(Yicai Global) June 21 -- Alibaba Group Holding’s supermarket chain Hema Fresh has opened northern China's first Hema X members-only outlet in Beijing.

The plan is to set up 10 Hema X stores in major cities across China this year, mainly in Shanghai, Beijing, and the Yangtze River Delta region, Hema X director, who goes by the name of Changyin, said to Yicai Global on June 18.

The 17,000-square meter Beijing outlet is the country's third Hema X store established over the past nine months. It delivers goods to areas as far as 20 kilometers away from the warehouse.

The main selling point is the grocery store's live seafood, including king crabs and crayfish, which sets it apart from others, said Liyan, store manager who used to work for rival Sam’s Club. The Beijing outlet is 12 km away from a Sam’s Club store, suggesting overlapping target groups.

“We only consider where our members are when we open a store, but not whether there are any rivals nearby,” said Changyin.

The Warehouse Club Craze

Warehouse stores are becoming increasingly popular in China. Inspired by the enlarging international giants, such as Sam’s Club and Costco, local supermarket chains, including Wumart Stores, Yonghui Superstores, and Fudi, have rolled out their plans to offer exclusive deals at special locations to members.

The business model targets the widening middle-class and China has 67 million middle and high-income households, according to Boston Consulting Group.

But there's still room for growth. The number of members of Hema X, Costco, and Sam’s Club has not passed five million in total in China, industry insiders told Yicai Global.

Hema opened the first Hema X store in Shanghai last October. The outlet became profitable in two months, and each client spent CNY1,000 (USD155) on average per visit, said Changyin.

Editor: Emmi Laine