DUBLIN--(BUSINESS WIRE)--Research and Markets (http://www.researchandmarkets.com/research/f27c1e/china_retail_repor) has announced the addition of the "China Retail Report Q4 2011" report to their offering.
Business Monitor International's China Retail Report provides industry professionals and strategists with independent forecasts and competitive intelligence on China's retail industry.
The Q411 BMI China Retail Report forecasts that the country's total retail sales will increase by 73% in local currency terms by the end of the forecast period, growing from an expected CNY17.47trn (US$2.56trn) in 2011 to a projected CNY30.21trn (US$4.42trn) by 2015. Retail sales in China doubled between 2003 and 2008, when they broke through the CNY10trn (US$1.6trn) barrier for the first time.
Strong underlying economic trends, population growth and the increasing wealth of individuals are key factors behind retail market expansion. Regulatory reform following China's accession to the WTO in December 2001 has allowed foreign retailers to make significant inroads into the market, contributing to forecast average annual retail sales growth of 14.5% in local currency terms.
Growth in the Market
China's nominal GDP is forecast to be US$6.90trn in 2011. GDP growth of 8.3% is forecast for the year, with average annual growth of 7.6% predicted by BMI through to 2015. With the population estimated to increase from 1.35bn in 2011 to 1.38bn by 2015, GDP per capita is forecast to grow by 59% to reach US$8,310.
The growth in the overall retail market will be driven in large part by a growing urban population with high disposable incomes and an interest in aspirational purchasing. According to socioeconomic forecaster Global Demographics, more than 30% of all urban households in China had an annual income above CNY40,000 (US$5,848) in 2007. The National Bureau of Statistics (NBS) estimates that urban retail sales accounted for nearly 68% of total retail sales in 2009, down slightly on 2008.
Multinational Retail Presence
A sizeable multinational retail presence following the lifting of foreign direct investment (FDI) restrictions in 2001 has ensured the early adoption of modern retail best practices in China. Organised retail - i.e. Western-style chain outlets, department stores, supermarkets, etc - already accounts for an estimated 23% of the total retail market, far higher than the 5% in India.
Chinese retailers have been expanding into secondary and tertiary towns and cities. By December 2010 GOME Electrical Appliances Holding, China's leading retailer of household appliances and consumer electronic products, had 304 outlets in 182 second-tier cities. In its 2010 annual report, the company said it believed that first-tier markets were its fundamental basis, but that second-tier markets will be the focus of future growth'.
Partnerships between local players and multinationals are allowing for rapid development of the retail market. In November 2007, Beijing Hualian Group signed a joint venture agreement with British company Costa Coffee to open 300 Costa stores in Beijing, Tianjin, Hebei, north east China and other regions in the next few years.
Retail Sales for Asia
Retail sales for the BMI universe of Asian countries in 2011 are a forecast US$3.13trn. China and India are predicted to account for nearly 91% of regional retail sales in 2011, and by 2015 their share of the regional market is expected to be more than 92%. Growth in regional retail sales for 2011-2015 is forecast by BMI at 71.6%, an annual average 14.4%. India should experience the most rapid rate of growth, followed by China. China's forecast 2011 market share of 77.6% is expected to decline slightly to 77.1% by 2015.
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