SUNDOG - 10-28-2006 at 12:40 PM
Tijuana Wal-Mart provides alternative to crossing border
By Anna Cearley
UNION-TRIBUNE STAFF WRITER
October 28, 2006
TIJUANA – The opening of a Wal-Mart Supercenter in this border city is facing the critical eye of some seasoned cross-border shoppers looking for
bargains.
NADIA BOROWSKI SCOTT / Union-Tribune
Joaquin Olaya and his wife, Maria, who held 2-month-old Alexis, shopped in the toy department of the new Wal-Mart in Tijuana. He said he did not think
the store that opened yesterday would present a threat to local businesses.
On the store's first day of business yesterday, Rosario Mojica, 39, and her brother, Samuel Mojica, 26, inspected a toaster oven that cost about $54.
The siblings, who had come to do some cost comparisons, said they saw the same one in the United States for $10 less.
They passed on the toaster, but other members of their group were stocking up on supplies that they said were priced more comparably to items in the
Tijuana area: soap, tortillas, cleaning supplies, beans and hair gel.
The peculiar realities of the border have instilled certain habits in shoppers such as the Mojicas, who use their cross-border visas to regularly buy
food and appliances in the United States and who believe that stores north of the border offer higher-quality products at better prices.
Those dynamics have often posed challenges to Tijuana-based businesses, who have had to capitalize on other benefits, such as location, to woo the
local market. Warehouse-size stores such as Home Depot, Sam's Club and Costco have nonetheless managed to find niches in Tijuana.
Smaller businesses, meanwhile, have learned to adapt to competition from abroad, as well as in their own backyards. The Tijuana Supercenter generated
no notable outcry here, as has been the case in some U.S. and Mexican cities.
NADIA BOROWSKI SCOTT / Union-Tribune
Rosario Mojica (left) and her brother, Samuel Mojica, compared toaster oven prices at the new Wal-Mart Supercenter in Tijuana.
Guillermo Washington, operations director for Wal-Mart de Mexico's northern area, said some prices at the Tijuana Wal-Mart may be higher than in the
United States, but others are lower, depending on such factors as import taxes.
The store's goal, he said, is to provide low prices with an emphasis on locally manufactured products. He said 93 percent of the store's products are
made or grown in Mexico, with an emphasis on Baja California industries.
Tijuana's border-crossing middle-and upper-middle-class shoppers might still end up crossing into the United States, a financial analyst said, but the
store is also providing choices for those who aren't willing to wait in line at the border or who don't have visas.
Analyst John R. Lawrence, with Morgan Keegan in Memphis, said Wal-Mart carefully researches its stores' consumer base.
“They probably have information that those consumers are traveling a good ways, and this will make it more convenient for them,” Lawrence said.
Three Wal-Marts exist in nearby Chula Vista, but those stores have been mostly out of reach for shoppers such as Asalea Tellez, 27, who said she's
only permitted to bring her son across for medical treatment for a congenital problem.
Yesterday, Tellez was shopping at the Wal-Mart with her two young sons, who sat in a shopping cart. Joining her was a friend and the friend's
daughter, also in the shopping cart.
“We came to see what it has to offer,” she said, with her cart full of Christmas supplies and blankets. “There's a good selection, and it's cheap.”
Until yesterday, the only other Wal-Mart Supercenters in Baja California were in the state capital of Mexicali, which has two. Another is scheduled to
open in Ensenada next month. Tijuana does have a Sam's Club, which is part of the Wal-Mart de Mexico corporation.
As in the United States, the arrival of a Wal-Mart hasn't always been embraced by Mexican small businesses. About 350 small shopkeepers have united to
oppose a Wal-Mart proposed for Cabo San Lucas.
But Tijuana residents are accustomed to cross-border businesses. On the same street as Wal-Mart there is a Carl's Jr., a McDonald's and a Burger King.
There appeared to be no protests against the store in Tijuana.
Antonio Ocaranza, director of Wal-Mart de Mexico's corporate communications, said the company has opened eight of 13 superstores planned for this
year. Tijuana's Wal-Mart is Mexico's 113th store, he said.
The corporation – which includes Wal-Mart Supercenter, Sam's Club, VIPS restaurants, and other chains – has paid $230 million in state taxes
throughout Mexico since 2000, he said.
An additional $1.4 billion in income tax has been paid to the federal government, he said, and about $700 million has been channeled to the federal
government from consumer sales taxes. Some taxes are distributed to the cities, he said.
Wal-Mart's international operations generate 20.1 percent of the U.S.-based company's net sales, according to a recent Wal-Mart annual report.
Joaquin Olaya, 27, who was shopping with his wife and 2-month-old baby, said that he didn't see Wal-Mart, which has its own auto service center, as a
threat to local businesses.
“I think that if you want something fast or nearby you will go to a small store,” he said.
Washington said the store is about 29,350 square feet, and a news release from the company said it had created 366 jobs. One of those was for Reyna de
Leon, 24. She said she used to work in a factory making air conditioning supplies where lead was jeopardizing the health of some of her colleagues.
About a mile north, shopkeepers at the Plaza Monarca, which opened five years ago with a movie theater and several smaller anchor businesses, such as
Mexico's Coppel department store, said they suspected customers would be lured to the bigger store down the road.
Abigail Cárdenas López, said she doubted Wal-Mart would offer the higher end leather products sold at the store she works at, Tijuana Fashion. Coats
there cost between $150 and $400. But she was concerned that they might lose some business as people opt to stroll through the plaza where Wal-Mart is
located.
She hoped that recent and ongoing improvements at the Plaza Monarca, such as decorative waterfalls and more shopping spaces, would keep people coming
to their mall.
“Wal-Mart arrives and it's like a BOOM,” she said. “The Plaza will have to do more to promote things here.”
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Anna Cearley: (619) 542-4595; anna.cearley@uniontrib.com
Hook - 10-28-2006 at 04:37 PM
The article completely ignores the more significant "alternative to crossing the border" for Mexicans............the jobs it created.