Since the 1990s, driven by the reform of the distribution system and the opening up to the outside world, China's retail industry has made amazing achievements after more than 10 years of development. By 2003, the retail sales of goods in the wholesale and retail industry reached RMB 376.93 billion, an increase of 5.5 times over 1991, with an average annual growth rate of 15%; by 2003, the total retail sales of consumer goods in the country had reached RMB 458.42 billion, an increase of nearly five times over 1991. While the scale of the industry is rapidly increasing, the industry structure of China's retail industry has also undergone great changes. The industry structure dominated by a single department store has developed into a diversified industry structure with department stores, supermarkets, warehouse stores and specialized stores co-existing. Since December 11, 2004, China's retail market has been fully opened up, which has also led to the entry of a large number of foreign-funded retail enterprises into China, which directly affects the Chinese retail enterprises to actively introduce and absorb the advanced management methods and business concepts of the developed countries, so that the modernization level of China's retail industry is constantly improving. Specifically, it seems that China's retail industry is characterized by:
Rapid increase in the scale of retail industry
The total retail sales of consumer goods in 2003 reached 4,584.2 billion yuan, which is nearly five times higher than that in 1991. Among them, retail sales of consumer goods in cities amounted to 2977.7 billion yuan, with an average annual growth rate of 17%; retail sales of consumer goods in counties and sub-counties amounted to 1606.5 billion yuan, with an increase of 13%. By industry, retail sales in wholesale and retail trade amounted to 376.93 billion yuan, an increase of 15%; retail sales in the catering industry amounted to 606.6 billion yuan, an increase of 123%; and retail sales in other industries amounted to 208.3 billion yuan, an increase of 0.3%. The total retail sales of consumer goods grew steadily, and the retail sales of some commodities grew very rapidly, becoming some of the bright spots in the retail market. Among the sales of wholesale and retail trade above the limit, the retail sales of automobiles increased by 68.5% over the previous year, communications equipment by 70.9%, household electrical appliances and audio-visual equipment by 18.3%, and furniture by 28.2%.
From the point of view of the top 100 retailers, merchandise sales and the average size of merchandise sales grew rapidly. Compared with 2001, the total merchandise sales of the Top 100 retail enterprises in 2002 increased by 23.6% and the retail sales of merchandise increased by 26.8%, with the retail sales growth rate being 16.3% higher than that of the total retail sales of consumer goods.The average merchandise sales per enterprise of the Top 100 retail enterprises in 2002 was RMB 28.95 yuan, and the retail sales amounted to RMB 2.413 billion yuan, which is respectively RMB 553 million yuan and RMB 5.1 billion yuan higher than that in 2001.
From the perspective of the Top 100 retail enterprises, merchandise sales and retail sales grew rapidly. 553 million yuan and 510 million yuan respectively.
Development of old and new formats
Before opening up to the outside world, China's retail market had long maintained a single pattern of domination by department stores, which had a market share of more than 60%. Since the opening up to the outside world, with the changes in consumer demand and the intensification of competition in the retail market, new retail formats such as large supermarkets, supermarkets, convenience stores, specialty stores, specialty stores, home centers, and warehousing stores have been developing rapidly, and have become the main driving force for the expansion of the scale of China's retail industry. Among the top 100 retailers in 2003, 47% of the retailers were mainly supermarkets, specialty stores and other new retail formats, and their total merchandise sales increased by 42.2% year-on-year, 24.4% higher than the growth rate of retailers mainly in the department store format.
Despite the huge impact of new retail formats, department stores have not disappeared, but have entered a period of adjustment and transformation, and continue to maintain their position as the main format in China's retail market. Department stores will be the original low- and medium-grade goods and hardware and home appliances and other goods will be shunted out, focusing on doing boutique, branded, high-margin, low-turnover department stores, reflecting the department store's sense of hierarchy, sense of fashion, and lead the trend of fashion changes. The proportion of department store retailers in the total retail sales of consumer goods in the whole society is still steadily increasing, and the absolute speed of their development is still maintained at a high level. Among China's top 100 retailers in 2003, department store-type enterprises still accounted for 53%, and department stores remain an important force in China's retail industry.
Increased market concentration
Since the opening up to the outside world, China's top 100 retailers have grown rapidly, with their market share gradually concentrating on the dominant enterprises. 2001, the top 100 retailers accounted for 5.06% of total retail sales of consumer goods, and in 2002, they increased by 0.87 percentage points to 5.93%. 2003 sales of China's top 100 retailers amounted to 412.98 billion yuan, an increase of 56.2% over 2002, accounting for 9% of total retail sales of consumer goods in that year, an increase of 2 percentage points over 2002. The proportion of total merchandise sales of the top ten retail enterprises to the total merchandise sales of the Top 100 Retail Enterprises in 2002 was 38.8%, an increase of 4.7 percentage points over 2001. The increase in market concentration in the retail industry will not only play a role in stabilizing the market, but will also bring about an adjustment in the relationship between industry, commerce and consumers.
