20% large-scale retaiers running in the red

China Commercial Federation and All-China Commercial Information Centre issued the business report of 397 large-scale retail enterprises whose gross sales exceeded 100 million yuan on Apr. 3, which showed that loss incurred in 77 retailers among the total 397, eight more than that in 2003. So far the enterprises suffering from losses have accounted for 19.4 percent of the nation's total, up two percent from that in 2003.

However, China Commercial Federation did not release the name list of these enterprises in which loss incurred. But as reporters found out that most of the enterprises that suffered from losses were supermarkets and specialty shops. It is supposed that the rise of enterprises suffering from loss is closely connected with soaring increase of operating and management expenses in the enterprises.

As China Commercial Federation revealed, the average increase of operating expenses in these 397 enterprises stood at 19 percent, while that of management cost reached 10.5 percent. Particularly the expenses in specialty shops recorded the fastest increase with the average increase of management cost topping 36.29 percent and that of management expenses hitting 25.93 percent. Along with the increase of expenses, the profits of supermarkets and specialty shops fell sharply. The profits of supermarkets dropped 37.3 percent on an average, the sharpest among all the retail enterprises.

By People's Daily Online