Wal-Mart Plans Another Attempt to Win Over Japanese

Retailer trying to win over lower-income shoppers

   

Wal-Mart Plans Another Attempt to Win Over Japanese

Discount retailer Wal-Mart (NYSE:WMT) is planning a 22-store expansion into the Japanese market, The Wall Street Journal is reporting. The new stores will be added to the more than 350 current stores in Japan, one of the world’s largest consumer markets.

The Arkansas-based chain became involved in Japan 10 years ago with their purchase of a minority stake in the Seiyu chain of supermarkets. With subsequent purchases, Seiyu is now a wholly owned subsidiary of Wal-Mart. The chain operates its stores in Japan under the Seiyu name.

Corporate belief is that the increasing number of single and lower-income households in Japan is leading to a greater acceptance of Wal-Mart’s operational philosophy of lower-priced products. The Japanese market traditionally has been skeptical of lower prices, equating them with lower-quality merchandise.

Wal-Mart currently has a 2.6% market share in the Japanese retail market, vs. a 13.4% share of the American market. The chain has more than three times the revenue of chief American competition Target (NYSE:TGT) and Costco (NASDAQ:COST), according to Seeking Alpha.

The commitment to Japanese expansion goes along with Wal-Mart’s expansion in other areas. Last week, the company announced that it intended to open stores in India within two years.

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Article printed from InvestorPlace Media, http://investorplace.com/2012/09/wal-mart-plans-another-attempt-to-win-over-japanese/.

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