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Walmart slashes mid-level jobs in China amid restructuring jig

RBR Staff Writer Published 28 November 2014

Wal-Mart Stores has slashed more than 20 mid-level jobs in China, a market where it is struggling to improve sagging sales and contain costs.

Walmart

Last year itself, the retailer made a grand announcement of opening 110 facilities between 2014 and 2016 as part of its aggressive China push, while closing some outlets.

But it has been struggling to improve slumping sales; the retailer witnessed 0.8% fall in sales in the country during the quarter to Oct. 31, which it attributed to government austerity measures and deflation.

Close to 30 jobs were slashed at director, vice president and senior staff levels. Chinese media reported that the retailer was cutting over 100 jobs, including senior and mid-level executives.

Anonymous sources told Bloomberg that among the executives dismissed were vice presidents from Wal-Mart China and Sam's Club China while others were from divisions, including merchandising and innovation. Walmart, however, declined to comment.

Speaking on the cuts, Wal-Mart China spokesman Raymond Bracy said that these were a "necessary business reality", and "the company would pay appropriate settlements to the employees affected."

Wal-Mart operates more than 400 stores in China.

It was earlier embroiled in a food safety scandal in which its popular "Five Spice" donkey meat was found to contain traces of fox meat.

The retailer has recently reduced the number of its Chinese pork suppliers from several hundred to several dozen in a bid to increase the efficiency of its distribution system and tighten quality control.

The move is part of Walmart's overall Asia restructuring that includes store closures in Japan and management changes in India, reports Bloomberg.


Image: Walmart Supercentre, Canada. Photo courtsey of Walmart.