China Launches Comprehensive 20-Measure Retail Innovation Plan to Transform Industry by 2030

China's Ministry of Commerce, working with eight other government departments, has released a comprehensive guideline to accelerate innovative development of the retail sector, targeting the establishment of a modern retail system by 2030. The initiative, announced on July 9, 2026, addresses fundamental structural challenges facing the industry including unbalanced commercial distribution, declining profitability, poor consumer experience, and unfair competition between online and offline retailers.

The plan comprises 20 specific policy measures organized around five key pillars: systematic planning of retail layout, upgrading product and service quality, coordinating existing and new capacity, ensuring fair online-offline competition, and strengthening policy support. By 2030, the government aims to create a retail ecosystem characterized by rational layout, quality supply, diverse business formats, smart convenience, and orderly competition. The initiative emphasizes cultivating globally competitive retail enterprises, developing compelling retail scenarios, and fostering innovative business models.

The guideline directly addresses competitive distortions in the market. It calls for strengthened anti-monopoly enforcement, standardized pricing practices, unified online-offline regulation, and elimination of false advertising and cost-shifting promotional schemes. Importantly, the policy signals a shift from purely price-based competition to efficiency-driven competition, discouraging platforms from using algorithms that rely solely on lowest price as the primary recommendation parameter and prohibiting forced subsidy burdens on merchants.

Digital transformation is a central element of the plan. Retailers are encouraged to digitalize their entire supply chains, including inventory management, logistics, and distribution. The policy promotes adoption of artificial intelligence applications such as intelligent customer guidance, low-altitude delivery, and unmanned retail. It also encourages the use of digital yuan (China's central bank digital currency) in consumer voucher distribution and settlement processes to enable more efficient fund circulation and targeted subsidy delivery.

The policy redefines the role of physical retail as a consumption infrastructure connecting urban planning, community services, employment, and national consumption circulation. It encourages retailers to transition from traditional revenue models—such as charging entrance fees and shelf fees—toward deep cooperation models including joint operations, self-procurement, and direct manufacturing. Large retailers are supported in expanding internationally through self-built channels, partnerships, and acquisitions. Small and medium retailers are encouraged to form collaborative alliances and voluntary chains for joint research and procurement.

Financial support mechanisms have been expanded significantly. The plan supports qualified retail enterprises to go public, issue asset-backed securities, and establish real estate investment trusts for commercial properties and community infrastructure. Financial institutions are encouraged to develop credit policies tailored to retail characteristics, and eligible retailers can access government lending subsidies for service sector enterprises. Enhanced financial support is provided for energy-efficient retrofitting and digital transformation projects. The government emphasizes that policy resources and work capacity should be directed toward supporting physical retail, with efforts to remove obstacles to implementation.