Wal Mart Global Expansion Strategy Management Essay

Wal Mart worldwide Expansion Strategy Management EssayWal-Mart is the largest retail chain in the world and in addition the worlds largest corporation. The corporation started its globalization in the year 1991 when it open up a Sams club near the Mexico City. In the year 1993 the company did frame up the Wal-Mart International which was to oversee the growing opportunities of the company worldwide. Consequently, the company has enjoyed the afield operation growth and also consumer acceptance. Wal-Mart has never changed its brand names, the every daytime low price and high ethical standards although its approach to competing in the overseas has evolved over time. Due to its entry into the immaterial markets it changed its local regulatory frame work and customer tastes.Wal-Mart global blowup strategyThe global magnification strategy of Wal-Mart is provision of goods at low prices that could raise the living standards of populate around the world. This strategy involves g lobalization efforts of the company to enter into the overseas markets. correspond to Troy (1), the bottom line for the Wal-Marts company is bigger and cheaper. This is because the company intends to avow its low price kind of leadership while at the alike(p) time pursuing the aggressive stick in expansion worldwide. This expansion is facilitated by opening of new keeps and clubs world wide.How do they enter into the markets?Wal-Mart realized that if they excessivelyk to a fault long to enter into the foreign countries they would be allowing the competitors a lead that is too unmanageable to close. To avoid this end, they ventured into foreign countries to concentrate on their expansion efforts. This path that the main method utilise by the Wal-Mart come with in ingress into new markets is by venturing into foreign countries. This is ensured by either selling the products in former(a)wise retail stores which in turn distribute to the customers or by opening up its own s tore which will be used in the distribution of its products. For typeface as mentivirtuosod earlier, by the year 1993 Wal-Mart foreign operation had only one Sams club in Mexico but it ventured firm into the neighboring counties like Argentina, brazil, Indonesia china and Japan. This countries where perceived to be unique in the retail market in terms of the logistical systems, consumers and relationship in the midst of the suppliers and retailers.How do they expand while in the market?While in the market, Wal-Mart Company opened (build) more new stores in the countries it had ventured into consequently replicating the internal operation abroad. The company also expanded its markets by acquiring electromotive force companies. It also picked up new ideas from other countries which helped greatly in the expansion of its markets. This included the gravity wall from Brazil, selling shoes from Canada, selling cycles/second racks from Canada and many more (Deresky 455).Markets whe re Wal-Mart has been self-made and the reasons for the succeederWal-Mart Company has been close to successful in countries (markets) like Canada, Mexico and the UK. In Canada the company purchased all the 122 Canadian woolco dissolve stores thus becoming the Canada highest volume discount retailer. The main proponent for the companys success is the low prices of the products and the ability to strip costs from the supply chain which impresses the analysts. The suppliers are strictly authorized to distribute goods at the Wal-Marts center within 15-30 minutes of the stipulated schedules failure to which they would be fined. Again it has a lot of bargaining forefinger to extract price concession from the suppliers. In UK Wal-Mart acquired ASDA stores which were 232 in number thus becoming the biggest retailer in that country (Wal-Mart.com 1). ASDA warded of price competitions which overtook all the other companies in the UK. In Mexico, Wal-Mart Company acquired the controlling i nterest of the Mexi skunk largest retailer (Cifra) which operated stores through the county. It modified the products so that they could meet the expectations of its Mexican users (Tilly 1). at that place is one putting surface theme for the success of these three countries. For example they get to acquired nigh of the strongest companies in this countries thus becoming the leading large scale retailers and they pose also modified their products to meet the of necessity of their immediate clients.Markets where the Wal-Mart company has been washed-up and the reasons of the failure.Wal-Mart has failed in Germany and South Korea markets in particular. In Germany, the company found it difficult to adapt to the German ways and it therefore exited selling off its store (Knorr and Arndt 23). In South Korea, the Wal-Mart company also exited selling off its store because it also could non jell its operations (Awbi 1). There is a common theme as to why these two countries failed and i t was because the two couldnt adapt to the needs of the various citizens (South Koreans and Germany). These failures are specific or relevant in separately country and also similar. For example as mentioned above they have failed because they didnt localize their operations. To be specific the reason as to why it failed in Germany is because the Germany customers did not show much concern for the EDLP approach and many people also disliked its relatively low pay and ultra-frugal policy on managers billet expenses. In South Korea it experienced operation difficulties due to its merchandise mess up and the stores which were too far from the city centers. Another problem was high forage prices and lack of food freshness (Deresky 458).How does floriculture hinder the expansion of Wal-Mart in other countries?Wal-Marts culture is a hindrance to the companys expansion. This is because approximately of their practices do not go well with around people in some countries (Kitlerphiroj 1). For example in Germany the Wal-Marts expatriate managers were faced with massive cultures clashes which were helped by the refusal to learn the German language. Its culture which involved merchandise departments, supercenters far from town centers and low pries did not go down with the South Koreans who disliked the companies merchandise, the locations and high prices of commodities which led to their closure. The companys culture of acquiring building and companies and low prices helped the company in nations like Mexico, Canada and the UK for they became the largest retailers in these countries.Has Wal-Mart had to change their level and method of political interaction with governments as they have expanded internationally?Wal-Mart had to change the level and method of interaction with some governments in the process of their international expansion. For example the Chinas finance, banking, taxation and insurance organizations were bureaucratic and burdensome because the region al division of finance guidelines and tax rules created problems. For example a corporation with joint ventures in numerous locations served by a hotshot supplier had to make separate payment for each venture to the supplier. Wal-Mart Company worked together with the Chinese administration to put up a safekeeping corporation that could consolidate joint venture distribution and finance.How rough-and-ready has Wal-Mart been at maintaining their business model as they have expanded internationally?Wal-Mart has been effective in the maintenance of its business model during the international expansion because it has hold its low price culture towards its customers. Again, it has managed to be the largest retailer in some countries like Canada, United Kingdom and Mexico.The four most important lessonsThere are some lessons which can be learned from this case. One of them is that companies should train to satisfy their customers so that they can get the opportunity to expand. For exa mple most of the Wal-Marts customers are satisfied with the low prices of commodities. This has not only increased gross sales but also profits. Another lesson is that companies should consider the opinions, tastes and preferences of the people in a particular country before setting up a company in a foreign country to avoid massive losses. The other lesson is that a company should try to localize or understand the peoples preferences and tastes afterward a careful study have been carried out to avoid misconceptions that can bring losses. Another lesson is that the companies that have the interest of venturing into business in foreign countries should change and even negotiate with the various governments concerned such that they may have a favorable condition to thrive in businesswise.