China online grocery market to reach $180bn by 2020

Joanne Denney-Finch, chief executive of IGD
Joanne Denney-Finch, chief executive of IGD
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China is set to rapidly outstrip its global competitors when it comes to growth in online food shopping.

Research found revenue from web-based grocery sales in China will rocket from its current $41bn (£26.2bn) to $178bn by 2020.

The growth will dwarf that of the UK’s more mature online retail market, where sales are set to almost double from $15bn in 2015 to $28bn in five years’ time.

China’s online grocery sector will be almost $70bn larger than the next top nine countries combined, the study from food industry research charity IGD found.

The UK is ranked second behind China, ahead of Japan, the US, France and South Korea.

Joanne Denney-Finch, IGD chief executive, said: “There’s going to be significant growth across all of the top 10 online grocery markets. This is being driven by busy shoppers making the most of more digital technologies and the rising trend of ‘anywhere, anytime shoppers’.”

China will further cement its position as the largest online market as more people get internet access through mobile devices, she said.

She said: “Given the size of its population, even a small change will have a significant impact.”

Most sales are made through online marketplaces in China, allowing international players to access the market.

Food is seen as an “affordable luxury”, while foreign brands offer reassurance over the safety threat of some locally-produced food, Ms Denney-Finch said.

As a result, companies such as Alibaba and Amazon have introduced specialist import sites.

While the size of the British market is dwarfed by that in China, the UK spend per person will still be almost four times that of the Asian giant’s, based on the latest population data from the World Bank.

China’s population of 1.36 billion people - as of 2013 - equates to roughly $30 per person in 2015.

In the UK, this jumps to $234 per person for the country’s 64.1 million population.

Using current data, Chinese shoppers could spend more than $131 online in 2020 - almost quadrupling current values.

British consumers will spend around $437 each.

The UK has always been a leader in online grocery shopping, Ms Denney-Finch said.

“Our latest research shows that three out of 10 British people bought their groceries online in the last month, with one in nine buying most of their groceries in this way,” she said.