Friday, September 22, 2006

Global retailers take stock

Reuters reports:

Global retail giants are slowing down expansion plans to take stock. Wal-Mart in the mid 1990s expanded wildly, buying the Asda chain in the UK with 229 stores, 122 stores in Canada, 95 stores in Germany and 4 in South Korea and opened its first stores in Argentina, Brazil and China. Contrast it to the past four months, and Wal-Mart has not done any expansion and instead has opted out of South Korea and Germany and is expected to do the same in Argentina.

International retailers have had a hard time understanding that opening lots of stores does not work for all international markets and now are focusing on select countries such as India, where its is lobbying for a change in the FDI restrictions; China, the world’s most populous country; and Latin America. Carrefour learnt a similar lesson and pulled out of South Korea, Mexico and Japan and is focusing on China. Tesco pulled out of Taiwan and is focusing on its US entry and on Europe.

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