Wal-Mart's International Push Continues with Mexico

Wal-Mart de Mexico SAB, (WMMVF.PK) Mexico's largest retailer and a division of the US Wal-Mart (WMT), said Tuesday it plans to open 205 new stores and restaurants this year, a 12.6% increase.

The plans include developing the "Mi Bodega Express" format, chief executive Eduardo Solorzano said. The format will be more of a neighborhood store than a convenience market and said the results of two such existing stores have been encouraging.

The 2008 expansion plan also includes 17 Wal-Mart Supercenters, 79 Bodega Aurrera stores and 30 VIPs restaurants. Currently Walmex has 1,023 stores and restaurants. Results in Mexico have been good, with the stock of Walmex up 40% the past two years and earnings have grown 32% over that same time period.

This is where Wal-Mart needs to be using its capital, internationally. International sales are growing 20% annually and unlike the US, both the room to expand and customers' hunger for the product is vast...

Disclosure: Long Wal-Mart.

Comments

[deaverb:]

Absolutely correct! Wal-Mart should let the US grow organicly (to use that fancy word), stop "fighting" folks here, and take a low profile (right now one of Target's key assets is it is "not Wal-Mart"). That would let the "good" about Wal-Mart come to the surface--great prices, great jobs in lots of areas without many, and a generally OK place to shop. Learn from McDonalds--do your growth elsewhere where people really "want" a Wal-Mart. Good article. Disclosure: Sold my stock in Wal-Mart when Lee Scott announced he was going to go "up" in price and compete with Target (people want Wal-Mart to be Wal-Mart, not a second Target). Sell Target not Wal-Mart.

2008 Feb 18 08:45 AM