Chinese Commodities Snapped Up by International Retailers

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Last updated at: (Beijing Time) Sunday, April 28, 2002

Chinese Commodities Snapped Up by International Retailers

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While multinational retailers are flooding into China to share its huge market, many are also fixing their eyes on the country's cheap quality products, listing the country as one of their global procurement bases.

This month, two fairs have been staged in China to facilitate international retail procurement in China. In Nanjing, a total of 34 world-renowned retailers like Wal-mart, Carrefour, Metro and Jusco attended the three-day International Retailers'Global Sourcing Fair, meeting with over 1,100 Chinese manufacturers. Some of them also appeared in a similar event held in Tianjin.

"Chinese products have low prices, but high quality, and besides, they are safe," said Philippe Rabit, vice-president of France's Carrefour, who has sent to the Nanjing fair more than 100 global sourcing buyers from France, Belgium, Italy and China, adding that China was an important partner of Carrefour, and his company planned to double its procurement value from China in the next few years.

Metro and Wal-mart also said China's merchandise was gaining in international popularity and they were quite competitive in terms of packaging, design and price.

In fact, the three international retailers and many others have set up or moved their global sourcing centers to the Chinese interior. Carrefour this year alone established another nine in China.

Analysts say that against the backdrop of a global plunge in consumption, Chinese products' competitiveness has become even more conspicuous.

In 2001, international retailers purchased nearly 30 billion U.S. dollars of commodities from China, which accounted for 12 percent of the total export value of the country. In contrast, sales values of retailers listed in the world's top 500 companies topped 1,500 billion U.S. dollars, but Chinese products accounted for just two percent of the total amount. Analysts say China enjoys huge potential for further exporting its commodities to the retailers.

Last year, China's largest microwave oven producer, Galanz, sold 12 million U.S. dollars of products abroad through Carrefour, and it is the common aspiration of most Chinese manufacturers to export more through international retailing channels. However, some retailers say they have little knowledge of most Chinese companies and their products, while Chinese manufacturers are unfamiliar with retailers' technological requirements and international consumption trends.

Consequently, it has become necessary to provide some sort of platform for suppliers and buyers to get together and exchange views for better mutual understanding. In view of this, the State Economic and Trade Commission has decided to organize more activities like those in Tianjin and Nanjing. Together with other organizations, it will take measures, such as encouraging retailers to set up procurement centers in China by solving issues concerning customs, foreign exchange management and taxation, and supporting domestic enterprises in upgrading technology to better suit the requirements of retailers.

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