Tough Sledding for Retailers in China

China may have the world’s largest consumer base, but it is also a difficult place for foreign retailers to thrive. Here’s more evidence of this situation.
According to Anil Gupta and Haiyan Wang, writing for Businessweek:
“Tesco’s recent decision to transfer its retail operations in China to a joint venture controlled by China Resources, a local state-owned enterprise, is just the latest example of a prominent Western retailer that has stumbled in China. Tesco entered China in 2005. With 131 stores in the country, however, it ranks only No. 8 by size in China’s hypermarket retail segment and commands a tiny 2 percent share of the market. Letting China Resources take over these operations appears to be the right move for Tesco’s shareholders.”
“Other high-profile failures of Western companies in China’s retail sector include Home Depot and Best Buy. Home Depot entered China in 2006. In 2012, it decided to close all seven of its stores and exit. Best Buy also entered China in 2006, but its market share in China’s consumer electronics retailing has been shrinking and was estimated at less than 2 percent in 2012. It would not be surprising if Best Buy also decides to exit from China. Even the French retailer Carrefour is rumored to be exploring a sale of its China business.”

Click the image to read a lot more.

Photo by Imaginechina/AP Images

This entry was posted in Global Retailing, Part 1: Overview/Planning, Part 2: Ownership, Strategy Mix, Online, Nontraditional, Part 3: Targeting Customers and Gathering Information and tagged , , , , , , , , , . Bookmark the permalink.

1 Response to Tough Sledding for Retailers in China

  1. Pingback: Tough Sledding for Retailers in China | Retaili...

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