of the same type of formats are also the reasons for the increase in the exit of foreign supermarkets.

In addition, in the industry view, the rising cost of retail business is also a major factor leading to the difficulties of retail business.

"Many retail businesses are in the form of leasing, and the average selling time is 10~15, which is the peak of property maturity."

According to the "statistics of key retail enterprises closing statistics in the first half of 2014" released by Lian Shang net, 146 large supermarkets in the country were closed, of which 118 were foreign-funded retail enterprises, accounting for 75% (including Sino foreign joint ventures).

The industry believes that the blind market competition from the past.

Compared to the future, the new stores will no longer become a single standard to consider enterprises. Optimizing the stores and improving the industrial chain structure will become the mainstream work this year.

Although the development of foreign supermarkets in China is facing "acclimatization", the confidence of foreign supermarkets does not appear to have declined.

Tang Jianian, vice president of the group and President of Carrefour Greater China, once said that the most fundamental reason for the closing of shops in China's hypermarkets is not ready for rapid expansion, mostly due to the failure of site selection.

At the same time, Tang Jianian said that the Chinese market is still full of confidence, the future will be expanded 20 to 22 new stores every year, striving to cover 100 cities in 3 years, and is ready to devote more human resources to the Midwest.

Hu Chuncai said, despite hypermarkets

The recent situation in the Chinese market is really bad, but there are still opportunities for expansion in the three or four tier cities.

"The first and second tier cities in the eastern part of the world have a high degree of market saturation, and more foreign supermarkets are turning their attention to the three or four tier inland cities. With the promotion of China's urbanization strategy and the sustained economic development, the retailers who are steadily expanding and operating in a stable and self-sustaining property will be profitable."