Upgrades likely to spark price war, squeeze out smaller rivals ParknShop will spend up to $150 million upgrading 15 of its superstores in a move that is likely to spark a new round of competition with arch-rivals Wellcome and China Resources supermarkets. The upgrades, aimed at providing one-stop shop services with more variety, will see the competition spill over into bakeries, fast food and Chinese roasted meat outlets and sushi stalls, with ParknShop planning to launch separate retail chains for these products. 'It is a new format of superstore, which expands the variety of products and organises them in a more shopper-friendly manner,' said Victor Tsang Kam-keung, the retail director of ParknShop, which is part of the Hutchison Whampoa conglomerate. 'We are targeting sales of the first upgraded superstore to grow at least 30 per cent after the upgrade.' Following the launch of the first upgraded superstore in Tai Po today, 14 more superstores will be revamped to include a specialised bakery, Chinese roasted meat, sushi, fast food, seafood, fresh meat and vegetable counters. The cost of each upgrade is between $8 million and $10 million. 'We see the potential of spinning off the bakery, sushi and Chinese roasted meat counters from ParknShops by setting up standalone chain stores,' Mr Tsang said. He added that the first store of a separate bakery chain was scheduled to open for business next year, with a floor space of about 1,000 square feet. A price war is looming in the already punishing food-retailing sector, with prices of Chinese roasted meat, fast food and vegetables about 10 per cent cheaper on average at ParknShop superstores than at traditional wet markets. A lunch box at ParknShop is available for as little as $9.90. Mr Tsang played down suggestions that ParknShop's initiatives would further lower the survival chances of smaller market players, saying that the market share of the supermarket chain accounted for only 10 per cent of fresh-food retailing. 'We're creating healthy competition,' he said. 'Competition will help lift industry standards.' In an aggressive diversification into sales of fresh pork and beef at discount prices recently, ParknShop was blamed for forcing smaller retailers of fresh meat out of business. It has also expanded into 24-hour convenience stores in prime tourist areas such as Tsim Sha Tsui and Causeway Bay. To cement its dominance in Hong Kong's supermarket segment, ParknShop planned to open 15 to 20 stores next year, Mr Tsang said. It already has 219 stores here, of which 52 are superstores.