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Online platforms resurrect retail fortunes

By WANG ZHUOQIONG | China Daily | Updated: 2020-05-02 08:57
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A customer uses a self-service machine to make payments for her purchases at a Wumart outlet in Beijing. [Photo/China Daily]

More retailers are now utilizing delivery services to supply fresh food and groceries to customers, according to a report from Kantar Worldpanel, a market consultancy firm. Retailers who were able to withstand the novel coronavirus disruptions and grow their customer base were those who were able to offer fast and efficient delivery services, the report said.

Sales of "modern trade" channels, including hypermarkets, supermarkets and convenience stores, fell by 3.7 percept during the first quarter on a yearly basis, with supermarkets the least affected by the COVID-19 outbreak with a 0.5 percent fall. Small, mini super retail stores saw robust growth of 13.5 percent during the same period as they are closer in proximity to consumers needing top-up daily necessities, the report said.

Hypermarkets struggled during the first quarter, experiencing a 3.7 percentage point drop in penetration on a yearly basis, as cautious shoppers stayed away from shopping malls and crowds. Hypermarkets and supermarkets also shouldered the crucial tasks in securing the steady supplies of daily necessities during the epidemic, following the principles of "no price surge". Major hypermarket and supermarket operators quickly expanded their online presence, either via self-run applications, third-party mobile applications or mini programs on WeChat for deliveries. Smaller-sized retailers turned to online-to-offline platforms such as Ele.me and Meituan to increase their accessibility in cities, said Kantar.

E-commerce on the other hand witnessed a stellar performance with a growth rate of 22 percent, despite challenges in logistics as a result of road shutdowns and staff and supply shortages amid the outbreak.

According to the report, e-commerce now accounts for 19 percent of the total fast-moving consumer goods spend and is expected to continue to grow this year.

Among the top "modern trade" players, Sun Art Retail maintained a steady position thanks to its strong integration with the Taoxianda platform under Alibaba, said the report.

Last year, Sun Art Retail accelerated its transformation of the traditional hypermarket format to make the stores smaller and digitally strong to meet shopper needs. RT-mart also actively leveraged community group buy apps as well as its own delivery platform "Youxian" to maintain services during the first quarter, according to Kantar.

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