Costco opens first store on Chinese mainland

China’s First Costco Closed Early on Opening Day From Overcrowding Raucous Behavior

People visit the first Costco outlet in China on the store's opening day in Shanghai on Aug. 27 2019

The crowds were so out of hand that Costco made a decision to shut the store down by early afternoon of opening day (Tuesday, August 27).

While it may seem Costco's entry into China has been well received, it has to compete with the likes of Alibaba and JD.com, which have opened omnichannel supermarkets like Hema.

By noon, the store was begging customers not to come to the store via text message.

All in all, the Costco only managed to remain open till 1:40 p.m. - just five hours after it first opened. Carrefour SA sold 80% stake in its China unit at a discount in June while German wholesaler Metro AG is looking to sell its operations.

Empty carts piled together as people shop in Costco in Shanghai, China on August 27, 2019. Bargain-hunters reportedly overwhelmed the store that day, causing "chaotic...bust-ups between anxious shoppers", according to a local interviewed by the South China Morning Post.

Costco didn't immediately answer phone calls and an online inquiry seeking comments on Tuesday's shopping frenzy. Chinese consumers love American products. - China has proved a brutal battleground for overseas food retailers in recent years, with many failing to understand consumer habits and tastes as well as local competitors building a stronger presence. However, according to Shine.cn, after the initial excitement wore off, many customers ended up feeling unsatisfied with the prices at the outlet, complaining that, apart from ultra-cheap eggs, they weren't much different from other grocery stores. "The Chinese market still has great consumption power, particularly for high-end goods".

"For your safety, we hope citizens who want to go to Costco can maintain a rational attitude about consumption and avoid going out during rush hours". Zhang told the wire service that about 50 percent of the products are from overseas and that some fresh produce items from the US have been replaced with items from Australia.

The spokesman said the store, which sprawls out over 150,000 square feet in Shanghai's southwestern suburbs, planned to open as normal on Wednesday. -China trade war could complicate the company's supply.

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