U.S. consumer electronics retailer Best Buy says its retail strategy in China will focus on expanding its network into inland cities, where consumption is booming.
This move reflects a change in strategy for the seller of 3D televisions and other electronic devices. Last month, it said it would close self-branded stores in China and focus its business on the wholly-owned subsidiary Five Star, which has nearly 170 smaller stores in seven Chinese provinces.
Global retailers are eager to tap China's massive consumer market, but getting people in the world's most populous nation to open their wallets is not as easy as it seems.
U.S. toymaker Mattel confirmed reports that it had shut its six-storey flagship Barbie store in Shanghai, saying it wanted to focus on the broader Chinese market rather than just China's commercial hub.
Best Buy plans to open 40 to 50 Five Star stores in China in fiscal 2012, with the majority in less affluent cities.
Big retailers have traditionally catered to upmarket first-tier cities such as Shanghai and Beijing, where residents have higher incomes. But as more manufacturing groups shift production inland, consumer incomes in the interior are also growing.
