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China Business Insight Alert Archive

Have a look at some of our recent alerts. These give broad coverage of the industry - if you want something more specific create your own here.

<<1234567>> Total issues:68

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July 01, 2016, to August 01, 2016

L'Oreal Launches Ultra Doux Shampoo Brand In China

L'Oreal launched the Ultra Doux shampoo brand in China. Aimed at the Chinese consumer, the Ultra Doux brand consists of 43 products within five series. L'Oreal has positioned the brand for the medium-end market and priced the products from CNY20 to CNY80. Ultra Doux products are sold in markets, including France, UK, and Russia, and is owned by Garnier, which was acquired by L'Oreal in 1985.

Low Shipping Rates Drive Growth For China's Alibaba Group

Very affordable overnight shipping rates in China have been a biggest factor driving growth for online retailer Alibaba Group Holding. Some of the growth should be credited to the company's Taobao online marketplace and the low prices of goods offered by its 10 million merchants. Alibaba has no direct hand in arranging shipping for Taobao merchants; each seller has to deal with one of the country's largest private courier companies. China's four largest shipping service providers are Shunfeng, or SF Express, and YTO Express, STO Express, and ZTO Express. On Taobao, a 3kg box of Tide washing detergent costs $3.13, or 20.90 yuan, including shipping. In contrast, the same product would cost at least $53 in the US, with at least $35 going to shipping.

Wal-Mart Grabs Bigger Share Of West China's Retail Market

Wal-Mart saw its share of the retail market in China's West region grow from 5.7 percent in 2015 to 6.4 percent in the 52-week period ending May 20, 2016, according to Kantar Worldpanel. Data from the market research firm revealed consumer spending on FMCG rose 2.4 percent during the period, significantly lower than the 5.1 percent recorded in the country during the previous year. Local retailer Yonghui's share of the market rose from the previous year's 3.6 percent to 4.9 percent, overtaking Vanguard to become the second largest retailer in the West region.

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June 01, 2016, to July 01, 2016

Wearable Food Waste May Help Solve A Global Problem

Researchers in Hong Kong are working on a way to turn discarded food into clothing. The core of the technology is the use of a lactic acid fermentation to transform starchy food waste with high sugar content into spun fibers. The researchers say the fiber is not yet strong enough to make textiles out of it, but further study should solve that problem. Meanwhile, scientists around the globe are creating their own food-waste-to-clothing solutions: orange peels into textile fibers; “leather” from pineapple leaves; fabrics from fermented milk and wine; and even food waste buttons.

Wal-Mart Seeks Bigger Share Of China's Online Retail Market

Wal-Mart is seeking to expand its e-commerce operations in China, as part of the company’s efforts to increase its share of the local online retail market. Yihaodian, which Wal-Mart acquired in July 2015, operates 250 e-commerce hubs in 200 cities across China. Online sales in the country reached $307 billion in 2013, hit $589.2 billion in 2015, and is forecast to grow beyond $1 trillion by 2019. In contrast, online spending in the US was $334 billion in 2015 and is forecast to reach $480 billion by 2019, according to Forrester. In China, 46 percent of shoppers are already buying groceries online for home delivery, compared with the global rate of 25 percent, according to Nielsen. Wal-Mart accounts for 1.6 percent of the local online market, which places it at number 6, behind Alibaba, which has 46.9 percent of the market and JD.com with 20.1 percent. According to analysts, Wal-Mart, which aims to be among the top 3 online retailers in the market, will find it hard to grab market share from the local online retail giants.

Wal-Mart Sells China E-Commerce Site To JD.com

Wal-Mart Stores Inc. said it has agreed to sell its Yihaodian website in China to JD.com Inc., the country’s second-largest online retailer. As part of the deal, which marks a strategic shift in the US-based retailer’s approach to e-commerce business in China, Wal-Mart will receive a 5-percent stake in JD.com. After opening its first store in China in 1996, Wal-Mart has found it hard to expand in the country where it operates about 430 locations. In 2012, Wal-Mart first invested in Yihaodian and gained full control of the website in 2015.

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May 01, 2016, to June 01, 2016

Carrefour Launches Online Store In Beijing

French retailer Carrefour launched its O2O online store in Beijing, China. Integrating store delivery and multiple payment methods, the online store will offer dual-language services, and will allow product returns and exchange at all of the retailer’s locations. Carrefour launched its O2O business in Shanghai in June 2015.

