COVER STORY
Stocker, a partner at consultancy AT Kearney, told China Economic Review. “Historically, you had a lot of retailers that existed at the very local level or provincial level and everybody [big and small supermarket chains] is still expanding.” Foreign groups have a major presence in big cities in eastern and central China, operating mostly in the hypermarket segment. Wal-Mart has the biggest branded presence of the multinationals, with more than 380 stores; Carrefour has over 218 outlets. The leading Chinese supermarket chains operate across multiple formats, from bigger stores to mid-sized supermarkets and smaller units, giving them a much deeper presence. Lianhua Supermarket Holdings, the biggest gro-
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cery chain on the mainland, has more than 5,150 stores. CRE’s CR Vanguard supermarket unit has almost 3,000.
On a mission No retailer wants to fall behind in a grocery market that is projected by consumer research firm IGD to grow in value from US$1 trillion in early 2013 to US$1.5 trillion by 2016. CR Vanguard has been expanding aggressively. Between 2001 and the end of 2010 it closed six acquisitions. In 2011, the company snapped up Jiangxi Hongkelong. Complementing its acquisition-led expansion, the company is building up high-end brands BLT and Ole that sell imported foods to chase higher margins. “You can see that they always put market share as the top priority,”
when considering an M&A deal such as the one with Tesco, a Hong Kongbased retail analyst, who declined to be named, told China Economic Review. CR Vanguard is now adjusting to the slowing Chinese economy. Up until the end of last year the company had been expanding in China through targeted store openings, in line with the practice of many retailers, said Jon Copestake, chief retail analyst with the Economist Intelligence Unit in London. “This tie-in with Tesco may reflect a more considered approach, using the Tesco store network as a means of expanding penetration without incurring significant risks or costs.” The Hong Kong-based analyst agreed, noting that in 2013 CR Vanguard has eased the opening of new