An employee pushes carts at a Walmart supercenter in Beijing, China. The company has just picked a new head of its China operations.
An employee pushes carts at a Walmart supercenter in Beijing, China. The company has just picked a new head of its China operations. - 

David Brancaccio: The retail giant Wal-Mart has named a new head of its China operations. Greg Foran used to run Woolworths in Australia.

As Marketplace's China Bureau Chief Rob Schmitz reports, he'll need to work on an interesting challenge: the sense that Walmart in China is a fancy place to shop.


Rob Schmitz: It’s been a tough year for Wal-Mart in China. Last Autumn, it had to close thirteen stores due to a food labeling scandal. Since then, it’s been shedding market share to up-and-coming Chinese retailers.

Shaun Rein: If Wal-Mart’s going to win in China, they really have to change their DNA.

Shaun Rein, author of “The End of Cheap China,” says Wal-Mart transplanted what worked in the U.S. into the China market. Bad strategy, says Rein -- in China, there’s always someone who will beat you on price.

Rein: Over the last five years, they’ve misunderstood who their main purchasers are. Their main core purchasers are coming to Walmart for a premium shopping destination.

Wait. Did he just call Walmart a "premium shopping destination"?

Rein: Yeah, in China, Walmart is considered a premium destination.

Shoppers in China like Walmart’s imported food made under strict health standards. Having a deep understanding of what Chinese consumers want will be crucial for its new China CEO, says Rein. But he says that might be tricky -- Greg Foran, Wal-Mart’s new head of China operations, has no previous China experience.

In Shanghai, I’m Rob Schmitz, for Marketplace.

“I think the best compliment I can give is not to say how much your programs have taught me (a ton), but how much Marketplace has motivated me to go out and teach myself.” – Michael in Arlington, VA

As a nonprofit news organization, what matters to us is the same thing that matters to you: being a source for trustworthy, independent news that makes people smarter about business and the economy. So if Marketplace has helped you understand the economy better, make more informed financial decisions or just encouraged you to think differently, we’re asking you to give a little something back.

Become a Marketplace Investor today – in whatever amount is right for you – and keep public service journalism strong. We’re grateful for your support.

Follow Rob Schmitz at @rob_schmitz