“While shopping from convenience stores is almost universal among urban consumers, there is an increasing need for chains to adapt their products, services and stores to suit the individual needs of different customers and communities. As competition heats up in developed cities, and expands into new ones, developing business models to suit local needs will become increasingly important.
Part of the wider product and service offering is the growing role for convenience stores in acting as online-to-offline retail delivery points. This can help stores to provide more products and services, but also create a new way for convenience stores to engage with their consumers, including via loyalty schemes and social media.
Providing more in-store catering is a continuing trend, but consumers are also demanding bigger, cleaner and brighter stores, with more variety of products, friendlier staff and more competitive pricing, including private label. Convenience stores can no longer rely on convenience alone, and must also compete across a wider spectrum of brand offerings.”
In this report, Mintel answers the key questions:
Why are convenience stores continuing to see faster outlet and sales growth than any other retail sector?
How are convenience stores generally increasing in size, selling a wider variety of products and providing consumers with more services than before?
Which retail chains are innovating and growing fastest in the sector?
How are convenience stores increasingly integrating into the online-to-offline trend in modern grocery retail in China?
What do consumers like about convenience stores, and which products and services do they buy the most often?
What do consumers dislike about convenience stores, and therefore what can they do to become more competitive?
What are consumers’ attitudes towards convenience stores, and their shopping habits and preferences?
Definition
According to the National Standard Retail Business Category (GB/T18106-2004), convenience stores are defined as a small-store grocery-focused retail format which offers convenience service for people needing to undertake top-up shopping or make distress purchases. The sector has also become increasingly prominent in consumers’ last-minute meal shopping. Convenience stores can be located in residential areas, at metro stations, in commercial areas, near places like hospitals, colleges, entertainment venues, in office buildings, at petrol stations, etc.
In practice, convenience stores should:
Be open seven days a week and have 16-24 hours of operational store opening times;
Sell an extended range of goods including a range of known-value items such as food, drinks, basic household groceries and newspapers. Cigarettes, however, are only sold in the local chain convenience stores due to government policies;
Provide a range of services, including, but not limited to, mobile phone top-up, utility bills payment, credit card repayment, and parcel delivery;
Serve a local community within easy reach by foot or by bicycle;
Usually trade from a unit around 100 sq metres in size.
The following are excluded:
Hole-in-the-wall stores;
Independent mom-and-pop grocery stores;
Petrol station convenience stores;
Rural convenience stores, which are operating on a much smaller scale, with a floor area of 60-70 sq metres. Most of these stores in the countryside were originally mom-and-pop stores and are in the midst of transforming into convenience stores under the Government’s rural retailing network program. The variety of goods sold and services provided in these stores is quite limited, and these stores’ standards may not be up to par as compared to those in urban areas. Under such consideration, these stores are not included in the market size, brand share data and consumer research in this report.
However, as there are a growing number of traditional grocery stores that have been upgraded and transformed into modern minimarts after joining leading chain stores, these minimarts often provide similar services to those offered by convenience stores and operate 12 hours a day or some even more, and due to its small size, it is difficult to differentiate between these and convenience stores. These minimarts are excluded from the market size.
Methodology
For the purpose of this report, Mintel commissioned a quantitative research survey carried out online to explore consumption and attitudes of consumers, aged between 20 and 49, towards shopping in convenience stores.
Fieldwork was conducted in January 2015, in four tier-1 cities, six tier-2 and tier-3 cities. The tier-1 cities include Beijing, Shanghai, Guangzhou and Chengdu. The tier-2 and tier-3 cities included Changchun, Zibo, Nanjing, Jinhua, Xiamen and Xi’an.
This is a marketing intelligence report published by Mintel. The consumer research exclusively commissioned for this report was conducted by a Chinese licensed market survey agent (see Research Methodology China for more information).
