"In few years, foreign retailers will pose a greater threat to local ones", he said.

While Wal-Mart and other foreign rivals are busy localizing, Brilliance Group tends to optimize its management.

The 2006 annual report of Brilliance Group showed its emphasis on management system transformation, gradually pooling stocks of foreign commodities and shifting key operational tasks to improve every store's performance.

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It plans to withdraw from places where operational conditions are unsatisfactory, and intensify in strong locations, Wang confirmed.

Wal-Mart, however, will insist on its tried and tested concepts. "We will try to provide better prices, quality of goods and other services," said Paul Hu, spokesman for Wal-Mart's Shanghai office.

"Markets like Wal-Mart are larger in size and more complete in the variety of goods," said Zhou Shu, who prefers to go to stores operated by foreign companies.

Yin Jingmei, 23, who chooses to go to local supermarkets, said "it is convenient to go there and goods are cheaper than in the markets run by foreign companies".

"But foreign invested big malls have more discounts and a more complete variety of goods. Compared to local supermarkets, they have more exporting goods," she adds.