Greg Foran takes the helm at Walmart China

A 30-year retail veteran in New Zealand and Australia, Foran (pictured) joined Walmart International as its senior vice president only four months ago. Prior to that, his retail career included stints at Woolworths’ Big W discount department store and its Dick Smith consumer electronics division.

“Greg is uniquely qualified to lead our growing business in China,” Scott Price, president and CEO of Walmart Asia said in a press statement.

China is an important growth market for Walmart. It only started making real progress in the last four out of 15 years in the Chinese retail market, and faces fierce competition from the likes of Carrefour, Tesco and Metro.

Walmart entered China via Shenzhen in 1996. As of February 2012, Walmart has more than 370 stores in 140 cities—making it the No. 2 foreign retailer in China. Taking the first place is RT-Mart, owned by Sun Art, a joint venture of Taiwan’s Ruentex Group and France's Groupe Auchan.

The company was subject to regulatory heat after a mislabelling scandal last October. Ordinary pork was found to be sold as organic pork, forcing the temporary closure of 13 stores in Chongqing and the resignation of then chief executive officer Ed Chan.

Wilson Chen, manager of Kantar Retail Market Insights China, said this incident only lays out Walmart's problem with decentralisation of its retail operations. Walmart's six regional offices are given authority to run independently, allowing local staff to manage suppliers and sources for products. 

"This was a strategy meant to make regional offices more flexible and responsive to local shopper needs," Chen said. "But it backfired because of the loss of control from Walmart headquarters, causing executional inefficiencies."

There is an obvious need for a better retail system, but there is no clarity on a comprehensive solution yet. Anthony Rose, vice president of corporate affairs at Walmart Asia, told Campaign the retailer would reveal a forward-looking plan next month.

Brand damage aside, Debby Cheung, managing director of Ogilvy PR China, points out that Walmart's low-price brand promise is a poor differentiating strategy in China, where many small stores and neighbourhood vendors can offer cheaper products.

In Walmart's statement, Price emphasised "efforts to help Chinese customers save money so that they can live better". In an already hard retail environment where competing on price points is not viable, Cheung believes that "everyday a delight" might be an alternative slogan for Walmart, to differentiate itself on the "living better” part of its promise.