DFI Retail Group says it will continue to invest in Hong Kong supermarkets

Hong Kong-headquartered DFI Retail Group, which owns and operates the city’s largest supermarket network, says it will continue to invest in new stores even though consumers remain cautious.

Darren Chan, the group’s managing director for food in Hong Kong and Macau, said DFI – whose supermarket chains include Wellcome and Market Place in Hong Kong – was also “looking for opportunities to strengthen” its network where there was “clear customer demand and attractive long-term returns”.

“We invest in both new stores and our existing stores,” Chan said. “We open stores where they can better serve local communities, while continuing to modernise our existing network to ensure our store remains attractive, convenient and relevant to evolving customer needs.”

Wellcome, Market Place, 3hreesixty and Oliver’s operate a network of more than 325 stores serving more than 14 million customers a month.

Chan also oversees 3hreesixty, Oliver’s and San Miu, a supermarket chain in Macau.

In the first half of the year, DFI’s food division posted 1.4 per cent growth in sales to US$1.14 billion, although same-store sales declined by 0.2 per cent.

The group has been employing new strategies to improve sales as more Hong Kong residents travel to Shenzhen for cheaper shopping and dining options. They include broadening the number of countries it imports from to help bring prices down.

Wellcome and Market Place have recently teamed up with CJ Foods, South Korea’s largest food company, to enhance their Korean food offerings, with DFI saying the collaboration is expected to generate more than US$22 million in sales.

Meanwhile, Market Place recently launched “Taste of Australia”, a gourmet food fair featuring more than 70 Australian brands and over 200 new products including fresh produce, wines and snacks.

Chan said Wellcome’s real estate strategy would continue to feature large and small stores.

“There is no one-size-fits-all approach,” he said. “The optimal format depends on factors such as catchment demographics, customer shopping missions and local market opportunities.”

Hong Kong’s overall retail sales rose by 8.5 per cent year on year in the first eight months of this year, but stand-alone supermarket sales rose by just 1.4 per cent according to the Census and Statistics Department. Sales of all supermarkets, including those in department stores, rose by 1.5 per cent.

Formerly known as Dairy Farm, DFI also owns and operates Mannings, 7-Eleven and Ikea in Hong Kong. It also operates Guardian in Southeast Asia, 7-Eleven in Macau, Guangdong province and Singapore and Ikea in Macau, Taiwan and Indonesia.