by Lance Turner
Posted 10/26/2012 10:08 am
Updated 1 year ago
Still dealing with issues related to bribery allegations and bracing for scrunity regarding its increasing investment in India, Wal-Mart Stores Inc. of Bentonville turned its attention to China this week, announcing plans for new stores and intiatives to encourage suppliers to be more environmentally friendly.
First, the expansion plans. The world's largest retailer said it will add 100 new stores and Sam's Clubs in China over the next three years. According to a statement, the company also will invest in logistics infrastructure and add 18,000 jobs there to support store growth. Wal-Mart already operates 382 stores and employs 100,000 people in China.
The Wall Street Journal points out that the retailer's plan actually consistutes a slowing pace of growth in Chinese economy that's also slowing down. Wal-Mart has been adding stores at a rate of 50 to 60 per year there.
Executives said in August that the retailer would open fewer stores in China next year, halving the square footage that the company originally forecast. "To improve our site selection and store design, optimize customer shopping experiences, we made a decision earlier to moderate our growth," said Scott Price, Wal-Mart's head of Asia, in an emailed statement to The Wall Street Journal.
In an interview in September, Mr. Price said Wal-Mart isn't threatened by China's economic slowdown and that the company will still benefit greatly from the country's ballooning middle class.
Meanwhile, the retailer is pushing its suppliers in China and other parts of the world to adopt more sustainable practices. In China, Wal-Mart plans a sustainability consortium, using its "sustainability index" to "design more sustainable products, make its global supply chain more socially and environmentally accountable and responsible, and incentivize merchants to make sustainability a bigger part of their day-to-day jobs."
The new sustainability requirements, which could affect 20,000 suppliers, will
compel workshops that churn out much of the world's toys, clothing and electronics to improve on energy efficiency, waste reduction and other markers on the retailer's checklist.
Wal-Mart said the checklist was voluntary. But if suppliers fall short, they could be cut off from the nearly 4,000 Walmart discount stores and more than 600 Sam's Club wholesale warehouses that the company operates in the United States.
Wal-Mart CEO Mike Duke outlines the retailer's plans in a video after the jump.