US retail giant Walmart says it wants to become the price leader of the retail industry in China.
Greg Foran, president and CEO of Walmart China, who recently visited Walmart Qinghe store in Beijing, said during the past 18 months, Walmart has made great strides in reducing merchandising and operation costs, selecting suppliers on a nationwide and even worldwide scale, centralising merchandise, reducing product prices, and offering “special worry-free” products which guarantee competitive prices for more than six months.
By delivering more products to stores through Walmart’s seven distribution centers and seven fresh distribution centers, Walmart is able to improve efficiency, guarantee quality and control prices. Walmart also applied its world-class inventory management system, which effectively controls costs and results in further reduced prices, said the CEO.
Foran believes that as Chinese customer demand for imported goods increases, Walmart will continue to add imported products to its shelves. By leveraging its global sourcing system, Walmart is able to introduce quality imported products at relatively low prices.
Foran said Qinghe, which is located outside Beijing’s fifth ring road, is a good example of new commercial centers and business areas in Beijing. He said the area is showing great promise for purchasing power and emerging market demand.
Although the disposable income of Chinese customers continues to increase, customers are still most concerned about food safety and authenticity, price and availability.
Foran emphasised that this price is not a short-term sales promotion, but a worry-free price that will last for more than six months. He said Walmart can provide products at such low prices due to the consolidation of merchandising resources.
