Wal-Mart Fined In China For Deceptive Price Practices To Mask Inflation
First, Wal Mart's primary gimmick for masking inflation was confined to using smaller packages sold at the same price. Now, it has devolved to outright fraud and misrepresentation. Top global discount stores Wal-Mart and Carrefour have both been fined in China for "misleading pricing at some of their stores in the nation, as the government works to rein in rising prices for consumer goods." Presumably outright lies (and being caught) are the last bastion before even such ultra low price point retailers are finally forced to hike their prices. Bloomberg explains further: "Authorities in cities including Shanghai, Chongqing, and Kunming discovered incidents at local Wal-Mart and Carrefour outlets that included labeling on products with prices that didn’t match what shoppers were charged at payment, exaggeration of discounts and labeling that led to confusion about how much a product cost. The stores may be fined five times the revenue they earned using such methods, the National Development and Reform Commission said today on its website." Our only advice on this news: get a channel checker for rice prices in China...
More from Bloomberg:
China, home to 150 million people living on less than $1 a day, has cracked down on price manipulation, ordered authorities to ensure the supply of foodstuffs and frozen contract coal prices to curb inflation that gained the fastest in more than two years in November before moderating last month. The NDRC in November fined units of PetroChina Co. and China Petroleum & Chemical Corp. for selling diesel above state-set prices.
Jiang Wei, a Beijing-based media relations official for Wal-Mart, said she couldn’t immediately comment on the fine. Carrefour China spokesman Chen Bo didn’t answer calls to his mobile phone.
And speaking of preserving margins, not to mention PP&E, we have yet to hear how Carrefour's Egyptian and Tunisian stores are faring these days.
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