Walmart (WMT) will tackle the rural and poorer sections of China with small stores that are easy and cheap to build. The model is based to some extent on facilities the world's largest retailer operates in Mexico.
The Financial Timesreports that the new stores will be called "compact hypermarkets." Doug McMillon, chief executive of Walmart's international business, told the Times that the return on investment in the smaller facility was the same as that of a store twice its size. "But the cost of operating it is less," he said, "so the [prices] are less."
Walmart competitor Carrefour, based in France, already has over 100 hypermarkets in the People's Republic.
It remains to be seen whether there is a large enough population in the middle-sized cities and rural areas of China with the money to shop at Walmart.
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