Modernization of retail industry improves
In recent years, the modernization level of China's retail industry has improved significantly. In addition to the faster development of modern circulation methods and new retail formats, what is more important is the rapid promotion of advanced circulation operation and management technologies. Beijing, Shanghai, Guangdong and other places promote advanced circulation operation and management technology, develop modern circulation, more than 90% of large and medium-sized shopping malls have established point-of-sale management system (POS), more than 50% of large and medium-sized shopping malls have applied bar code technology, a large number of retail enterprises have set up management information system (MIS), and actively apply the electronic data interchange system (EDI) and the Internet (INTERNET) and other modern information technology to promote enterprise informatization. A large number of retail enterprises have set up management information systems (MIS), actively applied electronic data interchange systems (EDI) and the Internet (INTERNET) and other modern information technologies, and pushed forward the construction of enterprise informationization and e-commerce, which have greatly improved the level of management and lowered circulation costs. A number of retail enterprises with a high level of modernization have emerged.
Foreign investment in a big way
According to statistics, from 1992, as of September 2003, the country's cumulative actual utilization of about 3 billion U.S. dollars in foreign capital, approved the establishment of 264 foreign-funded commercial enterprises, more than 2,200 outlets, located in more than 20 provinces and cities in the country, mainly concentrated in large and medium-sized cities, such as Shanghai, Beijing, Shenzhen, Guangzhou, Nanjing, Hangzhou and so on. Most of the world's top 50 large-scale retailers have already occupied a place in China, and well-known retail giants such as Wal-Mart of the U.S., Carrefour of France, Metro of Germany, Ito-Yokado of Japan, etc. have gradually formed a certain network scale in China. the retail sales of foreign-funded retail enterprises accounted for about 1.5% of the country's total retail sales in 1998, and grew to about 3% in 2000.
Chinese retailers are now the largest in the country.
Problems in China's retail industry
Along with the rapid development of the retail industry, problems in China's retail industry have also been emerging, as follows:
Small scale of enterprises
From the perspective of the retail structure as a whole, China's retail structure is characterized by the predominance of small-scale stores, especially the proportion of individual stores is as high as 92%, and the average number of employees per individual store is only 1.75. The average number of employees per individual store is only 1.75. Even for large retailers, the size of their organizations is still small: the average size of retailers above the quota was 94 persons in 2001, while the average size of foreign-funded enterprises in China was more than 220 persons in the same period. Compared with Wal-Mart, Shanghai Hualian, a Chinese retail enterprise, there is a considerable gap between its scale of operation and profitability. From the chain management point of view, the fastest growing chain management of the United States, its chain management has accounted for more than 80% of the national retail sales, while China's share of this proportion is only about 25%. This small-scale operation of retail enterprises has seriously hindered the realization of the advantages of scale operation in the retail industry.
Rapidly expanding expansion
The rapid expansion of Chinese retailers is mainly manifested in the expansion of retail outlets, but at the same time, the growth of the efficiency of the operation of individual stores and unit area has been neglected. Comparing the expansion performance of Carrefour and Lianhua in recent years, it can be seen that: Carrefour's average annual growth rate of sales from 1998 to 2000 was as high as 77%, and the rate of new store opening was only 24% per year, with the average annual growth rate of sales revenue per store as high as 28%; Lianhua's average growth rate of store opening was as high as 89% during the period of 1995 to 2000, despite the fact that the growth of sales revenue was also as high as 69% per year. , which also meant that average sales per new store decreased by more than 10% per year. This suggests that in a total high-growth market environment, the potentially synchronized growth effect of single-store revenues appears to have been completely offset by the potential decline in average revenues from new store openings. Such blind expansion will constrain the growth of retailers under open-door conditions.
Unsatisfactory economic performance
While the market size of China's retail industry is expanding rapidly, the economic performance of retail enterprises has not maintained a synchronized growth. In terms of the profitability of retail enterprises above the quota, the total realized profit reached the bottom in 1998, with a net loss of 0.03 billion yuan for the whole industry, and the total profit rebounded to 5.43 billion yuan in 2002, but the profitability of the enterprises still has not recovered to the level prior to the mid-1990s. Looking at the profit level of enterprises, the gap is even more obvious. the sales profit margin of retail enterprises above the quota was only 0.84% in 2002, which was still lower than the level of 0.9% in 1996, while it was 2.25% in 1994 when the enterprises had better efficiency. The problem of poor efficiency has become an important obstacle to the sustainable development of the retail industry.
Regional Gap Expanding
Subject to the combined influence of policy, natural conditions, economic foundation and labor quality, the regional gap in the development of China's retailing industry is still expanding.In 2002, the retail sales volume of wholesale and retail merchandise in the eastern region was 174.816 billion yuan, an increase of 1.1 times than that of 1995, with an average annual growth rate of 11.3%, and the proportion of the whole country was 61.8%, with a proportion of 2 percentage points higher than that of 1995; in the central region, it was 748.76 billion yuan, one times higher than that of 1995, with an average annual growth rate of 10.6%, accounting for 26.5% of the country, with a proportion of 0.3 percentage points lower than that of 1995; and in the western region, it was 332.91 billion yuan, with an increase of 79.3% over that of 1995, with an average annual growth rate of 8.7%, accounting for 11.8% of the country, a proportion of 1.7 percentage points lower than in 1995.
