A woman uses the self-service machine to weigh the products in a Yonghui superstores in Fuzhou, Fujian. (Photo by Chen Hao/For China Daily)
Yonghui Superstores reported that operational income in the first quarter reached 15.3 billion yuan ($2.3 billion), a jump of 13.8 percent compared to the same period in 2016.
It also exceeded analysts' expectations. "When the entire retailing industry is shrouded in gloom, Yonghui Superstores has come up with a totally different story," said Wang Liting, a senior analyst at Haitong Securities, in Shanghai.
"Quite simply, it has integrated its supply chain and created new business models," he added. "We expect the company's annual income growth rate will remain at around 20 percent in the next five years."
Yonghui Superstores has certainly managed to buck the trend for "bricks-and-mortar" retailers.
Statistics released by the China Commerce Association for General Merchandise showed that 150 department stores have been closed between 2012 and 2016, with 100 going to the wall last year.
Soaring rents have been a huge problem as they have nearly doubled in the past five years in first-tier cities, according to WinShang Commercial Property Intelligence Center in Guangzhou.
Rising labor costs have been another huge burden.
Figures from the Pudong Innovation Research Institute in Shanghai showed that the average annual income in major cities, such as Beijing and Shanghai, increased by 10 percent in 2016.
Lannes of Bain & Co, agreed that traditional retailers have struggled in the past five years, with sales contracting 10.4 percent in some sectors as stores are forced to close down.
"Retailers have to bring together online and offline businesses, logistics and data to integrate them onto a single value chain and redesign the retail industry," he said.
