This year Wal-Mart Mexico invests a record amount of US$1bn in expanding into Mexico’s top cities (Mexico City, Guadalajara, Monterrey and Puebla) and in 30 smaller cities where it has no presence yet. In an interview with Reuters yesterday, Walmex’ chief executive Eduardo Solorzano said he heard about the excitement the move into smaller cities and towns is causing. “Internally we don’t see it as so critical”, he said. “For us it’s not so ‘wow!’”
Solorzano is confident about Mexico’s economic outlook and he bases his optimism on stable inflation, rising salaries, a boom in credit and a population bubble of young Mexicans entering the economy. Despite the ‘enormous growth opportunities’ he sees in Mexico’s largest cities, Walmex has been targetting smaller cities of some 15,000 to 20,000 inhabitants since last year, Reuters reported. The first 30 of these smaller cities are part of a larger group of about 370 small Mexican cities and towns, including some without major grocery store outlets which therefore depend on informal distribution channels. To Solorzano such virgin retail markets are not really ‘wow!’ but “…a great opportunity because often no formal option exists.”