Multiple Pressures Make Chinese Entity Stores Facing A Survival Crisis.

about Beijing Mr. Yu, the wholesaler of the elegant market, has passed the golden age of China's economic boom. Chang Yu, who sells wigs in the elegant market, told CNBC that "eight years ago, when I was stationed in the market, there was a crowd of people everywhere." The market is no longer popular in the past.

In the past, Beijing's various stores were once proud of China, which provided goods for the western region and helped millions of people out of poverty. In the late 90s of last century and after 2000, the market was flourishing, and the vendors sold various products with minor flaws and cottages, attracting a large number of tourists.

Now, the business of the stall owners has been in a dilemma. clothing Ornaments are unsalable, and some wholesalers say they have never encountered such a bad market before. As China starts to get rid of its reliance on low-end manufacturing, shops rents rise and consumers begin to shop online. These entities must face the challenge of "survival or destruction".

　　 Production costs The rise has forced some foreign companies to shift their factories to some less developed countries in Asia. Thomas Orlik, economist at Bloomberg, said that the average wage of Chinese manufacturing industry has risen by 96% since 2007. Orlik said, "manufacturers are facing the problem of rising labor costs, rent and electricity bills, so shopkeepers have to share the pressure." Orlik said that in a Chinese metropolis like Beijing, real estate prices rose by 18% in 2013, despite the government's efforts to control the real estate market.

In the Xiushui Street market, a gold stall at a gold stall sells Jimmy Joy (Jimmy Joey) purse stall for 50 thousand yuan a month. The anonymous owner opened a shop online on Taobao a few years ago. Now the sales volume of online stores and Xiushui Street stores is much the same. The owner said, "I think the business of Taobao stores will become better, but the situation in Xiushui Street will not improve." Liu Yunchao, who sells sports shoes in Xiushui Street, said frankly, "every year, Xiushui Street's market is getting worse. There are too few people to shop here, and we plan to make changes. "

Nowadays, the online business platform provides consumers with more affordable choices, and people can pick products at random in hundreds of online stores. But Zhang Yongping, chairman of Xiushui Street, is not worried. He said that the future development model is simple: to provide high quality products at the lowest possible price.

Zhang Yongping said, "although our business is running in a market way, we manage Xiushui Street as a luxury shopping center. We will spare no effort to improve service and quality, provide better architectural design and interior decoration, and hope that Xiushui Street will become China's first high-end hypermarket. "

Analysts predict that Alibaba may soon become the world's largest company, but Zhang Yongping does not think customers will buy high-end products online. He said, "there are top shopping malls and the richest people in China near Xiushui Street, as well as many five star restaurants and embassies in Beijing. Our goal is to make Xiushui Street model in China within two to three years, or even the farthest possible entry into the US market."