Abstract
China being a highly appreciated country for its power in the global market and its rapid growth, enterprises are keen to invest in it in order to remain competitive. In recent years, China has evolved and developed rapidly in many areas. For this reason, many companies such as Carrefour, a French retailer, have begun to invest in China, the first European company and second in the world after Wal-Mart to do so.
Understanding how and why retailers want to invest in China explains the internationalization of Marks & Spencer in this market.
Firstly, it is important to define retailing. And it can be defined as the sale of goods or merchandise from a fixed location such as shops or stores, also known as retail establishments. Retailers are at the end of the supply chain and manufacturing marketers see the process of retailing as a necessary part of their overall distribution strategy. There are many formats of stores, the most important being the hypermarket. A hypermarket is a large retail store (minimum floor space of 2500 square metres in the UK), selling both food and non-food items. It is characterized by an optimized cost structure compared to other forms of smaller businesses (supermarkets, convenience, grocery and so on).
Concerning the market of retailing, there are 65 million potential customers in the UK and 1.3 billion in China. This is among the first reasons for investing in China. It's very interesting to understand why a firm like Marks& Spencer wants to invest in China and not in other countries.
China being an emerging country, in 1992, it opened its market to foreign countries. The foreign companies could also invest in China and they collaborated with Chinese companies and this resulted in a joint venture with the competitors.
