Wal-Mart Opens First Store in Beijing

Wal-Mart, the world’s biggest retailer, opened its first outlet in China’s capital Friday, making its inaugural foray into a major Chinese city after setting up 22 stores elsewhere in the country.

Thousands of shoppers packed the cavernous Sam’s Club store on the far western edge of Beijing, testing out electronics, puzzling over imported cheese and loading shopping carts full of beer, paper towels and fresh seafood.

“We’ll try it out. The prices look cheap, but it’s a little far to come,” said Li Mei, a housewife pushing her 2-year old son in a shopping cart past tanks of live seafood in the food section.

The opening represents a new step in Wal-Mart’s penetration of the Chinese retail market, seven years after it opened its first China outlet in the southern city of Shenzhen.

Wal-Mart operates about 3,200 Wal-Mart and Sam’s Club stores in the United States and more than 1,200 stores worldwide, including outlets in Germany, Great Britain, Brazil, Argentina and Korea. Wal-Mart racked up worldwide sales of $217.2 billion in 2001, but won’t say how much of that was in China.

Already the single largest buyer of Chinese products, the Bentonville, Ark.-based company is rapidly becoming one of the biggest sellers to Chinese too.

Customers snapped up meat and seafood at the Beijing store, while western breakfast cereal, cream cheese and dill pickles drew few buyers. By midday, the 1,000-spot parking lot was full – an indication both of the store’s popularity and the growing taste for cars among the city’s increasingly affluent middle-class.

If Wal-Mart were a nation, it would be China’s eighth-largest export destination.

Even many of the best known American food products on sale in the Beijing outlet are made in China. The Heinz baby food came from the southern city of Guangzhou, the Budweiser beer was brewed in Wuhan in the country’s center, and the Tang drink mix comes from Tianjin, just east of Beijing.

Wal-Mart president for Asia Joe Hatfield said the company plans two more stores in Beijing.

“I think we’ll do well,” Hatfield said as members of the 500-strong staff wearing jeans and red polo shirts rushed among the crowds, answering questions and restocking shelves.

Hatfield said the company held off opening in Beijing until it had refined its approach to the China market and trained a core group of experienced Chinese managers.

The lag, however, has allowed other companies to move into the bulk shopping sector in Beijing. France’s Carrefour and PriceSmart of the United States already have Beijing stores. Local competitors are also getting into the business too, including one called Wu Mart, located about five minutes from the Wal-Mart store.