Unilever China Partners With Local Business Incubator

Unilever China through its Foundry initiative partnered with the Zhangjiang High-Tech Park to help speed up the growth of local startups with innovative technology. Unilever China Foundry expects to launch six business incubator projects in the country in 2016. Unilever was the only FMCG company selected to join the partnership due to its capabilities in consumer insights and marketing.

Sam's Club Gives Wal-Mart Something To Smile About In China

Sam's Club, Wal-Mart's membership-only retail warehouse club business, is doing well in China. Wal-Mart owns and operates 800 Sam's Club stores worldwide, and four of the top 10 locations are in China. Sam's Club in Shenzhen has been the company's number 1 location since 2008. Wal-Mart plans to add seven or more Sam's Club stores to the existing 13 in China by 2017. Its focus on attracting affluent consumers has helped the warehouse club business grow its sales and revenue in the country. Also, the company has seen growing sales after adopting Western-style packaging of seafoods and other fresh food products.

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April 01, 2016, to May 01, 2016

Carrefour Says Beijing SiYuanQiao Store Chosen One Of China's Best

Carrefour said its Beijing SiYuanQiao store was selected as one of the Top 10 Best Stores in China in 2015 by Linkshop. Announced during the Global Retail Innovative Summit 2016, the award focuses on newly built stores that offer shoppers with innovative and advanced concepts, techniques, or experiences. Winners were selected from among 500 new stores by the public and by a jury.

Alibaba Claims Retail Market Crown For Itself; Analysts Disagree

Alibaba Group declared itself the world’s largest retailer as of March 31, 2016, the end of its fiscal year, according to its filing with the U.S. Securities and Exchange Commission. In March 2015, Alibaba group executive vice chairman Joe Tsai said the company has recorded 3 trillion yuan, or about $476 billion, in gross merchandise volume. Some retail market analysts, however, disagreed with Alibaba’s pronouncement, saying the company’s business was too different from that of Walmart and hence there cannot be a meaningful comparison. Moody’s Investors Service debt and retail analyst Charles O’Shea said Walmart’s status as a physical retailer is a different business model than that of Alibaba.

SK-II Launches Advertorial Video Focusing On Single Women In China

Procter & Gamble’s beauty brand SK-II launched “Marriage Market Takeover,” a video advertisement highlighting the social conditions of single women who are older than 27 years in China. Called “sheng nu” or “leftover women,” single women who are 28 years and older face heavy pressures from society, including their family, in China. According to SK-II president Markus Strobel, the campaign is part of the brand’s efforts to inspire and empower women to determine their destiny.

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February 01, 2016, to April 01, 2016

Battered By Poor Sales In China, Hershey Girds For The Future

Chocolate maker Hershey’s has its work cut out over the coming years, according to Euromonitor. Though profit was satisfactory, overall sales fell slightly in 2015 – and by five percent in the fourth quarter and 13 percent in China. The company, which advanced in recent years into the international market, is struggling to keep up with competitors. The core North American market is softening as per capita chocolate volume growth slows. Americans who buy chocolate are turning to higher quality brands, and that has led to competitive pressure from Lindt and Ferrero. Over the next five years, Hershey’s is expected to focus on its non-confectionery portfolio, pushing wider distribution of Krave Jerky meat snacks and Brookside Snack Bars in 2016.

Chinese Company Acquires Syngenta In Push To Ensure Country’s Food Supply

After Monsanto failed to secure a purchase deal, ChemChina has made an offer to acquire Swiss crop protection company Syngenta at $465 a share. ChemChina’s main businesses include materials science, life science, high-end manufacturing and basic chemicals. Syngenta’s corporate vision jibes with China’s priority to ensure the food supply for its people. Syngenta enables farmers to make better use of available resources and “to transform how crops are grown.” Industry observers say only ten percent of China’s farmland is managed efficiently after years of intensive farming and overuse of chemicals. The land has been debased and the water supply poisoned. One of Syngenta’s major functions is to rescue land from degradation, enhance biodiversity and revitalize rural communities.

L'Oreal Sells More Cosmetics In China Than In France

L’Oreal SA CEO Alexis Perakis-Valat said the French cosmetics company’s sales in China grew 4.6 percent to 14.96 billion yuan, or $2.29 billion), in 2015. With sales growth driven in a large part by the local market’s multi-brand make-up boom, the company now sells more cosmetics in China than it does in France. Perakis-Valat also said the market boom is due to the growing “selfies” trend among women in China.

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December 01, 2015, to February 01, 2016

Unilever Receives Top-Employer Honors From China's Top Employers Institute

Unilever was named the number 1 employer in China by the Top Employers Institute. Unilever China, which has a number of initiatives aimed at meeting the challenges posed by the China market, has been implementing programs to always improve its HR strategies and policies. Its efforts to put people at the heart of its business has earned Top Employers Institute’s recognition, the company said.

