China has been an unqualified success for Walmart in one sense: Chinese factories are the backbone of its low-cost global supply chain. Yet in another sense, the world’s biggest retailer by sales has met its match in the world’s biggest country by population. Unlike its mastery of the manufacturing process, Walmart has found that the other end of its China operations – selling to consumers – is much harder.
Despite dozens of store openings every year, its share of China’s supermarket sales has slipped to about 5.5 per cent, according to estimates by the China Market Research Group. Its reputation took a bruising in October when police detained several store managers over allegations that they had mislabelled ordinary pork as organic and four senior China managers have left in the past year.
Last week, Walmart appointed Greg Foran as China chief executive. Though he has never worked in China, Mr Foran has spent 30 years in the retail industry and is seen as someone who can bring a steady hand to its operations.