Your present position: Home » Investment Environment

Life Service

Issuing Date: 2015-12-09   Author:Editor of site   Source: Author of Site   Views:

It is more open for foreign involvement and progressively internationalized.

Shanghai’s life services are more open as it takes the opportunity of China (Shanghai) Pilot Free Trade Zone. Efforts have been made to promote the regulated opening of education, cultural, healthcare, and tourist services, lift the restriction on foreign capital in baby care, elderly care, retail & wholesale, logistics, and e-commerce, and create a new structure for life services with joint participation of state, private, and foreign capital.


Life services are growing rapidly in terms of volume and portion.
In 2014, the added value of life services in Shanghai exceeded 484 billion RMB, accounting for 32% of the added value of the whole services sector and 21% of the city’s GDP. Employment of life services totaled around 4.5 million.


Key services grow faster and structures are optimized.
Catering, home service, appliance reparation, hairdressing & beauty, bathing, laundry, photographing, marriage services have been regulated, facilitated and modernized. Emerging life services such as cultural, tourist, sports, and healthcare services are growing rapidly and tuning more personal, diversified, and innovative. Meanwhile, a robust chain of life services has taken shape via promoting the development of relevant sectors.


New technologies and business models emerge, demonstrating strengthened dynamism.
Combined with Internet technologies, traditional services sectors can integrate and restructuring “offline” business to achieve the consolidation of cash flow, information flow and cargo flows and rejuvenate traditional business.


Different types of business expand their presence and regional features are highlighted.
Traditional life services such as retail are growing rapidly and commercial facilities and theme commercial districts have fundamentally realized differentiated development. Efforts will be made to promote emerging life services, home services, cultural services, tourist services, and sport services.


Four types of development in life services

Community service model   Community commercial center is a closely located network of comprehensive services such as retail, restaurant, leisure, cultural, entertainment, sport, and healthcare services. The center is able to cover a large community with a complete range services and caters to the “one-stop” shopping and consumption needs of community residents.


Concentrated service mode   This model usually takes the form of a street, such as food street and photograph street. This model puts brands together, generates concentration effect, promote business development, and shape the chain of services.


Embedded model   This model Embeds life services into manufacturing services. For example, establish hotel and catering services in CBD or HQ district.
Life service group purchase model   Establish life service group purchase websites based on Internet technology and create the pattern of “online group purchase + offshore consumption + comments”. This caters the needs for cost-effective life services and diversified needs for various life services. Meanwhile, it also supports tenants with brands and guarantees and realizes the purpose of both promotion and distribution.


Challenges to the life services


Business scale and service capacity is low.   The portion of life services as of the total service sector and as of GDP is still low. Resources per capita, especially the public service resources, are comparatively short. In 2013, Shanghai’s GDP per capita was 85,000 RMB or approximately 13,000 USD. Service consumption took up 30% of total expenditure while the figure was over 50% in the US, UK, Japan, Hong Kong, and Singapore of the same year.


Business structure was inappropriate.   Retail services are outstanding while other services lag significantly behind. Tradition life services grow rapidly while standardized and chained modern services lag behind.


Geographic locations are to be optimized.   The city lacks mid-and-long-term planning for the development of life services and some of service infrastructures are redundant and inappropriately located. Life services are short in some communities so that they are unable to facilitate community residents. Some functions are missing in community commercial centers and community service networks are unevenly located.


Employees are not well trained.   As a typical labor-intensive industry, employees are not well trained with skills and capacities. They lack technical certification and are not appropriately regulated by laws. There is no feedback mechanism for services and regular technical certification, inspection and supervision have not been established.


Laws, regulations and government services lag behind.   For now, there have been no rules and regulations as well as policies for life services and investment in life services is relatively low.


Infrastructures for certain services are missing.   The amount of infrastructures is insufficient and differs across different services. Take the retail service as a positive example, infrastructures for retail services is good in terms of quantity and quality while in the suburbs, food market, supermarkets and convenient stores are inappropriately located, unable to meet people’s demands. Emerging life services are in the start-up stage and infrastructures need to be developed. The infrastructure development is slower than the growing demand of the general public on high-quality life services.