Wumart to explore department business By Liu Jie (China Daily) Updated: 2004-08-16 09:00
Wumart, one of China's leading chain retailers, is trying to tap the
department store sector, the company confirmed.
Wu Jianzhong, senior vice president of Wumart, disclosed that the first
department store of the commercial giant, covering a combined business area of
some 20,000 square metres, will be opened in Chengjian Plaza, a complex located
in the populous North Third Ring Road of Beijing.
As the complex is still under construction, the first Wumart Department Store
is expected to be officially launched by the end of September, according to Wu's
optimistic estimation. Wu refused to reveal the operational details of the
department store in terms of marketing strategy, business focus and consumer
group targeting.
A source close to the company said that the manager of Wumart's department
store sector will possibly be Guo Kai, the former general manager of Beijing's
Xidan Department Store, one of the leading department store companies in China.
"The decision is based on Guo's rich experiences in the department store
business," said the source.
A survey conducted by the Ministry of Commerce showed that Wumart was ranked
the 12th largest retail company around the nation last year. It was the first
Beijing Commercial enterprise to be listed in the overseas market.
So far, the Chinese conglomerate operates hypermarkets, supermarkets and
convenience stores around the nation.
Wumart announced in November 2003, when it became listed on the Hong Kong
Exchanges, that the company was to open over 400 new outlets, including 10
hypermarkets, 32 supermarkets and more than 300 convenience stores in Beijing by
the end of 2005.
Due to its rapid expansion in the recent years, Wumart's annual growth rate
of sales volume reached 60 per cent from 1995 to 2003. And its growth rate of
net profit hit 76 per cent and 156 per cent in 2002 and 2003 respectively.
"To exploit the general merchandise market is necessary to supplement
Wumart's current business," said Wu.
He believes that diversifying the business structure may help the enterprise
avoid risk and make full use of various resources, including commercial talents,
purchasing systems, sales network as well as the value of its famous brand.
The source close to Wumart disclosed that Wumart is looking into Fangzhang in
the southern part of the capital city, and Xinjiekou in central Beijing, to
select sites for its second and third department stores in Beijing.
"Wumart's move indicates that the giant is striving to enlarge its scale and
become more powerful in a short period of time," said Fan Yanru, deputy
secretary general with the retail enterprises committee of China Commerce
Association for General Merchandise.
Faced with the gloomy conditions in China's department store sector to-date,
Fan said that she hoped Wumart can introduce advanced operation technologies and
rich experience into the industry.
