(Yicai Global) Aug. 6 -- Carrefour is gearing up to open a members-only store in China, the supermarket chain’s first in the country, with plans to launch many more over the next five years.

Yicai Global visited the first site yesterday. Located in the Pudong area of Shanghai, the outlet has been revamped from an existing hypermarket and is due to open in the last quarter of this year.

Carrefour China plans to open more than 30 members-only stores over the next five years to compete with the likes of Costco, Metro and Sam’s Club. With a supply chain covering 50 major cities, the conditions are there for opening membership stores, Vice President Chang Fei told Yicai Global.

Compared with ordinary supermarkets, members-only stores are usually warehouse-style supermarkets that focus on large-package goods and enjoy a competitive advantage by controlling operating costs and cutting product prices. The membership model has gradually been accepted by the Chinese public in recent years as consumer spending power has increased.

The Shanghai store is yet to open, but staff are already busy selling annual membership cards for CNY258 (USD40). That compares with Metro at CNY199, Sam’s Club at CNY260 and CNY680 for its Plus Membership scheme, and Costco at CNY299.

Carrefour entered the Chinese market in 1995. The French retailer expanded rapidly early on and secured a relatively large market share, but profits fell as competition increased. In 2019, it sold 80 percent of its loss-making China business to local retail giant Suning.Com for CNY4.8 billion (USD742.5 million).

Carrefour has more than 200 stores in the country, and over 75 percent of them are in first and second-tier cities, where people have strong spending power and Carrefour has built a loyal customer base, Chang said.

Editors: Dou Shicong, Futura Costaglione