Walmart

Walmart: globalization strategy

• Company presentation:

We gonna present you Walmart.

Wal-Mart is an American multinational society specialized in the mass distribution. It was founded in 1962 by Sam Walton. With a turnover of 476 billion dollars it is nowadays the first retailing group in the world before Carrefour. It is present in 50 states, including for instance Puerto Rico, Canada, China, Mexico, Brazil, Germany, Britain, Argentina and South Korea.

• Why did they need to go abroad?

Walmart needed to increase its growth to survive and for this it had to go outside the United States because:

• Saturation of its domestic market
• US represents only 4 % of the world population  
• Emerging markets with lower disposable income offer huge platforms for growth in discount retailer
• Europe: Mature market, with fierce competition, , lack of strong customer relationship  
• Latin America: Closest market, large population, emerging countries      

Implantation:

This table sums up the different entry modes of Walmart. It is mainly through acquisition (when a firm buy another one) or joint venture (when two firms work together and share the stake of the company)

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American Markets:

Wal-Mart entered Canada through an acquisition. There is three reasons for this. First, Canada was a mature market, so it would have been useless to add new stores as the competition was already high. Then, income and culture are nearly the same in the United State and Canada, so there was  not need to learn a lot, so joint venture was not necessary. Finally, there was an economic opportunity: Indeed Walmart bought Woolco, a failed store, at an attractive price.

Key Success Factors

• A supply chain with integrated technology
• An ability to generate large sales volume
• Everyday low prices
• A strong and unique culture (US)
• Goodlogistic systems
• Decentralized operations

Concl

• Strong international presence
• But, faced some difficulties

• New objectives     : ready to exceed the symbolic milestone of the 10 thousand shops

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