Beijing-based Wumart Stores — which has just announced plans to expand its business in East China — has decided to close one of its two stores in Shanghai.
The store, which has already been closed, was located on Siping Road.
Fu Yu, director for public relations of Wumart Stores said that the reason for closing the store was because the owner of the real estate wanted to reclaim it for a planned university city; and to cooperate with the government the company had to withdraw from the area.
Fu stated that this does not mean the company will change its expansion strategy in East China and the area will still be the development focus of the company. He added that if there is a proper opportunity in Shanghai, the Wumart will continue to open new stores and the company has already decided to open one more store in Shanghai.
With a large market share in northern markets such as Beijing and Tianjin, Wumart Stores has opened about 800 retail outlets, including supermarkets, hypermarkets and convenience stores. However, the company is weak in East China and it owns just 20 outlets in that area. To expand its business in East China, the company acquired a 85% stake in the Shaoxing Shangchao Investment Company for CNY151,177 million through its wholly owned subsidiary Hangzhou Tiantian Wumart Commerce Company in September 2008, giving Wumart indirect ownership of 54.09% of shares of Zhejiang Supply and Marketing Supermarket.
According to Wumart Stores, the acquisition is an important step for the company's expansion in East China and in the future, the company will continue to expand by acquiring leading retail companies in this area.