Tesco, Other Foreign Retailers Struggle In China's Retail Market

Foreign-owned retailers, including Tesco Plc and Wal-Mart Stores Inc., are slowing down their expansion plans in China. Tesco is closing down stores and opening new ones more slowly as Chinese consumers prefer to shop in local stores and as the country's economy slows down. Wal-Mart is also adopting a more cautious approach to expanding in China's $560 billion grocery industry. Local retail chains, such as Sun-Art, Yonghui Superstores Co., and China Resources Enterprise Ltd., are performing strongly in smaller cities, making it more difficult for foreign retailers to compete in tiers 2 and 3 cities.