Wal-Mart Upgrades Compliance in China

The retailer is responding to a television report criticizing its compliance systems and requirements for vendors.

BEIJING — Global retail giant Wal-Mart Stores Inc. is upgrading its compliance systems and requirements for vendors in China, the company said Wednesday.


In a follow-up statement to its initial response about a critical report on state-run television last week, Wal-Mart said it intends to make better use of existing systems and implement new programs to help vendors through the product compliance process.


China Central Television (CCTV) reported last week that it had found problems in portions of Wal-Mart’s supply chain and that vendors were able to cut corners in order to get hundreds of products to Wal-Mart shelves in China.


The television report came weeks after Wal-Mart was forced to recall packages of donkey meat from stores in Shandong province when government health officials said they found the packages labeled “donkey meat” contained fox meat.


Wal-Mart has denied any wrongdoing. The company said in its initial response Friday that it did not push products through too quickly, but in many cases went above and beyond China’s safety and health standards. It said the CCTV report focused on a narrow system by which the retailer fast-tracks approvals for some products from already known and established vendors.


China’s food and product safety is a touchy topic for its many millions of consumers and in its follow-up statement, Wal-Mart said it was taking action to address any problems. Namely, the company will deploy computer systems to ensure that all products on the shelves of its 400-plus stores in China are tested, approved and safe.


“Wal-Mart has been increasing its vendor compliance procedures over the last two years and will now add further steps to ensure the correct documents and other required items are in place before the products are sold in our stores,” the company stated.


It listed eight measures, including ensuring accurate labels, substantiating claims like “world famous,” and requiring paperwork like intellectual property rights statements and all proper government certifications.


“Wal-Mart China has now invested in a computer-based system enabling vendors to upload all required legal documents.”