“The international operations have ... been less productive and less profitable than they would like them to be, and more of a drag,” said Budd Bugatch, retail analyst at Raymond James in the United States. rpp: 100, This text may not be in its final form and may be updated or revised in the future. width: 650, background: '#002652', Walmart's decision to leave Russia came just a week after X5, of which Mikhail Fridman is a significant stakeholder and owner of Pyaterochka, Perekrestok and Karusel, secured the deal. version: 2, Speaking on December 13, 2010 the day Walmart announced its plans to exit Russia the CEO of Walmart International Doug McMillon cast the group's decision to exit the Russian market as a matter of strategy. Walmart closed its representative office in Moscow yesterday after failing to crack the Russian market. In my opinion, they've lost a few years of good growth, but I'm positive they will return. While the United States is Wal-Mart’s largest business, accounting for 59.5 percent of sales and 76.7 percent of operating income in the latest fiscal year, it is growing at a slower pace than Wal-Mart International. All rights reserved. color: '#f1f1f1', A Reuters survey showed that six out of nine analysts believe that X5, whose chain comprises mostly small low-cost stores such as Pyaterochka and Kopeika, or its hypermarket unit Karusel are the most wanted acquisition targets for Wal-Mart. "Walmart has very specific branding and image. But a year later the company had changed its requirements. MOSCOW (Reuters) - Retailer Wal-Mart Stores Inc WMT.N has let caution thwart its ambitions in Russia, and will find profits harder to come by if it delays getting a foothold in the vast market catering to 140 million people. new TWTR.Widget({ “Now there is more risk, but more return,” said Alexei Krivoshapko, director at Prosperity Capital Management, one of the biggest investors in Russian stocks with $4 billion under management. It sold its underperforming German stores in 2006 after struggling to capture market share in the cut-throat German market, where it acknowledged that it misunderstood German regulations, shopping habits and tastes. It has missed out on the 30 percent-plus sales growth currently enjoyed by Russian retailers - now likely to slow as companies start to realise that further growth will depend on expansion into Russia’s less wealthy provinces. shell: { The low-cost U.S. giant has been expanding internationally since the early 1990s to counter a slowdown in its saturated home market, and Russia has long been a target alongside China, India and Brazil. "Land here is very expensive, and maybe they counted on it getting significantly cheaper during the crisis. Walmart started looking at development too late. The CEO did not rule out further attempts to enter the Russian market in the future, however. But why did the world's largest retailer struggle to make an impact in Russia, and have grocers looking to enter the Russian market today already missed the boat? A Carrefour statement released to coincide with the pull-out reads similar to Walmart's complaints: "Carrefour has decided to sell its activities in Russia and pull out of the market, given the absence of sufficient organic-growth prospects and acquisition opportunities in the short-and medium-term that would have allowed Carrefour to attain a position of leadership," the statement read.
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