China Resources' retail chain rethinks strategy to compete following ParknShop's upgrading and expansion moves Red chip China Resources Enterprise is rethinking its strategy for CRC Shop, Hong Kong's No3 supermarket chain, to fend off a fresh round of competition in the sector. This move follows a series of announcements by Hutchison Whampoa's supermarket arm ParknShop, which plans to upgrade 15 superstores, open 20 new outlets - bringing the total to 239 - set up a bakery chain and establish a chain of 13- middle to high-end Taste supermarkets. Although ParknShop's aggressive plans have triggered CRC Shop to react, the city's biggest supermarket chain operator in terms of store numbers, Wellcome, was taking a more low-key approach. Douglas Brown, marketing director of 241 Wellcome stores in Hong Kong, said: 'We don't comment on competition with ParknShop. The No1 thing consumers expect from a retailer is consistency in services. 'You don't need to come up with breathtaking new improvements all the time because people's shopping expectations for food don't change dramatically year on year. We are not like the fashion industry where you need constantly to come up with new styles, not like that at all.' ParknShop thinks differently, saying its decision to upgrade the superstores and open new stores is aimed at meeting consumers' changing needs, according to its retail director Victor Tsang Kam-keung. Mr Brown said Wellcome would open new stores in new towns and consolidate some existing stores. 'Opening a bunch of stores in existing areas doesn't make sense; it will take away business from existing stores,' he said. 'We want to have bigger stores and better locations.' Mr Brown added that Wellcome had opened 21 superstores in the past four years and by the end of next year, nearly all of the 241 stores would have been renovated. China Resources, which operates 86 CRC Shops, will continue to compete on prices, according to a spokeswoman. CRC also differed from its rivals by targeting lower to middle-income groups of customers, which explained why most of the shops were located in public housing estates, she said. To raise competitiveness, CRC had gradually added new features such as fresh fruit, seafood, sushi and bakery counters to its stores in the past few years. 'We will roll out a number of modified strategies in two to three months,' the spokeswoman said. Last week, ParknShop unveiled a number of new counters at its superstores, paving the way for the opening of separate chains of bakeries and stores selling sushi and Chinese roasted meat. Analysts said the move would fuel competition in other retailing segments and change consumers' shopping behaviour.