The newly established duty-free store is operated by the Chinese National Service Corporation (CNSC), as part of its plan to expand duty-free shops outside the country's airports.
There are three international airports in China which offer duty-free products. These are located in the departure and arrival areas of airports in Beijing Capital, Shanghai Pudong and Shanghai Hongqiao.
The new duty-free shop, a two-story structure with an area of 3,330 square meters, offers about 100 brands. The prices are said to be more expensive than in the shops in the airport.
However, consumers said that the price in the new Shanghai store is cheaper than Tmall.com and on-site stores.
"The 69 yuan Belgian chocolate is about 30 percent cheaper than that in the company's own brand name chain store. The Japanese skincare lotion is 380 yuan, 20 percent lower than that on Tmall.com," said Ma Nan, a mother of two children.
An analyst from Shanghai said that there are more Chinese who are traveling and are more familiar with international brands.
Zhang Yuanfan, an analyst with Shanghai-based Yu Song Commerce Consultancy Ltd., said," As Chinese residents are better traveled than ever, they are exposed to a wide range of products and they wish to buy immediately once they run out."
He added, "Retailers that can offer them products such as food and other goods at competitive prices are more likely to gain from this emerging opportunity."
Best sellers of the store are food and beverage goods. China's Ministry of Commerce believes that consumer spending will likely increase in these two sectors. Consumer goods increased by 14.3 percent in 2015 and created sales of 30 million yuan.
Yan Jianxin, deputy manager with the CNSC duty-free products segment, said that the Shanghai outlet wants to offer a different range of products. The store sells products such as electronic appliances, perfume, toys and liquor.