Operational changes to Walmart’s Chinese division have been signalled as it seeks to become the dominant player in what is now the world’s largest retail market.
The US-based retailer has faced many setbacks since entering China 15 years ago and its head of international operations, Doug McMillon, last week told analysts the company had failed to achieve the level of success he believed it capable of.
Chief executive of Walmart’s Asia division, Scott Price, told the Wall Street Journal that recently appointed top-level management in the region would push to increase the company’s emphasis in online retail and work to contain costs.
Walmart is awaiting regulatory approval to purchase a controlling share in established Chinese online retailer, Yihaodian.
Greg Foran, who was appointed Walmart China’s chief executive earlier this year, would focus on increasing its product offer while maintaining consistently lower prices, said Price. This represented a shift away from the current strategy of hosting temporary discounts and seasonal sales, the newspaper reported.
Foran was also expected to oversee expansion of the number of outlets in China, which currently sits at 379, although Price would not be drawn on the actual number of planned stores.
According to consulting firm China Market Research, Walmart’s profit margins in the country were between 2-3 per cent, meaning the company must develop scale for it to remain viable there.
No comments yet