China on track to become world's largest grocery market, IGD
China will overtake the US to become the world’s largest grocery market by 2023 (in value terms), according to IGD Asia. The country’s total market size will reach CNY11.0tn ($1.8 trillion), more than Asia’s next four largest grocery markets (India, Japan, Indonesia and South Korea) combined.
Convenience will be the fastest-growing physical store channel, driven by Alibaba and JD.com transforming traditional mom-and-pop stores, retailers opening smaller format stores and both local and overseas players expanding their networks through partnerships. Online and offline integration will drive online growth. As the fastest-growing channel, IGD forecasts online to contribute up to 11% of sales in 2023.
E-commerce giants such as JD.com and Alibaba are set to see significant growth from both online and offline channels and become the second and third largest grocery retailers in China respectively. Meanwhile, retailers with nationwide networks such as Sun Art, Yonghui, Walmart, CRV and Carrefour will benefit from ongoing expansion, partnerships with e-commerce and tech companies, improved efficiencies and investment in small formats. Regional players such as NGS and Wumart will continue to focus on profitability.