More U.S. Companies Think Of Moving Capacity From China To Other Locations, AmCham China Report Reveals

In 2015, only 64 percent of U.S. companies doing business in China described their operations as profitable, the lowest level in the last five years, according to the American Chamber of Commerce in the People’s Republic of China. Results of the group’s 2016 China Business Climate Survey Report revealed almost half of respondents predict China’s overall GDP growth in 2016 will fall below 6.25 percent. Member companies cited economic challenges and the regulatory environment as key factors limiting their ability to invest and grow in the country. Human resources issues, including labor costs and shortage of qualified workers, are also among the top 5 problems cited by member companies. Although China remains a top 3 investment priority for six out of 10 member companies, about one-third of respondents said they are not planning to increase their investments in the country in 2016. By the end of 2015, 25 percent of respondents have either already moved or are planning to move operations outside of China.

Study Estimates Job Loss Impact Of Walmart’s China Imports

A study by a progressive research organization accuses Walmart of displacing or eliminating more than 400,000 high-paying American manufacturing jobs by importing many billions of dollars’ worth of products from China over a twelve-year period ending in 2013. The Economic Policy Institute says Walmart’s imports from China in 2013 alone totaled $49 billion. The U.S. trade deficit with China in 2013 was $324 billion. The lost or moved jobs represented about 13 percent of the 3.2 million total jobs lost or displaced over those same years due to the China trade deficit. Walmart criticized the data and conclusions of the study as mostly guesswork, because retailers do not disclose itemizations of imports.

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November 01, 2015, to December 01, 2015

Different Skincare Concerns Occupy Consumers' Mind In China, Japan, And Korea

Consumers in China, Japan, and South Korea have different concerns and issues as far as skin care is concerned. For example, consumers in China are focused on the preventative treatment of skin ageing, while Korean consumers are more reactionary, treating damage as it appears. In Japan, consumers tend to “work alongside” with the ageing process.

Olay Launches Social Media Campaign For Olay Total Effects Line Of Skincare Products In China

Procter & Gamble’s Olay skincare brand lunched the “Be Spendthrift No More” social media campaign for its Olay Total Effects line of anti-aging moisturizers in China. Developed in partnership with Lauyeah Production and Strategic Communications Consultants, the campaign began with an online video showing eight women testing a product, with its brand unrevealed, and then were asked to guess its price. Also featuring Facebook posts, the campaign combines online and offline elements, running simultaneously with an outdoor event at Causeway Bay.

China’s FMCG Market Growth Slows, Though Online Shopping Is Booming

Spending in China’s fast moving consumer goods (FMCG) market slowed in the year that ended in September, growing by only 4.7 percent, according to Kantar Worldpanel. For the third quarter, growth dropped to 2.7 percent, the lowest rate in three years, from 6.6 percent in the second quarter. Growth in hypermarkets, supermarkets and convenience stores grew only 2.4 percent in the third quarter. International retailers continued to struggle: market share slid from 14.5 percent to 13.5 percent. China’s local retailers fared much better. Sun-Art Group boosted market share to 7.5 percent, up from 6.9 percent in the third quarter of 2014. 2014Q3. Online shopping in China rose 37 percent during 2015, spurred by gains in penetration and purchasing frequency.

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October 01, 2015, to November 01, 2015

Despite Economic Slowdown, China Remains World's Largest Market For Professional Skincare Products

China, Europe, and the United States are three of the largest markets for professional skincare products in the world, according to marketing research firm Kline. Data from the report “Professional Skin Care Global Series: Market Analysis and Opportunities” revealed ethnic and cultural influences are driving growth in China’s skincare market, with sales at spas, salons, beauty institutes, and physicians’ offices accounting for a bigger part of total market revenue. Chinese consumers prefer local brands, such as Amitabha, Chlitina, and Jourdeness; however, international brands, including SkinCeuticals, Decleor, and NeoStrata, are growing at rates higher than 8 percent and account for more than 8 percent of the total market. Worldwide, the professional skincare market is forecast to expand at a compound annual growth rate of almost 5 percent by 2019.

Henkel Beauty Care Wins Retail Honors In China

Henkel Beauty Care won awards from Watsons, Mannings, and Nielsen for its China retail business in the third quarter of 2015. Considered the top honors in China’s retail sector, the Watsons Health, Beauty and Wellness Awards honor brands that have received wide reception among consumers. Henkel’s Schwarzkopf haircare brand won the Best of the Best award. Henkel also won the Best Supplier of the Year award from Mannings China in the Health and Beauty category for the third consecutive year. Henkel’s Schwarzkopf Freshlight Waterlily Moisture Shampoo was chosen as one of the 15 products in the hair category of Nielsen’s 4th Annual Consumer 360 Forum awards.