From the benefits of retail enterprises in different economic zones, in 2002, retail enterprises above the quota in the eastern region realized a total profit of 5 billion yuan, accounting for 92.1% of retail enterprises above the quota in the country, with the proportion of 13.6 percentage points higher than that of 1994; while in the central region, it was a net loss; and in the western region, it realized a total profit of 470 million yuan, accounting for 6.7% of the country, with the proportion of 3 percentage points higher than that of 1994; and in the central region, it was a net loss. 1994, an increase of 3 percentage points. This shows that the profitability of retail enterprises in the eastern region is still stronger than that of the other two regions.
The development trend of China's retail industry
To take the road of scale operation
Currently, there is a certain gap between the scale of China's retail enterprises and that of developed countries, and an important way for the retail industry to realize "low-cost, high-profit" operation is to implement scale operation. The world's top 100 retailers are all models of large-scale development, ranking in the top 10 enterprises have more than 1,000 stores. The world's largest commercial chain Wal-Mart, currently in the world **** has 4,150 stores, in 2001 with sales revenue of 217.8 billion U.S. dollars, the results of the "Fortune" 500 champions.
Throughout the world's top 100 retail enterprises, through mergers and acquisitions, take the road of joint operations, chain operations, is to achieve a shortcut to enterprise scale. As the Chinese government is mulling the introduction of the Urban Commercial Network Regulations, coupled with the fact that many large urban retail stores in China are already in a saturated state, new stores are bound to intensify regional competition, and thus mergers and acquisitions will become an important way of expanding China's retail market. At the same time, almost all of the world's famous large-scale retail enterprises have adopted the chain operation method. Since most retail formats can exist in the form of chain operation, chain operation will become a new development trend in the retail industry.
New retail formats will be further developed
New retail formats such as large supermarkets, food-based supermarkets, and specialty stores will be further developed, and discount stores and shopless sales will quietly emerge. Although the development of large-scale integrated supermarket format in China's first and second class cities has been restricted, large-scale integrated supermarkets in the next few years in the more economically developed cities in the central and western parts of the country, where local products are more abundant, will show a rapid growth trend. Supermarkets focusing on the sale of fresh commodities and processed foods have a tendency to increase the development of stores of more than 1,000 square meters in the future. In the professional store, in addition to home appliances professional store, building materials professional store, medical professional store, glasses professional store, office supplies professional store, home accessories professional store, sporting goods professional store, etc. will have a big development. Discount store format, some of the strength of the chain or brand of food processing enterprises, food wholesalers, etc., is an extremely attractive new format, especially in the new retail business is less developed or more development potential in small and medium-sized cities. No store sales business will be with the changes in market demand and China's marketing technology to improve the development trend.
Scientific management and advanced technology become the core
Most of the world's top 100 retailers have adopted advanced technology to automate business management. Retail enterprises widely use e-commerce systems, such as commercial electronic data processing systems, customer relationship management systems, management information systems, decision support systems, to form a business automation management mode by means of information processing. Business management automation penetrates into all aspects of the enterprise's purchasing, selling and storing business, thereby improving the efficiency of commodity circulation, reducing operating costs and enhancing enterprise competitiveness. The experience of the world's top 100 retail enterprises shows that scientific management technology represented by information technology represents the direction of the development of modern retail industry. The development of China's retail enterprises must also follow this law, and in the next few years, scientific management will become the main means of development for China's retail enterprises.
Foreign Capital Share Continues to Expand
Since China implemented the opening up of the retail industry to the outside world in 1992, foreign-funded retail enterprises have completed their strategic deployment in China at an astonishing speed and captured a certain market share. on December 11, 2004, China will abolish restrictions on foreign-invested commercial enterprises in terms of geography, shareholding and number of enterprises, and further expand the commercial sector's opening up the commercial sector to the outside world. By that time, foreign investors will enter the market in a big way and will continue to expand their retail market share in China by virtue of their advantages in strategic management, process management and retail formats.
The total retail market of consumer goods grew steadily in 2004, with total retail sales reaching 5,395 billion yuan, an increase of 13.3% over the previous year, and a real growth of 10.2% after deducting the factor of price increase. The structural gap between urban and rural areas and between regions continued to widen. 2004 urban retail sales of consumer goods amounted to 355.73 billion yuan, an increase of 14.7%, while the retail sales of consumer goods in counties and sub-counties amounted to 183.77 billion yuan, an increase of 10.7%.
In the first half of 2005, China's 100 key large-scale retail enterprises maintained a steady growth momentum, completing total merchandise sales of 87.98 billion yuan, up 17.5% year-on-year, and retail sales of 73.6 billion yuan, up 18.3% year-on-year. In the twenty-eight categories of commodities counted, *** there are twenty-four categories of commodities retail sales increased year-on-year, and twenty-one categories of commodities retail sales growth are more than ten percent.