China retail sales rise again after Covid-19 outbreak

1 min readUpdated May 15, 2025Sep 17, 202011:00 PM

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Officially released data for retail sales in China show a rise for the first time this year as the economy recovers from the impact of the coronavirus.

Figures for August showed a year-on-year increase of 0.5 percent in retail revenues. Dramatic increases were seen in sales of communication equipment (25.1 percent) and automobiles (11.8 percent).

By contrast, figures for the months previous to August this year showed a drop of 8.6 percent, during which time online sales increased by 15.8 percent.

China’s economic recovery has been fuelled by pent-up demand, government stimulus, and strong exports.

“We think that China’s economic recovery is on a reasonably firm footing now and should continue through the fourth quarter and into 2021,” Oxford Economics head of Asia Louis Kuijs said, “with solid investment growth, gradually recovering consumption momentum and resilient exports.

China’s industrial output also accelerated at the fastest rate this year during August, according to data from the National Statistics Bureau.

“We expect a further, albeit gradual, recovery of the services sector, a steady improvement in retail sales and elevated fixed-asset investment growth, said Nomura’s chief China economist Ting Lu.

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What this means

China's retail sales rebound, driven by pent-up demand and government stimulus, suggests a robust recovery, but the underlying shift to online sales during the downturn (15.8 percent increase) poses a challenge for traditional brick-and-mortar strategies. While Louis Vuitton previously reduced its Southwest China footprint, and Kau Kee Food Factory opened its first store in Hong Kong, the overall market points to a nuanced landscape. Retailers must adapt quickly to use the renewed consumer confidence while maintaining strong digital channels. This pressure on physical stores mirrors Panpuri's planned 16-store Asian expansion, which specifically targets China, indicating a belief in targeted physical growth. Future performance will hinge on how effectively retailers integrate omnichannel strategies; watch for next quarter's digital sales versus in-store performance breakdowns.

Minjun Park · Retail News Asia newsroom

Questions & Answers

What was the overall retail sales increase in China for August?

Figures for August showed a year-on-year increase of 0.5 percent in retail revenues. This is the first rise this year as the economy recovers from the impact of the coronavirus.

Which specific product categories saw significant sales growth in August?

Dramatic increases were observed in sales of communication equipment, which rose by 25.1 percent. Automobile sales also performed strongly, showing an increase of 11.8 percent during the same period.

How did online sales perform compared to overall retail sales in the months before August?

In the months prior to August this year, overall retail sales dropped by 8.6 percent. However, online sales increased by 15.8 percent during that same period, showing a contrasting trend.

What factors are driving China's economic recovery according to the article?

China’s economic recovery has been fuelled by several factors. These include pent-up demand, government stimulus measures, and robust exports. Industrial output also accelerated significantly in August.

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