Wal-Mart ramps up Chinese expansion
Overseas retailers planning new stores as rules change
Wal-Mart is to open at least ten more hypermarkets in China next year as western retailers jockey for position in the world’s biggest consumer market.
Wal-Mart will use concessions made by the Chinese government, as a condition of the country’s admission into the World Trade Organisation, to open stores into smaller cities. Overseas retailers will no longer have to form joint ventures with Chinese companies in order to invest in the region.
The world’s bigest retailer will have 43 stores in China by the end of the year, fewer than number two Carrefour, which entered the market earlier.
Joe Hatfield, president and CEO of Wal-Mart Asia, said at a Beijing news conference: “Wal-Mart evolved by starting in smaller cities and moving into the larger cities. China’s been a little bit of the reverse of that. We visited many provincial cities over the last three to four months in preparation for approval from Beijing.”
Lee Scott, Wal-Mart chief executive, said the company would continue its links with local partners. He said: “We do not see ourselves, and have no immediate plans, to move away from a partnership structure.”
Tesco has 15 stores in China through a joint venture launched this year, and is this week spotlighting its Asian growth plans with an analysts’ trip to the region which includes a tour of the Chinese operation.
Metro of Germany has also announced plans for ten more stores in Germany, taking its total to 23, saying it expects its Chinese operation to break even this year.
