I‘m William Decker, a successful Amazon FBA seller and ecommerce expert. Lately, I‘ve been getting a lot of questions from readers about whether retail giant Walmart is actually owned by China.
It‘s an understandable question – with over 400 stores and 20 distribution centers in China, plus 70-80% of suppliers located there, it‘s easy to assume there must be Chinese ownership behind the scenes.
After digging into the facts, I can definitively say no – Walmart is not owned by China or any Chinese companies as of 2022.
In this post, I‘ll share everything I‘ve learned about who really controls Walmart, their strategy in China, and what it means for ecommerce sellers like you and me.
Walmart‘s Ownership: The Walton Family Rules
Walmart was started in 1962 by Sam Walton in Arkansas. The Walton family still owns the largest chunk of the company through two personal holding groups:
Walton Enterprises LLC: This private company controls ~50% of Walmart‘s total shares
Walton Family Holdings Trust: Maintains balance between family and non-family stakes
The only other owner with over 5% of shares is Vanguard Group, an American investment firm.
So while Walmart operates stores and buys products globally, its ownership and control firmly rests with the Waltons and American shareholders.
Below is a breakdown of Walmart‘s top shareholders as of March 2022:
|Walton Enterprises LLC||USA||~50%|
|Walton Family Holdings Trust||USA||~50% combined|
|The Vanguard Group, Inc.||USA||5.15%|
|State Street Corporation||USA||4.13%|
As you can see, the Walton family collectively controls around 50% through their personal companies, with all other shareholders under 5% ownership.
The key takeaway – Walmart is an American-owned and controlled company. But let‘s take a closer look at their China strategy next.
Inside Walmart‘s China Expansion
Walmart entered China back in 1996 and has rapidly expanded its presence through a three-pronged retail approach:
Walmart Hypermarkets: These are massive stores up to 230,000 square feet in size, selling everything from fresh food to home goods.
Sam‘s Club: Walmart‘s membership-based wholesale chain, focused on bulk purchases.
Walmart Supermarkets: Neighborhood grocery stores catering to weekly shops.
Some key facts about Walmart‘s China footprint:
400+ stores across 180 Chinese cities
95%+ merchandise sourced from local Chinese suppliers
20+ distribution centers supporting online delivery
100,000 Chinese employees
Walmart has clearly made big investments to scale locally and source from domestic suppliers. While far smaller than its US presence, China is still a major part of Walmart‘s growth strategy.
In 2016, Walmart sold its Yihaodian ecommerce platform to JD.com, taking a 5% stake in JD in return. So they seem focused on partnering with established Chinese online retailers rather than building their own.
Reliance on "Made in China" Suppliers
Here‘s where it gets interesting. Even though Walmart itself isn‘t owned by China, around 70-80% of its suppliers are based there.
Everything from clothes to toys, electronics, homeware and furniture is mass-produced in Chinese factories. And competitors like Amazon source from the same pool of suppliers.
As a result, prices and product selection for US retailers are heavily dependent on continued access to cheap Chinese manufacturing.
Here‘s an estimate of how much Walmart spends on products made in China each year:
|Home Furnishings||$10 billion|
|Apparel & Accessories||$10 billion|
And this figure doesn‘t even include grocery and household consumables, which likely add billions more.
The bottom line: Walmart‘s scale and supply chain are deeply integrated with and reliant on Chinese manufacturing. But that is very different from being outright owned by China.
Should Retailers Depend so Heavily on China?
As an ecommerce seller myself, I‘ve grappled with questions around sourcing from China. While the savings are undeniable, putting all your eggs in one basket is risky.
Some drawbacks I see to over-relying on Chinese suppliers:
- Lack of control: Quality, ethics and IP protection can be hard to guarantee
- Fragile logistics: As we‘ve seen, global supply chains are easy to disrupt
- Geopolitical tensions: Threat of tariffs or other trade barriers
However, there are also good reasons why China dominates global manufacturing:
- Huge economies of scale in production
- Specialization across industries like tech and textiles
- Investments in advanced manufacturing techniques
- Extensive shipping infrastructure built up over decades
My take is that some level of China dependence makes sense for cost-conscious retailers like Walmart. But having diverse sourcing options across southeast Asia, India, and even local US production is wise to hedge risk.
As a small ecommerce seller, I recommend always having a Plan B supplier in a different country. Even if they are more expensive, having options will protect you from unpredictable disruptions.
Can Small Ecommerce Brands Compete with Walmart?
A question I often get from ecommerce sellers is how SMBs can compete when giants like Amazon and Walmart dominate online retail.
Here are a few tips I share on how small brands can stand out:
Differentiate on brand story and mission. Connect emotionally with your target audience. Walmart is a faceless everything store.
Focus on excellent curation in your niche. Cater to enthusiasts willing to pay more for quality merch.
Provide exceptional customer service and community. Big box retailers treat customers like transactions.
Get creative with packaging and unboxing. Find ways to delight customers when they receive orders.
Engage socially and personally. Walmart is too big to forge authentic connections.
Adapt quickly to trends in your category. Giants turn slowly.
As David vs Goliath, small brands will never compete on sheer size and breadth with Walmart. But by playing to your strengths as a focused, authentic brand, you can definitely carve out a successful niche.
While Walmart operates over 400 Chinese stores and sources heavily from Chinese factories, it is not actually Chinese-owned. The Walton family maintains controlling ownership of Walmart through personal holding companies.
However, Walmart and other major retailers remain heavily dependent on Chinese manufacturing for affordable pricing and supply capacity. This leads to vulnerability from trade disruptions, intellectual property issues, and geopolitical tensions.
As an ecommerce seller myself, I believe some China exposure makes sense but recommend always having backup suppliers in other regions. This provides stability if supply chains from China are impacted.
Small ecommerce brands can absolutely compete with retail giants like Walmart by differentiating on mission, curation, branding, customer service, and community engagement. As David battling Goliath, play to your strengths rather than trying to match the scale of big box retailers.
I hope this post has cleared up the facts around Walmart‘s ownership and China reliance. Please let me know if you have any other questions!