Although I touched on this subject last summer, it seems that talk has resurfaced about Wal-Mart Stores, Inc. (NYSE: WMT) probably entering the Russian market soon. That country's economy is set to expand in a unique way over the next decade, and as such, Wal-Mart would love to be there to capitalize on the growing need for retail products of all shapes and sizes.Russian could be one of Wal-Mart's greatest opportunities -- even as lucrative as the India and China markets it is currently operating in. A lack of discount retail competitors with global finesse and pricing power gives Wal-Mart a golden opportunity to enter the Russian market and become entrenched as the "go to" retailer for mush of the country's consumer retail needs. Will Wal-Mart take a second look? It's way past that, and all indications are that it will be in Russia by 2010.
Russia's status as the world's largest crude-oil and natural-gas exporter should help a rising middle class grow while Wal-Mart takes the time to study and enter the country's marketplace in the smartest fashion possible. And, from the grocery end, Russia's $145 billion food retailing industry takes in half of all consumer spending. Rising incomes may boost demand for better food products, and that is where Wal-Mart will come in. Either by itself or with a retail partnership (like in India and China), Russia should prepare for the "big box" soon.
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Reader Comments (Page 1 of 1)
3-19-2008 @ 7:35PM
Neomi said...
Russians are not dreaming about yet another 'big-box' coming to them, and definitely verbs like 'should' in conjunction with 'prepare' seem to be out-of-place in the Russian retail market. If Wal-Mart finally decides to strike the fanfare, they risk finding themselves deeply disappointed or, as it usually happens, blaming the cultural difference for the lack of sales. If Wal-Mart were a bit more agile, they should have been there 10 years ago. The Russians have a great choice today among transnational METRO, IKEA, AUCHAN, SPAR, etc., but the longest list of supermarkets is maintained by the Russians themselves. A new Russian blockbuster name pops up probably every other month or two. WM should study their German experience carefully before entering Russia. Good luck!
4-14-2008 @ 2:54PM
madmilker said...
Quote***In China, as elsewhere, we follow the Wal-Mart tradition of building our business one store and one customer at a time. We strive to provide our customers with friendly service and a wide selection of quality products at Every Day Low Prices. With each Wal-Mart store we bring advanced retail know-how to the local market. By fostering a healthy, competitive environment, we hope to constantly improve our business operations and customer service in order to contribute to the prosperity of the local economy.
Wal-Mart firmly believes in local procurement. We recognize that by purchasing quality products, we can generate more job opportunities, support local manufacturing and boost economic development. Over 95% of the merchandise in our stores in China is sourced locally. We have established partnerships with nearly 20,000 suppliers in China. At Wal-Mart, we always work with our suppliers to grow together. In August 2007, Wal-Mart once again secured the top spot of the 2007 Supplier Satisfaction Survey conducted by Business Information of Shanghai. Additionally, Wal-Mart directly exports about US$9 billion from China every year. The export volume by third party suppliers is also estimated to be over US$9 billion.***end quote
Don't think the nice people of Russia want that... the nice "smart" people of Germany and South Korea didn't.