More on China

In an article in the Minneapolis Star-Tribune (11/15/05), we gain insight into the strategy of General Mills in China. They are (wisely in my opinion) looking to the long-term. The most interesting part of the article, though, was to me a graph detailing the number of people in China that General Mills sees as being able to consider purchasing three of their products.

There’s also a fascinating article in Retail Traffic, giving lots of statistics on the development of Chinese retail. For example a listing of the top retailers (only one of the top ten – Carrefours – is a foreigner. Wal-Mart is nineteenth), as well as the news that a mall is being developed in Dongguan that will be twice as big as Mall of America. However, as the article notes, street vendors “remain the dominant retailers.”

I noted in my newsletter (TPM Update) that Wal-Mart is having problems in China because they can’t compete on price, which is the only thing they know how to do. Retail Traffic echoes this: “While its primary attraction here is its low prices, in China, that's not enough. ‘They can't match the prices of street markets, so they have to compete on the basis of quality, product mix and convenience..."