Forming a network of over 70 stores and a 2.2m-strong member base, is a new agreement between AS Watson Group, Tencent Holdings, and Yonghui Superstores.
The companies will hold 40, 10 and 50 per cent stakes respectively, creating what is reportedly the largest grocery retail business in Guangdong, China.
Announced on 26 October, the partnership will create a new brand called ParknShop-Yonghui, combining AS Watson’s current ParknShop China supermarket assets with Yonghui’s high-tech ‘retail experience’ portfolio in Guangdong province.
The move will focus on capturing growth in the Guangdong-Hong Kong-Macao ‘Greater Bay Area’ – an initiative allowing more movement and business in the densely populated area.
Marketing Interactive reported that Guangdong contains 8 per cent of China’s population, and has shown strong growth in retail sales, up 16.1 per cent in the first eight months of 2018 (according to the Guangdong Bureau of Statistics).
“We have been looking at ways to accelerate our expansion and there is no better partner than Yonghui to achieve that mission,” said Dominic Lai, group managing director of AS Watson.
“I am very excited about this joint venture which enables us to combine the power of two retail brands, thus giving birth to a powerful contender in grocery retail in Southern China to the ultimate benefits of consumers,” he said.
Both AS Watson and Yonghui will utilise their strengths in retail, while Tencent Holdings, owner of the WeChat app, offers technology and data analytic capabilities.
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