Lotus Opens First “Five Star” Supermarket In Shanghai

Thai Hypermarket Chain Opens 11,800-Sq.-Meter Premium Supermarket In City’s Pudong New Area

Lotus is hoping to tap into China's lucrative, growing high-net-worth consumer market with their new "five star" supermarket concept

Lotus is hoping to tap into China's lucrative, growing high-net-worth consumer market with their new "five star" supermarket concept

Major supermarket chains are finding new ways to tap into China’s growing ranks of wealth urban consumers. In Shanghai, the Thai hypermarket chain Lotus — a joint venture of the Charoen Pokphand Group and British chain Tesco in China — this week opened its first “five star” hypermarket, in an attempt to meet the demand of wealthy Shanghainese (and foreign residents) for more premium and imported goods. In the wake of recent tainted milk scandals, and other food safety problems in the past, so-called “premium” supermarkets have begun to spring up in China’s major cities, with Hutchinson Whampoa, Park N Shop and Hualian Hypermarket entering this new market segment in 2009.

As one of the larger foreign supermarket chains in China, with around 70 locations, Lotus is apparently eager to expand into the lucrative premium grocery market in first- and second-tier markets this year. Considering the chain sold off its Tianjin properties and exited that market last year due to poor performance, tapping the “five-star” niche in major cities could be a smart move.

According to reports, around 40% of the roughly 40,000 products at the first Lotus “five star” supermarket in Shanghai’s Pudong New Area are imported, and in addition to hypermarket staples like live seafood, the market will stock around 1,000 foreign wines. Company reps have said that the company is currently eyeing commercial areas, high-end business zones or luxury communities in other major cities for expansion of their premium brand, though they haven’t given further details. However, we can safely assume they’re thinking of Beijing, Guangzhou, and possibly Shenzhen.

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