China's grocery retail market to grow by a third by 2022

Date : 13 November 2018

10th November, China: The grocery retail market in China is forecast to grow by 32.6% to 2022, remaining the largest grocery market in Asia in 2022, according to new data released today by IGD, the international grocery research organisation.

Ahead of Singles Day, IGD unveils:

  • Grocery retail sales in China are set to amount to CNY 11.4 trillion by 2017 from CNY 8.6tn in 2017 – more than India, Japan and Indonesia combined
  • The market is expected to see a CAGR of 5.8% over the next five years, on par with Thailand but slower than markets such as India, Vietnam and Bangladesh, where the economy is growing faster
  • Globally, China will remain the second largest grocery market in the world by 2022, behind the US in value terms

Shirley Zhu, Programme Director for IGD’s Asia-Pacific research, says: “China continues to be an exciting market to watch with its significant size and rapid growth. Retailers with nationwide networks such as Sun Art, Yonghui, Walmart, CRV and Carrefour will reap rewards from ongoing expansion, partnerships with ecommerce players, improved efficiency and investment in small formats.

“Similarly, eCommerce giants such as Alibaba and will see significant growth from both online and offline channels and become the second and third largest grocery retailers in China, respectively. Regional players such as NGS, Wumart and Bailian will continue on their journey of transformation and consolidation and focus on profitability.”

China’s channel growth to 2022

Channel Change in Value
Change in Value
Online 929.9bn 285.5% 31.0%
Supermarkets 719bn 44.2% 7.6%
Convenience 672.9bn 65.5% 10.6%
Hypermarkets 221.7bn 12.0% 2.3%

Market share for hypermarkets and supermarkets will remain steady, close to 40% of the market up until 2022. However, the supermarket channel will overtake hypermarkets as the largest sales channel with a market share of 20.7%.

“Convenience will be the fastest growing physical store channel”, Shirley Zhu continues. “This will be driven by Alibaba and 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, we forecast online to contribute up to 11.1% of sales in 2022.”

Split of modern and traditional trade

Less than half of the grocery sales in China currently go through traditional trade. As the market continues to mature, traditional trade will keep losing share to modern trade, which currently accounts for about 57% of total grocery retail sales and is predicted to grow to 66% by 2022.

As the total market size is expanding, traditional trade will still grow but at a much slower pace over the next five years, with a forecast CAGR of 1%, compared with the growth of modern trade which is forecast a CAGR of 10%. The development of modern trade over the next five years will be largely driven by the strong performance of online and convenience channels.

To find out more about China’s significant growth and access more insights, download a free report on China’s grocery market in 2022.


Notes to editors:

  1. IGD is a not for profit research and training organisation. It has a trading subsidiary that provides commercial insight services for the consumer goods industry. The profits from these commercial services fund IGD’s not for profit activities. IGD Asia is the trading name for our Singapore based trading entity.
    All figures correct at time of going to press.
  2. Note on methodology – this data is derived from IGD datacentre. We conduct research from a wide range of sources, including company reports, analyst briefings, primary engagement with retailers and global news services. We have developed a standardised forecasting methodology that we apply to our research
  3. NOTE: numbers include grocery operations only and channels based on IGD global definitions, therefore may differ from those reported by the retailer
  4. IGD market sizes are ‘top down’, derived from national statistical bodies wherever possible. In all other cases, our market sizes represent IGD estimates and are based on a consistent methodology and knowledge of local markets. Grocery market sizes include all grocery sales through both modern trade and traditional trade formats
  5. Modern trade aims to cover all of the major organized grocery retailers in each country. It excludes wholesale and foodservice formats, as well as drugstores/pharmacies. IGD’s definition of ‘traditional trade’ includes sales from traditional retail formats, such as wet markets, artisan markets and traditional food stores.

For more information contact:
Alexandra Crisp on [email protected] or +44 7590 183295