In order to extend the regulatory function of the market, the state has gradually reduced the categories of products for planned production, eliminated the restriction that enterprises were only allowed to engage in production but not in business operation, and abolished the practice of the state fixing commodity prices. As a result, the rights of enterprises to purchase, produce and sell have been extended. Enterprises may organize and establish wholesale markets and trading centers; the wholesale and retail commercial systems are being restructured; and the non-public economy is allowed to take part in commercial activities.  

Through the reform, the unitary pattern in which the public economy monopolized commercial activities has been broken up step by step, and the commodity market pattern of diversified economic elements and operation forms with the public ownership of commerce as the main body has been established. Before 1978, there were 791 products belonging to means of production allocated according to state plans, but now only five of them remain, and the rest have entered the market. Now, department stores, supermarkets and chain stores are scattered everywhere in both rural and urban areas. In 1999, China had 1.800 China stores, over 2.000 various flea markets, over 1.000 leasing enterprises, and over 1.000 auction enterprises. Meanwhile electronic commercial business has developed rapidly; the agent system has been widely adopted by various trades; great progress has been made in the circulation and delivery of commodities, and modern material circulation enterprises have replaced traditional storage and transport enterprises. A great variety of food, clothing and other commodities satisfies the needs of consumers. The total market sales grow with each passing year. In 1999, the rural market achieved 1,204.3 billion yuan-worth of sales of consumer goods, 11.4 times the figure in 1978; the urban market achieved 1,909.2 billion yuan-worth of sales of consumer goods, 37.8 times the figure in 1978. At the same time a buyer’s market has appeared in the commodities sector in which the supply and demand of most commodities are kept in balance, the supply of some goods exceeds the demand, price trends are steady, and the guiding function of the market for producers has been strengthened.