RT-Mart was China's top hypermarket chain — it closed 20 stores and lost ¥1.6B in one year

RT-Mart (大润发) was China's largest hypermarket chain, operated by Sun Art Retail (高鑫零售, 6808.HK), which Alibaba Group took a controlling stake in as part of its 'New Retail' strategy. At its peak, the chain operated hundreds of large-format stores across China, combining groceries, general merchandise and food courts under one roof.

The hypermarket model — large suburban stores designed for weekly car-borne shopping trips — was already under pressure from e-commerce, community group-buying and smaller-format convenience retail. The pandemic accelerated the shift. Sun Art's revenue declined for several consecutive years.

In fiscal year 2024, the deterioration became stark. Revenue fell 13.3% year-on-year to ¥72.567 billion. The company swung from a ¥109 million profit in 2023 to a ¥1.668 billion loss. Twenty hypermarkets were closed; four were being converted to membership-warehouse format. CEO Lin Xiaohai resigned in March 2024, recalled to Alibaba for other duties.

On 27 September 2024, Sun Art's shares were suspended on the Hong Kong Stock Exchange pending an announcement related to a potential acquisition under the Takeovers Code. The suspension signalled that Alibaba was exploring an exit from its New Retail investment.

Alibaba digitised the stores but kept the format; revenue fell 13.3% to ¥72.6B, swung to a ¥1.67B loss, and 20 hypermarkets closed.

The hypermarket format — 10,000+ sqm, car-dependent, weekly shopping — was misaligned with Chinese consumers' shift to daily delivery, group-buying and smaller stores

Alibaba's New Retail thesis assumed online-offline integration would revive physical retail; the integration was implemented but the underlying format continued to lose relevance

Revenue declined for multiple years before the 2024 loss, but the store network was not rationalised at the pace the decline demanded

The CEO's departure — recalled to Alibaba rather than staying to complete a turnaround — signalled that the parent company's commitment to the format was wavering

Digitising a store does not save it if the format is the problem. When shopping shifts from weekly car trips to daily phone orders, the square footage becomes a cost, not an asset.

Sun Art's share suspension in September 2024 preceded reports that Alibaba was seeking buyers for its stake. The case became a symbol of the retreat from China's 'New Retail' era, alongside similar pullbacks by other tech-backed grocery ventures. The membership-warehouse conversions represented an attempt to find a format that still justified physical space.