Insight: Lost in translation – Wal-Mart stumbles hard in Brazil

Brad Haynes, Nathan Layne – Reuters, 02/17/2016

When Wal-Mart Stores Inc. (WMT.N) first expanded into Brazil’s midwestern farm-belt city of Campo Grande seven years ago, the economy was booming and executives were eager to open stores even in sub-prime locations on one-way streets heading out of town.

It didn’t last. At the end of December, the U.S. retailer closed both of its Maxxi brand cash-and-carry stores in Campo Grande as part of a restructuring that shuttered 60 locations across Brazil, including some Supercenters. Shoppers said the stores could not compete on assortment, price or location.

“It was never clear who Maxxi was for. It wasn’t cheap enough for the poor. But there was no appeal for the middle class,” said Ordecy Gossler, 40, a public accountant filling his cart with cleaning supplies and toilet paper at Atacadão, a rival chain run by France’s Carrefour (CARR.PA).

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