Wal-Mart Stores is to close its northern regional office in China and cull 250 staff in a restructure.
The company says the changes are aimed at decreasing overheads and arrest declining sales in the country.
Last month, the company cut 25 middle management positions – it is not clear if those are included in the 250 job cuts announced this week.
Under the renewed leadership of Scott Price, president of the China operations, Walmart will close the Dalian office, consolidating its management structure in Shenzhen.
In a statement Wal-Mart said the 250 jobs include mid- and lower-level employees working in areas like corporate affairs and “asset protection”, accountis for just 0.2 per cent of the company’s Chinese workforce.
Wal-Mart has 400 stores in China and will open nine more before the year ends, along with a new distribution centre. It still plans 480 by the end of 2016.
The company has also its first shopping centre under construction in China, in the city of Zhuhai, across the border from Macau. Worth about US$98 million it is the first of up to five planned.
In the last quarter, Wal-Mart sales in China slipped 0.8 per cent. It faces tough competition as an outside player in the local grocery and discount department store sector. Chinese retail spending growth is also slowing due to a clampdown on corporate gift-giving, which is impacting on gift card sales for all retailers with gift card programs.
While a 480-strong store network may seem big, Wal-Mart is a minnow in Chinese terms. Second placed China Resources Enterprises has more than 4000 stores trading under 10 brands.
