Development of the grocery retail market in China: a qualitative study of how foreign and domestic retailers seek to increase market share

Hingley, Martin and Lindgreen, A. and Chen, L. (2009) Development of the grocery retail market in China: a qualitative study of how foreign and domestic retailers seek to increase market share. British Food Journal, 111 (1). pp. 44-55. ISSN 0007-070X

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Official URL: http://dx.doi.org/10.1108/00070700910924227

Abstract

Purpose – The purpose of this paper is to investigate the development of the grocery retail market in
China. International retailers have been in China for more than ten years, during which period a series
of profound changes has occurred in the Chinese retail sector. International retailers introduced
advanced retail techniques and managerial approaches; domestic retailers grew more sophisticated in
their supply chain management. Foreign-based retailers in China can compete in hypermarket and
supercentre formats because they offer higher-quality products and achieve larger economies of scale.
Domestic retailers compete by operating smaller formats and maintaining good relationships with
governments and local communities. However, formerly state-owned domestic retailers appear less
competitive because they lack funds and adopt poor management styles. This study aims to make
recommendations about future developments by domestic and foreign grocery retailers.
Design/methodology/approach – The paper takes the form of a qualitative study involving
in-depth interviews with four retailers: Wal-Mart, Bonjour, Wu-Mart, and Jingkelong.
Findings – The findings pertain to several different themes, including consumers, business
relationships and distribution centres, product lines, store formats, quality systems, and competition.
Research limitations/implications – The study’s findings are based only on four retailers.
Practical implications – The paper presents a series of recommendations for both foreign-based
and domestic retailers.
Originality/value – This research is among the first to investigate operator attitudes toward
competition in the grocery retail market in China.

Item Type:Article
Additional Information:Purpose – The purpose of this paper is to investigate the development of the grocery retail market in China. International retailers have been in China for more than ten years, during which period a series of profound changes has occurred in the Chinese retail sector. International retailers introduced advanced retail techniques and managerial approaches; domestic retailers grew more sophisticated in their supply chain management. Foreign-based retailers in China can compete in hypermarket and supercentre formats because they offer higher-quality products and achieve larger economies of scale. Domestic retailers compete by operating smaller formats and maintaining good relationships with governments and local communities. However, formerly state-owned domestic retailers appear less competitive because they lack funds and adopt poor management styles. This study aims to make recommendations about future developments by domestic and foreign grocery retailers. Design/methodology/approach – The paper takes the form of a qualitative study involving in-depth interviews with four retailers: Wal-Mart, Bonjour, Wu-Mart, and Jingkelong. Findings – The findings pertain to several different themes, including consumers, business relationships and distribution centres, product lines, store formats, quality systems, and competition. Research limitations/implications – The study’s findings are based only on four retailers. Practical implications – The paper presents a series of recommendations for both foreign-based and domestic retailers. Originality/value – This research is among the first to investigate operator attitudes toward competition in the grocery retail market in China.
Keywords:Food products, Retail marketing, China, Market share, International marketing
Subjects:N Business and Administrative studies > N500 Marketing
N Business and Administrative studies > N120 International Business studies
N Business and Administrative studies > N240 Retail Management
D Veterinary Sciences, Agriculture and related subjects > D640 Food and Beverages for the Consumer
Divisions:College of Social Science > Lincoln Business School
ID Code:4267
Deposited By: Martin Hingley
Deposited On:21 Mar 2011 14:48
Last Modified:18 Jul 2011 16:40

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