Wal-Mart makes progress in Japan, but losses mount

Wal-Mart may be exiting Germany and South Korea, but in Japan it has cause to throw a party. Well, maybe. Wal-Mart's Japanese subsidiary showed losses that grew five-fold from the year-ago period, although the unit's chief executive vowed that Wal-Mart is committed to the Japanese market even in the face of Wal-Mart leaving the Germany and South Korean markets.

Wal-Mart Japan's 2006 first half sales fell 2.9% to come in at $4 billion, which resulted in a $465 million loss for the January to July time frame. The larger-than-expected loss was primarily due to large one-time write-offs, rather than lackluster store sales, although the aggressive schedule included Seiyu -- the Wal-Mart subsidiary -- closing underperforming stores and remodeling existing stores to perform better.

Wal-Mart, based in Bentonville, Arkansas, now owns 53% of Japanese-based Seiyu after entering the Japanese market in 2002 by buying a stake in Seiyu at that time. With Japan being the world's second-largest retail market, Wal-Mart seems to have made significant investments in that country, including the introduction of its computerized logistics and merchandising systems along with large-scale supermarkets, which were rare in Japan before the Seiyu stake was taken out.

Brian White has worked in various executive positions in technology and telecommunications and now focuses on editing and writing.