Chinese grocers say they are confident of defending their position against US giant Wal-Mart, which last week set up a joint venture with China International Trust and Investment to run stores in Shanghai and neighbouring provinces.

Local supermarket operators are accelerating the pace of their nationwide expansion, overhauling their supply systems and pursing overseas money to ramp up their positioning prior to the Wal-Mart entry, reports CXN Media. The country's largest domestic grocer, Lianhua, paid ¥210m (US$25.3m) to buy a 50% stake in fellow supermarket operator Hangzhou Huashang. Lianhua also announced ambitious plans to increase the number of its outlets fourfold from the current 1,500 by the end of 2005.

Meanwhile Hualian Supermarket Co. is seeking to expand its network of stores by entering into more franchise agreements. It hopes in this way to quintuple the number of its 1,000 outlets by 2005.

just-food.com reported last week on Wal-Mart's push into China. To see our story, click here.