Wal-Mart struggling overseas

Wal-Mart's Japanese division, Seiyu, announced that it lost Y17.8 billion in 2005, against a Y12.3b loss in 2004; this is its fifth consecutive annual loss. To make things worse, they said they expect a Y54.4b loss this year, "because of a change in Japanese accounting laws that require it to lower the estimated value of its stores." Sales were down 3.3% in 2005.

Wal-Mart owns a little more than half the company. Successful as they are in the US (and in Canada and Mexico), Wal-Mart has done poorly in several countries. Asda is getting pummeled by Tesco in the UK, Wal-Mart has had little success in Germany, and Chinese marketers I've spoken with show little regard for Wal-Mart's prowess.

Update Wednesday, 2/22: Asda reported poor results for the fourth quarter:

"In the U.K., Asda's comp[arable] store sales were slightly negative for the quarter end-year, and this resulted in sales and profits being below plan for the quarter and year," Holley said in the company's prerecorded fourth quarter earnings conference call.

Another update, Wednesday night 2/22: Financial Times is reporting that Wal-Mart is closing stores in Germany:

According to a report in Financial Times Deutschland Wal-Mart's German unit will close an additional three stores and drop its presence in the country to its lowest level since it entered the German retail market in 1997/98. Wal-Mart Germany plans to close stores in Sigmaringen, Dusseldorf-Reisholz, and Muehldorf with the newest closures dropping the total number of stores to 85.