Henkel CEO Disagrees With Too Harsh Assessment Of Economic Conditions In Emerging Markets

Economic conditions and prospects in emerging markets are not as bad as some analysts and investors claim them to be, according to Henkel chief executive Kasper Rorsted. Although the slowing growth in emerging markets is right to be blamed for the slowdown in global economic growth, economic conditions in China, Brazil, and other emerging markets are not as severe as the one that happened at the end of the last millennium. With lessons learned from the Asian crisis, currencies of most developing countries are not fixed, while governments are working hard to promote and ensure economic development. While not as robust as they were years ago, emerging markets’ economy is growing between 3 and 4 percent.

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September 01, 2015, to October 01, 2015

Wal-Mart Demands Lower Prices For Goods Made In China

Wal-Mart Stores Inc. is demanding lower prices from its suppliers that manufacture their goods in China. Seeking to share in the savings generated by China’s devaluation of the yuan, Wal-Mart managers in various countries have reportedly asked price cuts of 2 percent to 6 percent. Aimed at helping Wal-Mart maintain its “everyday low cost” or EDLC, the demand for cost cuts will cover mainly general merchandise, including home furnishings, apparel, and health and beauty products.

Unilever Opens Innovation Incubation Center In Shanghai

Unilever China partnered with the Shanghai Technology Entrepreneurship Foundation for Graduates to open The Unilever China Foundry, the company’s global innovation incubation program, in Shanghai, China. With Unilever investing at least €1 million per year, the Foundry project will accept business proposals aimed at helping the company in terms of smart technologies and marketing methods. Initial focus of the proposals will be on five leading requirements, including digital-enabled anti-counterfeiting technologies, smart vending platforms, and interactive packaging.

Euromonitor Identifies World's Top Countries With Fastest-Growing Middle Class

For the period 2015 to 2030, China, India, Indonesia, Nigeria, and the Philippines are forecast to have the fastest-growing middle class, according to Euromonitor International. Factors that are expected to make the middle class the “prominent consumer force” in these emerging countries include their growing size, strong income growth prospects, and a median income exceeding US$10,000 per household in 2030. According to Euromonitor, China will remain the world’s largest middle class despite its economic slowdown, while India is forecast to be among the top countries in terms of growth in median income. In Indonesia, middle-class households are expected to gain more purchasing power, while Nigeria’s middle class is forecast to reach 15 million in size by 2030. Economic growth stability and improved income distribution will drive the middle class in the Philippines to grow 41.8 percent.

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July 01, 2015, to September 01, 2015

Co-founders Of Walmart's China E-commerce Venture Resign

Wal-Mart Stores Inc. said the co-founders of its Yihaodian e-commerce business in China will leave the company. Citing plans to pursue new ventures, Yu Gang and Liu Junling are resigning as chairman and chief executive, respectively, of the online retailer. Wal-Mart holds a 51 percent stake in Yihaodian, which represents the American retailer's efforts to expand its online business in China. After the founders' departure, Wal-Mart is expected to expand its role in running the company, which for years has resisted the retail giant's efforts to consolidate the companies' logistics operations.

L'Oreal Agrees To Connect Yichang Factory To Hydropower

L'Oreal signed an investment deal to expand and connect to hydropower its Yichang plant in China. Part of the strategic agreement between the company and the Yichang government, the project will help L'Oreal's factory to use clean and renewable energy. By end of 2015, the Yichang plant will become the company's first factory in Asia-Pacific to become carbon-footprint neutral. One of the company's most sustainable factories, the Yichang plant has reduced CO2 emissions by 45 percent from 2005 to 2014.

Tesco Data Analysis Unit Dunnhumby Partners With Chinese Grocery Chain

As British retail grocer Tesco finalizes plans to divest several of its businesses, one of the units on the auction block, data analyst Dunnhumby, has cemented a joint venture relationship with a large Chinese supermarket chain. Dunnhumby will partner with China Resources Vanguard, which operates 4,000 shops in Hong Kong and mainland China. The partnership will give Dunnhumby access to shopper data in a rapidly-expanding market that includes 20 million Vanguard loyalty card users. It also gives the company an opportunity to work with other retailers. Several industry and private equity buyers have expressed interest in acquiring Dunnhumby’s. Final bids are due in early September.
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