China’s growing convenience store sector could provide new opportunities for fresh produce exporters with retail chains increasing their imported food offerings, according to a USDA GAIN report.
While the explosion of China’s e-commerce sector has captured the attention of many, the country’s convenience store sector has been enjoying its own boom. It is the second fastest developing retail model, with sales increasing 23 per cent in 2017 to US$28bn.
The report detailed the ‘hotspots’ for growth have been second-tier cities such as Xi’an, Kunming, and Chongqing, which all saw openings increase by more the 20 per cent in 2017.
Larger cities such as Beijing and Shangai are still growing but expansion is limited by rising rent, labour and utility costs in these areas.
According to the report, the convenience store sector has traditionally focused on lower priced processed foods and beverages, but many large chain operators are now increasing their fresh and healthy products, private label products and premium and imported food offerings to improve profitability.
Single-serve, attractively packaged, high quality products are perceived by customers as fresher and healthier than traditional convenience store fare, so they are especially sought after.
This provides an opportunity for fresh fruit and vegetable exporters who market their produce as a premium product.
The report also recommended exporters target local distributors, which convenience store operators rely on, rather than working directly with convenience stores.
Based on the growing number of outlets and popularity with consumers, the report concluded that convenience stores will grow over the next three years and may become an important distribution channel for imported foods.