Chinese School - 10th Five-Year Plan

BIZCHINA / Trade

10th Five-Year Plan

Updated: 2006-04-18 11:32

The Tenth Five-Year Plan of Retail and Wholesale Industry and its
Development

During the 10th Five-Year Plan period (2001-05), a number of large
conglomerates of commodity circulation will come into being through M&A,
combination, chain-store operation or agent management practice. They
will be characterized by specialties in business, sound management, wide
radiation and strong competitiveness. By the end of 2005, medium and
small-sized State-owned stores will have basically gone through
reconstruction or restructuring. They will be regrouped into
agglomerations at various levels and with different scales.

Meanwhile a number of large commercial conglomerates with annual retail
sales over 30 billion yuan will be formed through consolidating part of
the stores. Some of the large monopolies will shoulder the task of
developing large commodity circulation conglomerates.

Shanghai plans to set up two or three large conglomerates with retail
sales over 30 billion yuan and more than 10 medium-sized ones with retail
sales over 10 billion yuan by the end of the period. Beijing plans to
establish one or two chain-store conglomerates with retail sales over 10
billion yuan and three to five ones with retail sales over 5 billion yuan.

China aims to consolidate the key role of chain-store business in the
commercial and service trades in five years to ensure big increment of
sales revenue and number of chain business enterprises and chain stores.

By the end of 2005, the number of chain stores will reach 100,000 with
sales revenue amounting to 700 billion yuan, or about 20 percent of the
overall sales revenue of wholesale, retailing and catering trade. 20
chain-store enterprises each with annual sales revenue of over 5 billion
yuan and 40 ones each with annual sales revenue of 2-5 billion yuan will
be built. Five to 10 internationally competitive large chain
conglomerates will be incubated.

Restructuring of State-owned commercial enterprises will enter a vital
stage, with the focus to be on dealing with the difficulties in
debt-ridden State-owned wholesale enterprises and large general-line
retail enterprises. Small and midsize State-owned commodity circulation
enterprises will be further promoted by means of joint stock cooperation,
merger, purchase or closedown.

Building of a modern enterprise system will be stepped up. At present,
public economy accounts for more than 30 percent of the commodity
circulation in China, of which, the public sector takes up more than 20
percent, the collective economy, more than 10 percent, and other economic
sectors, more than 60 percent. During the 2001-2005 period, the country
will continue to promote and standardize the reform in restructuring and
withdraw small and mid-size State-owned enterprises from the public
sector through leasing or selling in a bid to establish a pattern of
commodity circulation shared by State-owned enterprises and share-holding
enterprises, non-public enterprises and foreign-funded enterprises.

Current situation of the retailing and wholesale sector

In 2000, the volume of domestic retail sales of commodities amounted to
3,415.3 billion yuan, an increase of 9.7 percent over the previous year,
of which 2,111 billion yuan was realized in urban areas, a 10.6 percent
growth; 1,304.3 billion yuan occurred in rural areas, an 8 percent
increase.

In 2000, the proportion of State-owned retail sales lowered in the total
volume of domestic retail sales of commodities. Of the domestic total
sales volume, 30 percent or more was public-owned, with 20 percent being
State-owned and 10 percent collectively-owned. The rest 60 percent was
shared by entities of other ownerships.

In 2000, retail volume of food, beverage, cigarette and wine sustained a
big increase of 28 percent, 62 percent, 61 percent and 108 percent,
respectively, over the previous year. Retails of garments and daily
necessities increased 20 percent and 17 percent respectively.

In 2001, the volume of domestic retail sales of commodities reached
3,759.5 billion yuan, up 10.1 percent over the previous year, of which
354.3 billion yuan were from urban areas and 1,405.2 billion yuan from
rural areas.

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