Several months ago, Chinese clothing executive Shao Zhuliang of Boshan Linar Garments Co in eastern Shandong province was told by his top client that it would not be placing any orders for the spring 2008 season, the Wall Street Journal reported.

"Wal-Mart said they had inventory piled up over there. It's always hard to make money from Wal-Mart orders, but without them, we are finished," Shao said adding it scaled back its order for the fall 2007 season from 500,000 pieces to about 100,000.

A softer US economy, rising gasoline prices, a strengthening Chinese currency and business miscues have left the world's largest retailer with a growing amount of unsold goods in its stores, including about two billion dollar worth of clothing.

"Wal-Mart is no different from any other retailer going through a tough time," Marc Compagnon, an executive director at Li and Fung Ltd, one of the world's largest apparel-sourcing firms, was quoted as saying.

"Anyone doing business with a retailer having trouble is going to suffer the consequences," he said.

Boshan's challenges are a sign of the risks of over-reliance on exports to the US, the report said.

Wal-Mart imported 18 billion dollars in goods from China in 2004.