Only just separated from former mother holding Carrefour, hard discounter Dia has already made an important and remarkable decision for the Chinese market: it will switch its attention from discounters to supermarkets. Yesterday PlanetRetail reported about this move, that would have been impossible while Dia was still under Carrefour's wings – even though Carrefour has no supermarkets in China.
Dia, whose projected format for China is one of 500 m² supermarkets focussing on fresh and frozen food products, seems to be very much in touch with the changing demographics in China. Much like in Western Europe, society in China is ageing – but the Chinese change happens considerably faster because of the one-child policy.
Martin Walker, senior director of AT Kearney’s Global Business Policy Council, launched the idea of an 'agequake' on the Consumer Goods Forum Global Summit last month: the population pyramid in many countries is disappearing as birth rates decrease and people live longer. In 2047, Walker predicted, the Earth could for the very first time see the number of over-60s exceeding that of the young. “People over sixty generally prefer smaller local stores over discount stores or hypermarkets, as they need smaller quantities and often do not use a car to go shopping”, he said.
Carrefour has created its own competitor
While China is clearly the best place for Dia to start this change in focus, both because of the speed of ageing and the lack of Carrefour's supermarkets, it is very well possible that Dia supermarkets will appear elsewhere too. Specialists point to countries like France, Spain, Portugal, Turkey, Brazil or Argentina, where Carrefour has invested significantly in supermarkets and hypermarkets. As such, Carrefour might have created a very strong challenger in markets that are of critical importance to the French hypermarket giant.
(You can find Martin Walker's report, The maturing consumer, here).