Along with the structural adjustment and slow down of economy in China, retail industry has also started its times of evolution. Wages, logistics and all sorts of costs in the retailing industry remain high, resulting significant pressure on profitability. At the same time, e-commerce has quickly taken over the market share of traditional retail by offering lower prices, convenience payment, door-to-door delivery and other thoughtful services. In front of the unprecedented challenges, retailers have actively or passively adjusted their development modes, in order to survive, develop and even achieve sustainable success in the ever changing market environment.
Courage to evolution derives from the forward-looking attitude in striving for industry development. In the future, there will be five major trends in the development of retail industry in China. Firstly, urbanization will bring new opportunities to the retail industry resulting to the changes in consumption structure, where proportion of residents in urban areas has increased, as well as the increasing consumption capabilities of those live in the third and the forth-tier cities. Secondly, multi-format business has become the mainstream, which will continue to develop in the next few years. Thirdly, following the emergence of Omni-channel shopping experience, internet and traditional retail channels have integrated with each other, which will offer seamless shopping experience to consumers. Fourthly, mobile-commerce leads to evolution of brick-and-mortar stores, where consumers have gradually developed a shopping habit using mobile phones. In the future, impacts on store sales from mobiles will further increase. The last, Integration of retail industry and capital market remains active. While VC/PE investment in the online retail sector has been growing rapidly, there are an increasing number of acquisitions in traditional retail area. Integration of the retail industry continues.
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