Sean Clarke named as head of Wal-Mart's China operations

Wal-Mart Stores Inc said on Friday it had appointed Sean Clarke as CEO Wal-Mart China. He is currently chief operating officer in the country.

Clarke's predecessor Greg Foran will head Wal-Mart's Asia unit. The changes come as the world's largest retailer changes its China strategy toward quality from rapid expansion and quantity.

Its strategy in the country brought annual sales growth of 24.5 percent last year and a place among the country's top-three retailers, according to an industry report. Wal-Mart increased its store units 3 percent in China last year. It plans to open 110 new facilities in the next three years even as it is closing unprofitable outlets.

The closures represent up to 9 percent of Wal-Mart's total store portfolio and 2 to 3 percent of total sales volume through next year. Wal-Mart will continue seeking steady growth and quality development in China, it said.

Wal-Mart to shut down its outlet in Hangzhou

Foran joined the retailer as its head of China operations in October 2012. His career began in New Zealand and Australia.

Wal-Mart said of Foran: He "created the strategic framework for change and the strategy to strengthen our business. He focused on issues that were important to customers, addressed the profitability of the business and long-term growth."

Research from Kantar World-panel China this month showed that Wal-Mart has narrowed the gap with rival hypermarket operator Sun Art Retail Group Ltd.

"Greg (Foran) was successful in his role and he has been focusing on driving more quality store growth instead of opening more new stores in China since he came on board," Jason Yu, general manager of Kantar World-panel China, said.

Ben Cavender, senior analyst of China Market Research Group, said Wal-Mart's focus on remaining profitable by closing down loss-making stores and developing the rest will help it sustain its position in China's retail market that is getting tougher due to rising costs, including those for labor.

He noted the US retailer's progress in procurement and sourcing, as well as its introduction of various formats including the Sam's Club for high-end consumers and its Yihaodian website for online buyers in China, which have contributed to the better performance. The retailer opened two Sam's Clubs in Hangzhou and Suzhou, bringing the total number in China to 10 and expects to open more in the next three years.

Yihaodian.com posted a 77 percent increase in sales in 2013. The number of registered users almost doubled to 57 million by the end of 2013.