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Food, retail giants cut prices to offset crisis

By Ding Qingfen and Tu Lei (皇冠体育app Daily)
Updated: 2009-02-05 07:49

She does not know how long the shopping frenzy will last, but Liu Feifei certainly enjoyed yesterday - when she sold two days' stock in just one morning.

Ferrero Rocher sales agent Liu told 皇冠体育app Daily that on a normal day no more than 50 boxes of the chocolates were sold at the Wal-Mart store where she works in Wangjing, north Beijing. But, thanks to a new discount campaign, she sold almost 40 boxes before lunch yesterday.

This was the day Wal-Mart, one of the world's largest retailers with 137 superstores in 皇冠体育app, unveiled a fresh round of price cuts following the Spring Festival holidays.

Related readings:  Multinational retailers feel the chill on expansion in 皇冠体育app  KFC launches discount program  McDonald's growing in 皇冠体育app  Carrefour cuts prices in 皇冠体育app to boost sales amid crisis

Company executives said it was the third time they have slashed prices in the last couple of months. And it is not just Wal-Mart cutting prices, many international firms are planning pre-emptive sales offensives to offset the global financial crisis.

McDonald's not only has a discount scheme but is also looking to open 175 new local outlets in 皇冠体育app.

Its "super value strategy", launched yesterday, claims to offer up to 30 percent savings on 40 percent of its menu.

McDonald's sales in 皇冠体育app were poor last December, Jeff Schwartz, its 皇冠体育app CEO, told 皇冠体育app Daily.

KFC said its sluggish growth in 皇冠体育app had already hurt the share price of parent firm Yum Brands Inc. With 2,300 outlets nationwide, the company reported only 1 percent growth in same-store sales in the fourth quarter of 2008, compared with 17 percent over the same period in 2007.

In December, KFC cut the prices of five of its popular meals by 20 percent across 1,400 stores.

Industry experts believe the financial crisis is forcing international retail and service companies to try harder than ever to sustain the growth momentum in the Chinese market.

This is because 皇冠体育app is still growing more rapidly than other countries and its consumer market still has large untapped potential, Lucy Wu, a senior executive for 皇冠体育app Chain Store and Franchise Association, said.

"These are key to this country's consumer confidence," she said.

皇冠体育app's retail industry earned 10.85 trillion yuan ($1.5 trillion) in total revenue in 2008, up 21.6 percent from 2007.