China’s retail sector has enjoyed dramatic growth as a result of adopting economic reforms.While western retailers are currently experiencing reduced expansion and declining sales in their home markets，their Chinese counterparts are still experiencing double-digit positive growth.But the Financial Crisis started from 2008 gave some uncertain infection on the retail industry.

Against the backdrop，Pricewaterhouse Coopers China（PWC）worked with the China Chain Store & Franchise Association（CCFA）to conduct a benchmarking study of the top retailers in China to indentify the opportunities and risks.In this study，we evaluated the current revenue，profitability and balance sheets of the 52 listed retail companies in Chinas.Our research and analysis focused on domestic largescale retailers，which include department stores，supermarkets and specialty stores.

The good news from the study is that the majority of retailers surveyed still maintained strong cash reserves，but strong cash flows will be necessary as access to capital remains scarce.We anticipate that most retailers will instead invest their capital in improving current store infrastructure.

The study also found that a preference of retailers in China is to use short-term，operating liabilities to fund their assets.In many instances，retailers are using this“free”funding to fuel growth and support their capital expenditure programs.