Article: Walmart deal gets more attention than expected

Mach III said:
Can't wait! :)
Click to expand...

It's going to be interesting, but I'm not sure it's going to help drop prices much, especially not in the short term. Walmart may be expecting to enjoy the current price-fixing based margins for a while rather than compete, plus they are first going to have to learn some lessons about operating in Africa and dealing with our unions and our labor etc., and price that into their business model (though given they're buying into an existing setup, this will be mitigated). The fact that other retailers seem to be crapping themselves is a very good sign, but I'm not holding my breath yet. In the long run it will be good for South Africa, but it may take a while to see the benefits. What it could help do is at least help keep a cap on inflation and price fixing from the other retailers. The ideal scenario will be if Walmart come in guns ablazing and price themselves aggressively, but the market conditions tell me the odds are perhaps 20% of that happening.

Note that they don't plan to put up Walmart stores either for now, they're going to keep operating under the current names, i.e. Game, Makro etc. So customers aren't going to see any major bomb drop here. At best they might slowly notice slightly better pricing from those stores, if at all, or slightly more interesting and varied offerings to compete more with the likes of Spar etc. (e.g. more groceries / foodstuffs). We may also see more of their brand stores opening more quickly as they look to expand.
 
I don't really care about the prices in the short term... I am looking forward to seeing more selection and new products on the shelves. :)
 
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