Wal-Mart Asia President: I hope to retire in China

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Last updated at: (Beijing Time) Sunday, December 07, 2003

Wal-Mart Asia President: I hope to retire in China

"I have told the US headquarters that I hoped to stay in China till my retirement," said Joe Hatfield, president of Wal-Mart Asia, who usually arrives at his office before 5 o'clock in the morning.

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"I have told the US headquarters that I hoped to stay in China till my retirement," said Joe Hatfield, president of Wal-Mart Asia, who usually arrives at his office before 5 o'clock in the morning.

Hatfield was appointed the president and chief executive officer of Wal-Mart Asia: Wal-Mart Stores. Inc. in 1994, and spentnine years in South China's Shenzhen.

Wal-Mart entered China in 1996 and opened its first Supercenterand Sam's Club in Shenzhen, China. It has since then opened thirty-one stores in fifteen cities in China, including Wal-Mart Supercenter, Sam's Club and Wal-Mart Neighborhood Market, and has approximately 16,000 local employees.

On the walls of the office building of Wal-Mart Asia, a six-floor reconstructed workshop, there are some bulletins including tallies of how much paper people saved and recommending merchandises by staffs.

Instead of the huge capital and international reputation, he attributed Wal-Mart's success in China to his excellent 16,000 associates.

"What Wal-Mart basically believes is that people are our real assets," said Hatfield, who believed that Wal-Mart China would grow to be a locally run company.

There is only a small group of expatriates in Wal-Mart China and 99.9 percent of staff are local people. All 31 Wal-Mart storesin China are directly operated by local associates, he said.

Facing international retailer giants, many Chinese local governments and retailers expressed their worries, which often resulted in some policy restrictions on market entrance of foreignretailers.

But the difficulties did not cut down Wal-Mart's expectations of China's market.

In 1996, the former president of Wal-Mart Stores Inc. David Grass said that China was the only country with a potential to duplicate Wal-Mart's miracle in the US.

Hatfield said that when they opened the first two supercenters in Shenzhen, everybody thought it would put off other business. But today they have nine stores in Shenzhen with two more to be opened up in the next year, but other Chinese stores are continuing to grow.

What is actually occurring is that the market is growing and customers are benefiting from better shopping experiences, he said.

"If I had told the Shenzhen government what would occur here, Iam not sure most people would have believed that," said he.

From the speed point, Wal-Mart's developing speed is not as fast as that in other countries, according to Hatfield.

"We have the core beliefs and operating strategy of American stores, but it is critically important to let Chinese customers understand those," said Hatfield, who pointed out the second important issue is gaining people to handle the goal.

"We should learn crawl, walk and eventually run," stressed Hatfield.

He also pointed that one key to success of a retailer was not just to have the money to open stores, but to develop a strong vender base.

We share our sales information with our venders through retail link, our on-going sales base, and we score them and tell them theexpectations of our customers, said he.

In order to ensure the safety of its commodities, Wal-Mart often sends specialists with professional background to visit the store's venders, especially daily items.

As a toy buyer, he witnessed the changes of countries as toy providers in Asia in past decades, from Japan to the Republic of Korea to Thailand to Taiwan, and eventually to the Chinese mainland.

"The only standard is the efficiency. What we are searching foris the place where can provide great value to our customers," saidJoe.

In 2002 Wal-Mart global sales reached 244.5 billion and topped the Fortune Global 500 for two consecutive years. It has set up purchasing offices in 25 countries and holds about 150 buying meetings every year across the world.

Wal-Mart's global procurement unit was relocated in Shenzhen in2002 and set up its branch office in Shanghai in 2003.

Now Wal-Mart has over 2,000 Chinese venders which provide about15,000 kinds of commodities. About 97 percent of Wal-Mart merchandise sold in China are produced locally.

Committed to growing with China, Wal-Mart procured over 12 billion US dollars of merchandise directly and indirectly in Chinain 2002, covering six percent of the total sales of Wal-Mart, and expected to reach 15 billion US dollars in 2003.

"After retirement, I want to be a door greeter of Wal-Mart stores in Shenzhen," said Hatfield.

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