BEIJING: Wal-Mart Stores Inc is focusing on food safety as the world’s largest retailer aims to boost profitability of its more than 400 stores in China, Wal-Mart Asia Chief Executive Scott Price said.
Food safety is a highly emotive issue in China where there have been numerous scandals from photos of food oil being scooped from drains to tales of phoney eggs and melamine-tainted milk powder. “We play an important role in China delivering food safety and quality products to our customers,” Price said on the sidelines of the Asia Pacific Economic Cooperation (APEC) CEO Summit. “It’s a differentiator.”
Wal-Mart came under fire in Chinese media earlier in the year after a supplier’s donkey meat product was found to contain fox meat. In 2011 Chinese authorities accused Wal-Mart of selling expired duck meat, and it was forced to shut down stores in Chongqing after they were accused of labelling non-organic pork as organic and selling it at a higher price.
Price was named on Tuesday the head of the retailer’s Asia Pacific business, in a move aimed at reviving Wal-Mart’s slowing growth amid stiff competition in the region. In Japan, the company said in October it would close 30 underperforming stores to scale back. In India, Wal-Mart last year ended a six-year partnership with Bharti Enterprises Pvt and started to run wholesale stores instead of its common retail ones.
In China, Price said Wal-Mart has experienced “a few bumps along the road”. China was the only market of Wal-Mart’s five largest ones that saw falling same-store sales in the second quarter, down 1.6 percent from the year-earlier period.
In Wal-Mart’s global markets, Wal-Mart reported for the six months ended July 31, pre-tax income outside the US down 3 percent to $11.83bn from a year-earlier, according to the company’s filings.
In October, Wal-Mart lowered its earnings forecast for this fiscal year, blaming a tough economy for the company’s low-income customers. The retailer said to expect annual sales to grow in the range of two to three percent, two percentage points down from its earlier guidance. Reuters
