Walmart Inc., a significant player in American retail, placed a wager on Africa in 2011 by acquiring the majority of the South African retailer Massmart, which many investors interpreted as a move toward dominating the continent’s enormous untapped market.
The strategy didn’t work out as expected.
More than ten years later, Massmart’s financial sheet is weighed down by debt, its books are stuffed with losses, and it is buried with commercial property leasing commitments.
Walmart has made a number of mistakes in Africa over the past ten years, including a tardy introduction into e-commerce and a disastrous excursion into fresh goods. These mistakes have been made worse by economic challenges and the COVID-19 pandemic.
But Walmart is doubling down with a plan to fully control its African problem child, which it disclosed in August, rather than retreating as it has done in response to failures in Britain and Germany.
According to nine analysts, investors, and sources with direct knowledge of Walmart’s plans, the aim is to first strengthen Massmart so that it can defeat its physical rivals before defeating Amazon in a looming conflict over the future of African e-commerce.
