| dc.description.abstract | This paper through an economic viewpoint studies the origin and development of modern hypermarkets（or warehouses） in Taiwan, which includes the opening process, business policies, the characteristic of firms, industrial environment and the flux of market structure. Then, it compares the hypermarkets（or warehouses） industry of Taiwan and Mainland China, and discusses the advantages of Taiwan’s firms entering the Mainland China market.
After the entry of modern hypermarkets（or warehouses） in Taiwan, the know-how and low-price strategy of the foreign firms have changed the habits of Taiwan’s consumer. It has also changed the operating mode of Taiwan’s traditional firms.
Taiwan’s government takes open attitude to retail business. Under free competition, foreign firms own higher market share because of their advantages in capital, know-how and brand image. Relatively, most local firms didn’t engage in retail business in the past. Most of them were manufacturing firms, and their purpose of getting into distribution industry is in order to strengthen stability of products transport. However, most local firms couldn’t expand their chain stores continuously because of their smaller scale and lack of capital.
Furthermore, the hinterland of Taiwan is so small that the space of development is limited. Hypermarkets（or warehouses） firms must integrate manufacture, wholesale and retail. They also could achieve scope economies across retail formats. There has been a decrease in number of firms and hence a tendency toward an oligopoly. Nevertheless, because of well-developed communications, excellent information and plentiful choices in Taiwan, individual firm has no strong market power. It resulted in a competitive retail business.
In the meantime, Mainland China owns extensive land. The communication and transportation is highly inefficient. The government enforces the policy of experimental units to foreign firms. The restrictions of operational region, numbers and shares to foreign firm rescinded until the end of the year 2004. It’s the reason that expansion of foreign firms was slow.
Firms from Taiwan entering into the Mainland China market have advantages in terms of policies, language and culture. Their expansions were faster than other foreign firms. After complete openness of retail business in Mainland China, nevertheless, firms from Taiwan may look for partners because they lacked capital and scale comparatively. | en_US |