Wal-Mart’s Moving…

...back to Hong Kong!  The new headquarters “will have strategic responsibilities for managing the company’s current operations in Asia and for business development,” said President and CEO for Wal-Mart Asia Vicente Trius.  Additionally, “the new Wal-Mart office in Hong Kong will oversee the company’s operations in the Chinese mainland, India and Japan, as well as identify new business opportunities for the company throughout Asia.” But what Trius doesn’t address is why Wal-Mart’s Asia headquarters is moving.

It was a only a few years ago that Wal-Mart traded Shenzhen for Hong Kong.  From March 2005:

Wal-Mart, the world’s largest retailer, plans to move its Asian headquarters from Hong Kong to Shenzhen in southern China next August, state media reported. Construction of the new headquarters building has begun, according to Shenzhen International Investment Commercial Property Co, US-based Wal-Mart’s partner in China. 

So why, just over three years later, would Wal-Mart move back to Hong Kong?

According to Wal-Mart Asia’s Vice President Brian Walker “Wal-Mart is able to recruit the right local staff for its regional headquarters with the [Hong Kong]’s abundant pool of talent and professionals, together with its excellent transportation, communications and technology infrastructure.” So why leave HK in the first place?  And, ouch - what is Walker implying about Shenzhen’s local talent?

However, for Hong Kong residents, there’s no need to worry:  “Despite choosing Hong Kong as the regional base ahead of Singapore and Shanghai, Trius said Wal-Mart had no immediate plans to open a store in the southern Chinese city. ‘I would say the availability of properties is a challenge here. We are not talking about prices,’ he said.”

Posted by Research Team on Wednesday, September 03, 2008

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