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Retail Chain Stores Boom: SETC
Shanghai-based Hualian Group Co Ltd had the largest sales last year in a State Economic and Trade Commission (SETC) survey of major Chinese chain companies in the retail and restaurant sectors.

The group's sales increased 52.51 per cent year-on-year to 21.47 billion yuan (US$2.59 billion) last year.

But Lianhua Supermarket Shareholding Co Ltd had the largest number of chain stores, with 1,921 stores last year, up 56.82 per cent from the previous year, compared with Shanghai Hualian's 1,541, which was a 47.89 per cent increase year-on-year.

"Chain companies in the retail and restaurant sectors continued a high sales growth last year and made important contributions to the demand-driven growth of the domestic economy," said Huang Hai, director of the SETC Bureau of Trade and Markets.

Total sales of the 30 largest chain companies stood at 178.04 billion yuan (US$21.50 billion) last year, up 43.43 per cent year-on-year. The rate of increase was about five times of the 8.8 per cent growth in China's total sales of consumer products last year.

The 30 largest chain companies had a total of 8,988 stores last year, up 53.22 per cent from 2001.

Among these companies, Shanghai Yongle Household Electronic Appliances Co Ltd, Shenzhen Xinyijia Investment and Development Co Ltd and Beijing Wumei Commerce Group Co Ltd more than doubled their sales last year.

Qingdao Liqun Group Shareholding Co Ltd in East China's Shandong Province, Nantong Wenfeng Dashijie Chain Shareholding Co Ltd in East China's Jiangsu Province, Shenzhen Xinyijia Investment and Development Co Ltd and Shanghai Nonggongshang Supermarket Co Ltd more than doubled the number of their stores last year.

"In the face of tough market competition and the huge growth of chain companies, some firms have turned to franchising as an important means of rapid expansion on a corporate scale," said Huang.

He said Chinese chain companies dramatically increased their financial strength and business scale last year.

Five of these companies had sales of more than 10 billion yuan (US$1.20 billion). The 20th chain company in terms of sales volume had sales of 1.72 billion yuan (US$207.7 million) in 2001, compared with 1.98 billion yuan (US$239.1 million) of the 30th company in 2002.

Except for Sanlian Group, which ranked the fifth largest in 2001 and did not provide data in 2002, the majority of the 30 largest chain companies in 2001 are still on the list in 2002.

(China Daily February 20, 2003)

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