Source | Lingshou

The "Clear-Headedness" in Discount Stores

On a Sunday afternoon in Zhuozhou, the sun was not particularly bright, but a short queue had already formed outside a discount supermarket on a street corner. In the queue were a young mother holding a baby, a middle-aged woman with a vegetable basket, and a couple of white-collar workers with backpacks. They came out of the store carrying bags of groceries: promotional honey packs, 2-in-1 shampoo, half-price snacks, and packs of instant noodles labeled "clearance sale." Some customers left with full bags of goods, having spent only a few dozen yuan.

Inside the store, some people compared prices on their phones, while others muttered, "Income has decreased; we need to learn to live within our means." Similar scenes were unfolding in a discount store in Beijing's Chaoyang District. At 8 p.m., the store was still bustling. In front of a row of freezers, a young couple was carefully comparing products. The young man picked up a bottle of sparkling water from a well-known brand, while the young woman shook a similarly packaged product from a lesser-known brand and said, "This one is also made by the same OEM factory, with similar ingredients, but it's half the price." A few seconds later, the well-known sparkling water was quietly put back. Another young woman skillfully placed a box of imported brand shampoo into her shopping basket. "These items might be 30% to 50% more expensive in regular supermarkets or e-commerce platforms," she said.

Such consumption scenes are becoming more common, not only in small cities but also in core first- and second-tier cities, where more people are starting to visit hard discount stores. Once, the call for consumption upgrading was loud, and people were enthusiastic about paying for brands, design, and emotional value. Now, the situation is completely different. The trend of "hard discount" is sweeping across China's retail market at a pace of adding several or even dozens of new stores each month.

On August 16, 2025, JD.com opened its first discount supermarket in Zhuozhou, covering over 5,000 square meters and offering more than 5,000 SKUs, including daily necessities and fresh food. On the first day, it received nearly 60,000 customers. On August 30 of the same year, four stores in Suqian opened simultaneously in the city center, Siyang, Sihong, and Shuyang, collectively receiving over 300,000 customers in a single day.

On August 29, Meituan's "Happy Monkey" opened two stores in Hangzhou, each covering 800-1,000 square meters, with product structure and operating model benchmarked against Hema NB, focusing on hard discount. On the same day, Hema's budget community supermarket, Hema NB, was officially renamed "Super Hema NB," with NB standing for Neighbor Business. New stores opened in 10 cities across Jiangsu, Zhejiang, and Shanghai, totaling 17 new stores, and entering new cities like Ningbo. As of September, the total number of Super Hema NB stores (including the original Hema NB stores that were gradually renamed) approached 300.

Not only are internet giants entering the physical discount supermarket track, but traditional hard discount stores are also rapidly expanding their market presence. For example, ALDI, the German hard discount supermarket brand, officially opened its first offline store in China in 2019 and has been refining its store format to adapt to the Chinese market. In March of this year, it launched its "Out of Shanghai, Into Jiangsu" strategy, beginning its expansion journey and adding seven new stores in Suzhou, Wuxi, and Changzhou. As of the end of September, ALDI China had 79 stores, with 71 in Shanghai and 8 in Jiangsu. ALDI adheres to the philosophy of "good quality, low price," reducing costs by streamlining SKUs, deepening its private label (accounting for 90% of products), and optimizing its supply chain, winning a large following. In October 2025, ALDI completed a management adjustment, with Chen Jia taking over as CEO to drive supply chain and quality control optimization.

Additionally, Walmart has been experimenting with a new generation of community stores. As of September 2025, Walmart has opened four community stores in Shenzhen and is rapidly scaling up. These are not just smaller versions of hypermarkets but a complete model redesign: small areas carrying high-frequency essential needs, quality ensured through selected private labels, and consumer mindshare stabilized with Everyday Low Price (EDLP). With 2,000 SKUs, nearly half being private labels, and an EDLP strategy, along with a "9.99 yuan price band" covering bakery, juice, instant food, and other categories, this is also a discount model for the store format.

Hard discount stores are no longer inconspicuous "clearance" shops on street corners; they are now entering core business districts, attracting all customer groups with bright lighting, simple shelves, and highly impactful price tags. Hard discount stores have thus shed their "marginal business" identity and become the central battlefield in the retail arena.

