Chinese hypermarkets are in crisis and have found the solution: follow the Mercadona model

The golden age of Chinese hypermarkets is coming to an end. With the economy stepping on the brake, these mastodons are in a tighten and desperately seek new formulas to hook consumers who look more at the pocket. In this new panorama, the solution seems to be betting on the strategy that Mercadona dominates perfectly for years.

What’s happening. The great Chinese supermarkets are having You would be difficult to survive. In recent years, Carrefour has closed more than 140 stores, Tesco has disappeared and last year the main leading hypermarkets had Important losses. With The economy in decelerationChinese consumers are more cautious when spending and that is causing the main chains to change their strategy drastically, as reported in Bloomberg.

The Mercadona model. Many neighborhood stores and more white brands, this is how some Chinese giants are adapting to this new era. The own brands were not usual in China, but currently they take more and more space in the halls of the main chains. In addition, they are beginning to change their store strategy, favoring the proximity of smaller stores instead of hypermarket that forces us to move by car and plan a larger purchase.

Adapt or die. Chinese hypermarket chains are transforming with smaller formats and their own brands. Walmart, with its stores proximity to Lo Carrefour Express and its MarketSide brand, is a good example of this trend. The Wumart Group has launched Six stores with discounts in Beijing and FreeShyppo, from Alibaba, already has more than 300 stores under its cheap chaopa brand. Approximately 60% of the products found in these stores are white brands. This strategy responds to the search for savings and convenience by the consumer.

The Pangdonglai case. It is a Henan supermarket that has achieved viral success. Its strategy is based on exceptional customer service, good treatment of unique employees and services such as ticket offices with dog water and personalized preparation of the purchase basket. But the main secret of their success is that they have placed their profit margin in 30%, which allows them to keep low prices all the time, without having to resort to specific promotions. Despite having been born in a smaller city, its model is so influential that Yonghui Superstores, the fourth chain of China, is reforming its stores following its example.

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