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.