This is not accidental. Walking into any hard discount store, you see not just products but a mirror reflecting the current Chinese consumer mindset—an unprecedented "clear-headedness" is becoming mainstream.

Why Can Hard Discount Rise Rapidly?

Discount stores are not a new concept; they have existed in China for decades. Why has hard discount become mainstream in the past two years, with a surge in store numbers, major players entering, and frequent media coverage? "Lack of money" may be the true underlying driver of the rise of hard discount stores. Slowing income growth, rising rigid expenditures, and expectations of asset depreciation have shifted consumer mentality from "pursuing better" to "avoiding waste." When income uncertainty becomes the norm, discount consumption is no longer a "last resort" but a rational choice.

In the past, when China's economy was booming, the call for consumption upgrading was loud, and people were enthusiastic about paying for brands, design, and emotional value. Now, as the economy enters the "new normal," "tightening belts" has become the choice for more people. In other words, the economic "new normal" is the key to the rise of hard discount stores this round.

According to data from the National Bureau of Statistics, China's GDP growth rate has fallen from 6.9% in 2017 to 5.2% in 2023. This shift in the macroeconomic backdrop directly affects individuals' wallets. More importantly, residents' expectations for future income have undergone a fundamental change. In terms of disposable income, data show that the growth rate of per capita disposable income of national residents is in sync with the GDP growth trend. Looking back at 2019 before the pandemic, per capita disposable income of national residents grew nominally by 8.9% and actually by 5.8% after deducting price factors. By 2023, per capita disposable income of national residents was 39,218 yuan, with nominal growth of 6.3% and actual growth of 6.1% after deducting price factors. The slowdown in growth is an indisputable fact. More importantly, the growth rate of per capita consumption expenditure, which reflects social consumption vitality, has at times been lower than the growth rate of disposable income, clearly indicating that "saving for safety" rather than "active consumption" is becoming the prevailing mentality among social groups.

When the firm belief that "the future will be better" is replaced by the caution of "increased uncertainty," the core logic of consumption decisions quickly shifts from "I want" to "I need." Consumers begin to scrutinize the necessity and rationality of every expenditure like experienced financial officers.

Of course, there is another crucial factor: Why are the "statistics" growing, but consumers' feelings are completely different?

Numbers Rise, Wallets Shrink

Analysts have explained the contradiction between data growth and real-life feelings.

First, the data is indeed "rising," but it's the average that rises, while hearts feel more "tight." Over the past two years, the National Bureau of Statistics' numbers have not been bad; they could even be considered good. In 2023, per capita disposable income of national residents was 39,218 yuan, up 6.3% year-on-year, with actual growth of 6.1%. In 2024, this figure rose to 41,314 yuan, up 5.3% year-on-year, with actual growth of 5.1%. Logically, if income rises, consumption should be stronger, but the street-level feeling is completely opposite: fewer people in malls, lower average spending per customer in restaurants, and discounts becoming the norm. These numbers themselves are not problematic, but they are "national averages," not "the income of most people around us." Averages can be pulled up by high-income groups. This can, to some extent, explain why data is rising but people are more reluctant to spend. The answer on the streets is simple: "I'm still earning, but I dare not spend." This reluctance is not simple frugality but a sense of uncertainty about the future.

Second, the "average" masks some divergence. The growth in numbers does not mean growth for "everyone." The statistical "per capita" income is an average pulled up by high-income groups. When the income of the top earners remains strong while the income of the middle and lower classes stagnates or declines, the overall average can still show "moderate growth." But for ordinary people, the median is the truth. On one hand, there is stability for those in finance, technology, and government sectors; on the other hand, there is struggle for those in manufacturing, delivery workers, and small entrepreneurs. The silence of the median creates a huge gap between perception and data. This means China's income structure is becoming stratified: a minority maintains growth, while the majority enters a defensive mode. Numbers go up, but sentiment goes down.

