The possibility is still there for Wal-Mart to enter Colombia, through the purchase of Carrefour hypermarkets in Colombia. There is even the possibility for the business to close later this year. This was announced by Alberto Jaimes Trujillo, Mexican consultant who advices suppliers of the world's largest chain in the country.
The executive explained that the negotiation of the American company with the French company Carrefour, is ongoing and that the reason why closing the deal has been difficult has to do with what is considered the crown jewel for Carrefour:
Colombia.
Jaimes said, citing contacts inside the U.S. trading firm for which he worked as a purchasing manager in Mexico, that the appeal of Carrefour in Latin America is in Colombian stores the company has, because those are the most profitable, so it is not very interested in letting them go.
However, Wal-Mart would be interested in a deal with the French company if the country is included, next to Argentina and Brazil.
It is estimated that Wal-Mart, which annually sells about USD 450,000 million, has 13 percent of its turnover in Latin America, including Mexico, Brazil, Argentina and Central America. The consultant made a presentation yesterday to Congress attendees of Fenalco in Armenia, on the trade scenario in the case of Wal-Mart entering the country.
His position contrasts with reports that emerged months ago in the sense that these negotiations were suspended. Other analysts have talked about that to a lesser extent about Wal-Mart being interested in entering the Asian markets
and wouldl delay their arrival to Colombia.
For the expert, it is critical that merchants who already have operations in Colombia are prepared and not surprised. "There mustn`t be fear of Wal-Mart`s entry nor premeditated thoughts about it. We must hope that this business model contributes Colombian consumers so they can have access to better products and prices."
Lets check costs
The consultant explained to traders that were gather at the annual Fenalco Congress, that Wal-Mart`s strategy is not to give discounts and timely offers, but its promise and its distinctiveness in the market is to offer permanently low prices.
The recommendation is to work on a thorough review of its operational costs because that is Wal-Mart`s strength and what allows that company to have margins.
Source: Constanza Gómez G.