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Tesco slows down expansion
China
Monday 27 August 2012
MD
The explosion of wage costs and commercial rents has led to the slowing down of Tesco's expansion in China.
Announced as a strategic change in direction, the decision to close supermarkets reflects declining performance.
Tesco, the third largest supermarket chain, will close four supermarkets in western and northern China. These closures in less developed cities reflect a slowdown in performance. Labor costs of stores rose in 2011
by 26% and rents by 10%.
According to experts, the costs will continue to increase over the next 4 years. This more difficult economic environment will force supermarkets to slow expansion plans.
Tesco entered China in 2004 and has established a network of over 100 stores in all provinces in China.
According to experts, the costs will continue to increase over the next 4 years. This more difficult economic environment will force supermarkets to slow expansion plans.
Tesco entered China in 2004 and has established a network of over 100 stores in all provinces in China.
source : global times cn, down jones newswires
