In the five years through 2013, the baby product retailing revenue has been increasing strongly at an annualised rate of 15.5 per cent to an estimated $52.6 billion in 2013, says IBISWorld.

The baby product retailers in China sell a wide range of products for babies from birth to three years old. Baby food and nutrition, clothing, toys, and healthcare products and other daily-use products are included in the sector.

China’s family-planning policy makes the only child of the family more precious, which encourages parents to spend as much as they can on baby rearing. China’s growing economy has also stimulated demand for baby products.

Higher living standards have created a stable foundation for medium and high-end baby products, while faster-paced lifestyles have stimulated demand for products that offer convenience, says IBISWorld.

The top three retailers in the industry – Alibaba, Suning, and Goodbaby – accounted for 15.3 per cent of industry revenue in 2013.

IBISWorld expects the industry concentration level to increase gradually as well-established enterprises set up more sales outlets and expand their distribution networks.

Also, the rising penetration level of e-commerce will grow the market share of online baby retailers such as Tmall and Redbaby. Lastly, as competition grows within the baby product retail industry, small or scattered retailers will merge with or be acquired by larger retailers.