Chinese food retail giants to gain from internet-savvy buyers

Concerns on food availability have compelled consumers to download grocery apps.

Major food retailers in China could see some boost through online channels as customers placed greater priority on cleanliness and safety, according to a Jefferies report.

Food retailers were expected to see some pull back in March or April with the end of the lockdown, but some like Sun Art believe that modern trade is taking market share from traditional channels.

Further, due to concerns on food availability, most consumers have downloaded various apps, making them more familiar with online grocery shopping. The availability of food produces was their key choice in placing orders when the outbreak was at its peak in February.

After the outbreak, consumers may likely switch their focus to better quality suppliers.

Based on channel checks, the report noted that food retailers continue to experience good same-store sales (sss) trends in April YTD.

Restaurant recovery is still slower, especially for full-service restaurants. Meanwhile, some hypermarket operators like Sun Art have increased their food and fast-moving consumer goods (FMCG) offerings since the outbreak.

Photo from Sun Art website