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Six days after United States giant retailer Walmart completed its acquisition of a controlling stake in Massmart, it started advertising price cuts and new business opportunities for South Africa.
An eight page colour advertisement in the Sunday Times newspaper was South Africa's first introduction to the Walmart brand.
The advertisement included a letter from “the people” of Massmart and Walmart announcing the merger and price cuts by the group's retailers Game, Dion Wired, Makro and Builders' Warehouse.
Massmart also said it intended creating 15,000 jobs in the next five years.
“While there are other exciting promotional campaigns planned, this offering so soon after the finalisation of the Walmart merger is a clear demonstration of Massmart and Walmart's intent to save people money to live better,” Massmart CEO Grant Pattison said in a statement on Sunday.
Earlier, he told the Business Times there were no plans to open Walmart-branded shops as the local brands had “plenty of value”, and there were plans to open 40 more of them in the next financial year.
However, these brands would be advertised under Walmart's blue and yellow logo.
Walmart completed a R16.5 billion conditional transaction to buy a 51 percent stake in Massmart on Monday, after getting the go-ahead from the Competition Tribunal.
The merger was conditional on the setting up of a R100 million supplier development fund, no merger-related retrenchments for two years, and recognition of the SA Commercial Catering and Allied Workers' Union for three years post the merger.
In the statement on Sunday, Pattison said the supplier fund was being created.
Walmart has 55 brands around the world in, among other countries, Canada, Brazil, China, Chile, Japan and Mexico.
Its share of Massmart would be a stake in emerging African markets.
Before the deal was concluded, the South African government and unions voiced concerns that it would lead to job losses and hurt local procurement.
However, the Competition Tribunal found that the conditions to counteract this, which were proposed by Walmart and Massmart, were sufficient and were enforceable.
“Both Massmart and Walmart remain committed to partnering with the South African government as well as all key stakeholders, and we stand by our stated commitment to encourage other international companies to invest in Africa's vibrant economy,” Walmart CEO Doug McMillon said in the statement. - Sapa
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Jannie, wrote
There you go...Correct! most goods other than Groceries are from China. China supplies the whole world in General Merchandise.They don't deal through agents and "Nog Schleppers" they deal direct with reputable manufacturers and will pass the saving on to the consumer. The food players are in for a BIG surprise.Trust me...they are sooo good at it.Maybe not wipe them out but will certainly keep the basic food prices in check!!! and reduce the market share of a few of the existing BIG GUNS!!!With a labour force of 1,200 Million people..China rules..Trust me!
Anonymous, wrote
go walmart go walmart... sick of all the price fixing in this country. I've seen it first hand how the retailers of this country were in bed together with the price fixing...they all stuck together and robbed us ALL!! Now I will sit back and enjoy walmart wipe them out! Our retailer bosses lost touch with reality years ago, that's how much money they take home each month. Walmart has strict policies re the salaries of management. you'll see!!!
Anonymous, wrote
Most goods in hyper and super stores are Chinese anyway. Whats the difference? Look at the stuff at flee markets as well. Whose bluffing who?
Consumer, wrote
The SA market won't grow to accomodate WalMart. This new player is going to cut a chunk out of the hearts of the other retailers. About time, too.
Anonymous, wrote
100 Million Supplier Fund is less .001% of Wal Mart revenue. Where are the SA supplier contracts that will prevent job losses far in excess of 15,000?
jannie venter, wrote
Great move. There is only one winner here and that is the CONSUMER. Competition is great!
Anonymous, wrote
Walmart in North America is a fantastic place to shop. Absolutely lowest prices, many 100% organic cotton clothing, stock everything from soup to nuts, fantastic customer service, great Walmart is now in South Africa. Happy shopping!
bite me, wrote
while you've been concentrating on the so called 'bribe called BEE', all south african stores have been enjoying PRICE FIXING for years now. And screwing the people of south africa out of their hard earned money. I hope Wallmart kicks ass........
Anonymous, wrote
These massive companies, sell their goods cheaply at first, they get the competition closed down and then they screw everybody, be aware, be very AWARE.All the goods sold in these MASSIVE stores are sourced in China, so we now have more unemployment. Sad day indeed for local business.
Sinies, wrote
Anonymous, wrote
...and they pressured local manufacturers already to non-viable prices at their volumes, leading to even more joblessness. What a happy ANC ending! Who took the bribe called BEE, so that the poor can suffer even more at their master.
Anonymous, wrote
dave, wrote
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