Alibaba Group Holding Ltd's (NYSE:BABA) grocery retail chain Freshippo looks to add three new membership stores in January 2022, China Daily reports.
- Dubbed Freshippo Business Group-X Wholesale Store (X store), Alibaba will set up the three stores in Shanghai, Suzhou, and Nanjing in the neighboring Jiangsu province.
- Alibaba added one store in early December in Shanghai.
- The stores feature 16,000 - 20,000 square meters, each with around 3,000 stock-keeping units.
- The report adds that over 40% of products in the membership-only X store are the company's exclusive products.
- Retail giants like Costco Wholesale Corp (NASDAQ:COST) and Walmart Inc (NYSE:WMT) Sam's Club, known for the membership-only warehouse chain model, are flocking to set up a physical presence in China. The retailers aim to tap China's rapidly-expanding middle-income consumers aspiring for premium quality products at reasonable prices.
- The report quoted Jason Yu, general manager of consultancy Kantar Worldpanel, stating, "The membership-only model is still in its infancy in China, with more growth prospects expected not just from metropolises like Beijing and Shanghai but emerging first-tier cities such as Hangzhou over the next two to three years."
- Price Action: BABA shares traded higher by 0.05% at $112.15 in the premarket session on the last check Thursday.
