Value Retailers: Expert Call Takeaways — A continued durable winner amid structural channel shifts backed by resilient UE / ample infill potential

On Oct 23, Goldman Sachs hosted an expert call with a professional franchisee operating c.40 stores across multiple franchising brands including F&B value retailers, fresh snacks and CVS. The expert believes China's F&B value-retailer sector remains in an expansion phase, supported by structural channel shifts, regional whitespace and a competitive business model with resilient unit economics, evidenced by broadly on-track new-store ramp-up and resilient mature-store UE despite footfall dilution. All mature stores (about three quarters of the portfolio, opened before 2024) remain profitable YTD and have generally recouped initial investments. The expert sees the industry far from saturation, with potential for 100k+ stores long term versus c.60k currently operated by the two leading brands combined, and expects openings to continue next year at a slower pace via densification in mature markets and infill in underpenetrated regions such as Beijing/Hebei/Tianjin/Northwest China. Pricing