medtrem Case Study walmart

Walmart Case Study

3

Walmart Case Study

Overview

The midterm is based on a mini-case from your textbook and concepts from past units. Note that Turnitin is enabled for this midterm.

Requirements

Final document should be at least 3-5 pages, which does not include the cover and reference pages.

Paper should be APA format.

Resources

Please refer to the Technology policies in the Course Overview to familiarize yourself with how the originality reporting tool works.

Mini-case

Refer to "The Globalization of Walmart" on page 255 of your textbook.

Directions

Answer the 3 questions stated at the end of the case study.

Then identify three concepts from Units 1 through 4, that relate to the information in the case study.

Briefly explain the concepts

Explain how the concepts relate to the case study content

Explain how the concepts helped to solve a problem within the case study

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Walmart Case

Ellington, David

International Bus. Perspectives

Dwobeng Owusu-Nyamekye

April 12, 2020

Q1: Reasons Walmart Viewed International Expansion as Critical on its Strategies

The “Globalization of Walmart" mini case has three concepts relating to our study content. The three concepts are globalization, competitive advantage, as well as strategic management. The global retail giant started showing signs of international expansion in the 1980s and 1990s. In the 1990s, the company expanded operations to Canada and further expanded to other countries such as China, U.K., Japan, South Korea, and Germany, among others. The company is subject to intense pressure from the external environment that influences performance and growth (Walmart blog, 2015). All the foreign countries formed a potential market for expansion and increased performance for the retail giant.

Additionally, the limitation in the home country informed the international expansion decision. Walmart developed a different vision enabling tit to open more international branches as this was an effective strategy. Customers preferred buying in the neighborhood stores due to the convenience compared to online retail stores (Walmart blog 2015). Therefore, Walmart had only one option of expanding internationally and establishing stores that were much closer to consumers. The desire to open more neighborhood stores made the company view international expansion as one of the most critical strategies for success. Therefore, the consumer needs of convenience can be said as one of the primary reasons for the international expansion of Walmart.

Q2: What Enables Walmart Success in Canada, Latin American, and Europe?

Instant discounts were one of the most successful strategies that worked on winning new customers and retaining them. There was also the retail sales factor that catalyzed market expansion through sales that made the company become the leading retail store around the world in sales and customer base. Latin America, with a specific focus on Argentina, Brazil, and Mexico, was the first target market for Walmart due to the large population in the areas. The company also developed other strategies with the primary objective of winning more customers within the target market. For instance, the primary mode of transport in Mexico is through the buses (Walmart U.S. 2015). Walmart realized the opportunity and procured parking lots within its stores where people would be picked and dropped from their homes to the business premises, thus attracting more customers. The company also handled the roadmap of its trade zone more carefully, and many interests enabling attracts more customers and eventually, more sales and profitability. The two strategies were essential in ensuring a successful international expansion strategy by Walmart.

Despite the successful strategies of Walmart in Latin America and Canada, the company did not achieve its goal in Europe. The interaction between the home market and foreign environments is essential to a successful global expansion. However, the top management of Walmart did not pay much attention to the interactions. This resulted in inadequate customer services and integration of cultures, preferences, and actions. This was the primary reason behind the failure of the company to dominate the European market (Walmart U.S. 2015). Stiff competition and pricing challenges were also the other factors that resulted in company failure. Most of the products in the European market were lowly priced, making it challenging for the company to adjust to the market.

Q3: Walmart Strategies to Ensure Success in China and India

The government of China supports and protects local businesses. This makes it's more challenging for foreign companies to access the Chinese market. However, Walmart needs to follow its globalization strategies like in Latin America and Canada to access the Chinese market despite the challenges brought by the excessive protection by the government. Walmart also needs to identify the market niche and specialize in the products that are more likely to sell more in China and India for its success in the global market. Continuous innovation is also essential for Walmart's global expansion strategies (Walmart U.S., 2015). This will improve the communication process as well as customer satisfaction, which are the primary pillars not only for the international business but others too.

Concepts in the Mini Case

Globalization is one of the most important concepts in this case. The term globalization is commonly used to describe the first and furious exchange of services, ideas, and the movement of individuals across the world. Despite the common use of the phrase, it seems different people treat is differently. Some see it as an entirely economic idea, while others primarily focus on political and social aspects when defining it. In our case, globalization can only be defined as a financial aspect of the movement of goods and services around the world (Jin, 2020). Different countries all over the world have achieved coming together through economic globalization, making international business more comfortable. Globalization concepts relate to how Walmart retailer managed its international expansion and became the world's giant retailer.

Competitive advantage is the other aspect of the mini case. It refers to the unique strategies and futures of a business that are primarily aimed at making it superior in the market. Companies utilize the product or service differentiation, making them unique in the industry (Freeman, 2010). Product or service differentiation improves customer satisfaction, which is one of the most crucial elements for the success of a business. These competitive strategies are essential to Walmart since they enable increasing sales and profitability. This eventually results in a competitive advantage.

The third concept is strategic management. This involves continuous planning, market analysis, and assessments for all the market requirements of the business to meet short-term and long-term goals and objectives. For practical analysis of the strategic market management, companies need to consider Michael Porter's five forces: competition, threats of substitutes, new entrants, suppliers, and customers (Porter & Ramirez-Vallejo, 2017). In this mini case, Walmart needs to consider the external forces to continue dominating the global market. Effective strategic management will also enable Walmart to penetrate the global market and acquire and maintain a competitive advantage in the retail industry.

References

Freeman, R. E. (2010). Strategic management: A stakeholder approach. Cambridge university press.

Jin, B. (2020). An Inclusive World: Entering a New Era of Economic Globalization. In China's Path of Industrialization (pp. 193-224). Springer, Singapore.

Porter, M. E., & Ramirez-Vallejo, J. (2017). Walmart: Navigating a Changing Retail Landscape.

Walmart blog (2015). What should Walmart do—or not do—to help ensure that the company achieves success in India? Sources: Walmart 2013 Annual Report. Retrieved from http://stock.walmart.com/ microsites/annual-report-2013/.

Walmart.US. (2015). Walmart Reports FY15Q3 EPS of $1.15; Walmart U.S. Delivers Positive Comp Sales. Retrieved from: https://corporate.walmart.com/our-story/our-business