Northern Chinese retailer to tap Shanghai's market
24/8/2004 10:08
Jane Chen /Shanghai Daily news
In response to
local retailing giant, Shanghai Bailian (Group) Co Ltd's, arrival in Beijing,
Beijing Wu Mart Retailing Group Co Ltd, a leading retailer in northern China,
has announced a plan to open a flagship store in Shanghai to tap the local
market, today's Youth Daily reported.
The only Hong Kong-registered private
retailer, from China's mainland, has invested millions of yuan to buy a lot in
Shanghai, on which it will open a flagship hypermarket, its president Zhang
Wenzhong said.
The company will also build an office building on the plot for
the headquarters of its East China branch, he added.
Wu-Mart's arrival is
based on the huge potential of the local market, industry insiders pointed
out.
In the first six months, the sales of hypermarkets in Shanghai have
reached 12.7 billion yuan (US$1.54 billion) while that of the supermarkets hit
32.1 billion yuan.A low-price strategy will be the trump card for Wu-Mart's
store, as an official with the company said: "Though price-cutting is a low-end
competition strategy, it's very effective".
But according to industry
insiders, it is the location of Wu-Mart's local store that will force it to
adopt a low-pricing strategy to get an upper hand over its fierce competition.
Some 500 meters away from the store are located two foreign hypermarkets,
France's Carrefour and the South Korean Emart.
To win more customers, Wu-Mart
plans to offer a free transport service of air-conditioned shuttle buses to and
from their store.
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