Wal-Mart’s (WMT) glory days in the US are gone, but many figure that the big-box retailer will experience a second adolescence in China, selling goods to a burgeoning middle class.
Yeah, good luck with that. Der Spiegel notes on upstart retailer from France that’s stealing Wal-Mart’s momentum.
Over the past decade, Auchan (pronounced oh-shon) has expanded rapidly into China, Russia, and Eastern Europe. Based near the northern French city of Lille, the privately held company is now the world’s 14th-biggest retailer, with 1,200 stores in 12 countries and annual sales of $59 billion.
True, that’s small change compared with Wal-Mart’s annual sales of $405 billion. But by many measures, Auchan is outperforming its bigger rivals in key global markets. In China, it is opening an average of two new stores per month, luring middle-class shoppers away from Wal-Mart and Carrefour by providing wider aisles, better lighting, and a higher-quality product range, says Shaun Rein, managing director of the China Market Research Group in Shanghai.
Auchan now has 132 big-box hypermarkets in China, including 110 operating under the brand name RT Mart in a joint venture with a Taiwanese partner. That puts it neck-and-neck with Carrefour, but behind Wal-Mart, which has 146 stores and owns a stake in a joint venture that has another 104 outlets.