Friday, October 23, 2009

¥500/kg(or $160/lb) Beef Sold in China

Recently in China, various super markets started to appeal to the high-end luxury consumers by importing various food products from other countries and sell them as luxury food items in China. As the market becomes more saturated with numerous small super markets intended to appeal to the general public with the main strategy of lowering prices, competition between stores rose and big companies soon began to realize the much higher potential for profit at the other end of the spectrum. Thus, the luxury super markets are born.

Various stores such as the "International", the "BHG" and "Olé" import their products from countries over the world and redistribute them for a much higher price. According to reports various items like import fruits from Thailand sold for 100s of yuan per kg, imported European bread sold for 10s of yuan per loaf and even imported beef from Australia being sold for nearly five hundred yuan are now becoming a common sight in these luxury stores.

To put that into perspective, one US dollar is equal to 6.82 yuan. Which means that import fruits with price tags of up to $44/kg or $97/lb or higher(from a 300 yuan price), bread sold for $7.3 per loaf and beef sold for up to $73.22/kg or $161/lb are being sold as luxury items in China, where the average wage is approximately ¥1500 or $220 a month.

This may seem like a shocking development in the Chinese economical structure, but in reality, it was only a matter of time before the businesses recognized the business opportunities the growing upper middle class provided. With newfound wealth the demands for high quality products imported from foreign provided business with nearly limitless opportunities for profits. As of now, China is the world's second largest consumer of luxury products, having just surpassed in the most recent survey. Additionally, a research survey published by Abrams Research recognizes China as the largest potential market for future luxury products. At this rate it's no wonder why there's market for those beef.

But still, $161/lb beef?

Holy. Shit.

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