Third, "statistical money" and "money in hand" are not the same thing. The "disposable income" in statistics is much broader than you might think. It includes not only wages and net business income but also transfer payments, social security, welfare, and housing provident funds—"book income." Not all of this can be immediately cashed out or used. In real life, many people's "cash flow income" is declining. Bonuses are canceled, commissions reduced, orders decrease, and performance pay is delayed, resulting in less money actually available to spend. On paper, money is rising; in the wallet, it's shrinking. This is not a statistical data problem but a mismatch between statistical caliber and real life.

Fourth, it's a wound of expectation: it's not about lacking money, but fearing the lack of money. In economics, there's a term called "precautionary saving"—when the future is uncertain, people instinctively increase savings and reduce consumption. Over the past three years, Chinese people have generally experienced "confidence tightening": rising employment pressure, housing price fluctuations, corporate layoffs, and investment losses have lowered expectations for future income. This psychological effect is stronger than actual income changes—it replaces the impulse to "dare to spend" with the rationality of "keep some in reserve." Central bank data for 2024 shows that household deposits reached a new high. The money hasn't disappeared; it's just "lying" in banks. The boom in discount stores, second-hand trading, and dupe brands is a social expression of this psychology.

Fifth, expenses are more expensive: what's rising is not income but the cost of living. Another often-overlooked reality is that although money has increased, it doesn't stretch as far. Over the past year, rigid expenditures such as education, healthcare, and transportation have continued to rise, while non-essential consumption like food, entertainment, and clothing has been discounted and promoted. This means people's "discretionary spending range" is shrinking. A simple example: if wages rise 5%, tuition rises 10%, and rent rises 8%, the "feeling" is naturally that income is falling. This "structural inflation" is causing both the middle class and wage earners to tighten their wallets. They don't want to spend; they just don't have money to spend freely.

It's worth noting that confidence matters more than numbers. Economic growth depends on investment, exports, and consumption. And consumption depends not on the absolute value of income but on confidence. When a person believes the future is predictable, income is stable, and assets can maintain value, they will naturally spend. When they worry the future will be harder, even if they have money today, they will postpone consumption. This is the core contradiction of "statistical growth and consumption contraction": data describes past income, while consumption depends on future confidence.

This also explains why consumers are becoming more conservative, focusing more on cost-performance and quality-price ratio. The core of hard discount is: minimal SKUs, strong supply chain control, low gross margin with high efficiency, and ultimate quality-price ratio. The macro situation and the hard discount philosophy "click" together, making the rapid rise of hard discount in the past two years logical.

Hard Discount Is a Retail Efficiency Revolution

Walking into any hard discount store, you can more intuitively feel the high efficiency: the decoration is minimalist industrial style, because every bit of fancy decoration ultimately gets paid for by consumers; the number of SKUs is usually only one to two thousand, one-tenth of a traditional supermarket.

Ultimate single-item scale: operate each SKU like a "hit product," compressing procurement costs through massive orders;

Private label is king: bypass brand owners, directly connect with factories, stripping away the biggest "water" of brand premium;

Extreme compression of operating costs: shelves are the warehouse, reducing secondary handling; encourage self-service shopping, reducing labor costs;

Digital precision guidance: use big data to predict sales, achieve "production based on sales," near-zero inventory, and minimize losses.

Some people describe the difference between hard discount and traditional supermarkets like this: the traditional retail approach is to find ways to sell something worth 1 yuan for 10 yuan. The hard discount logic is to do everything possible to produce something worth 1 yuan at a cost of 8 mao, and then sell it for only 1 yuan 1 mao. It doesn't earn a premium but a thin but stable margin from efficiency gains.

The rise of hard discount stores began as a helpless choice for consumers who "have no money" during the economic downturn. But its story may not easily end as the economy recovers. This wave set off by hard discount is essentially an "efficiency revolution" sweeping across the entire manufacturing and retail industries. It is mercilessly questioning every brand: Is your product really worth that price? It is also forcing every traditional channel: Does your link create irreplaceable value?

In this era of rational price awakening, saving money is becoming a new faith. And hard discount stores are the liveliest corner of it.

From another perspective, the rise of discount stores, the prosperity of second-hand platforms, and the popularity of dupe products are not "consumption downgrading" but a rational return. They represent a society's self-regulation in uncertain times: people no longer blindly pursue more expensive things but pursue things that are more "worth it." Data can show us growth, but only confidence can turn growth into real life.