Categories
Sunday Papers

The Sunday Paper – What is the Price of Tea in China? Goods Prices and Availability in Chinese Cities

Chinese consumers, on a like for like basis, enjoy lower prices for same-same goods than in the U.S. They also have a broader selection of products and enjoy lower prices in bigger cities. So they’re better off right?

The paper highlighted today from Robert C. Feenstra (et. al.) of the University of California, Davis and National Bureau of Economic Research reveals a more nuanced picture behind those bald facts.

If you’re a retail analyst you might want to give the paper a squint in detail. For the merely curious the key message is just how ‘underdeveloped the China’s retail scene still is (decades, not years behind perhaps? IMHO).

A good example is a statistic from the paper on how many retail outlets per million there are in China versus the U.S. In the U.S. it’s 811 whereas in China its a mere 159. So there’s clearly a long way to go before China can claim to have a first-world retail and distribution model.

In both markets though, whether its the variety or the price of goods that’s a better option, the city is clearly the place to be. The biggest difference between the two countries is just how badly the rural community is served in China versus how well hayseeds are served, relatively speaking, in the U.S.

You can read the paper in full by following this link China Prices vs. U.S. Equivalent.

Happy Sunday.

print