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Retail chains see slower rise in sales and stores

CHINA'S top 100 retail chains saw slower sales growth last year, with the number of stores rising the slowest in 10 years because of the global economic crisis, the China Chain Store & Franchise Association said yesterday in a report.

The top chains, which include Gome, Suning and Bailian, generated an 18.4-percent increase in total sales value from a year ago to 1.20 trillion yuan (US$176 billion) in 2008, accounting for 11.1 percent of the country's total retail sales, the CCFA said. The number of retail stores reached 120,775, a rise of 10.6 percent on an annual basis but it was the slowest increase in 10 years, it said.

"The global economic downturn will still pose a huge pressure on retailers this year, and they face challenges of consumers tightening their belts, a possible deflation and lack of consumer confidence," the CCFA said. "Stiffer competition between retailers forces them to offer discounts to lure customers, which further narrows their profit margins."

The top chains have posted slower sales growth for four years, not including last year. The rates were 33 percent, 32 percent, 25 percent and 21 percent from 2004 to 2007.

Gome Electrical Appliances Holdings Ltd remained the top chain store with sales of 104.59 billion yuan. Suning Appliance Co overtook last year's No. 2 Shanghai Bailian Group to chalk up 102.34 billion yuan in sales.


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