Week 6 db 2

Prior to beginning work on this discussion, review the following resources:

· A Dollar Store's Rich Allure in India; A U.S. Franchise's Success Shows 'Made in America' Sells; Lessons for Wal-Mart's Entry?Links to an external site.  article

· Walmart: What Happened in India?Links to an external site.  article

· Walmart Expands Again in India - But Still Not Able to Open Consumer Stores to Consumer DetrimentLinks to an external site.  article

· Walmart’s  Our history Links to an external site.  webpage

Leaders often look for new opportunities to expand the operations of their organizations beyond the borders of the country of origin.

In your post,

· Discuss two articles that describe difficulties experienced by Walmart in attempting to expand operations into another country.

· Discuss a lesson that can be learned by leadership on attempting to expand into another country.

Your discussion post should be 250 words.

Reply 1: Melissa 100 words reply

As explained in the articles, Walmart has encountered several major challenges in trying to expand into other countries. In Germany, the German people did not receive Walmart's American-style customer service well, such as the famous Walmart greeter or bagging groceries. German shoppers found these practices uncomfortable as they were practices that they were not used to. Walmart’s labor policies did not align with Germany’s strong labor unions, causing additional conflicts. The company also struggled with strict local regulations and tough competition from other well know local retailers. In South Korea, Walmart did not adapt its business model to local preferences. South Korean consumers preferred smaller, more convenient stores rather than large hypermarkets. India was also affected by Walmart's business practices. Bellman (2007) states that “As Wal-Mart Stores Inc. and other retail giants prepare to enter India, an unexpected American rival -- California's My Dollarstore Inc. -- is already here and attracting the affluent middle-class customers WalMart and others covet” (para 2). While some countries benefit from Wal-Mart's lower prices, not all agree that cheaper is better. Walmart's focus on discount pricing did not appeal in a market where quality and brand prestige were more valued.

Other competitors better understood the market and met consumer needs more effectively, leading to Walmart’s eventual exit. The important thing for leadership is to understand and respect local cultures and market conditions when doing business in a foreign market. Companies should conduct thorough research to understand local consumer behavior, regulations, and competition before trying to gain ground (Worstall, 2017). Adapting business practices to fit local norms and preferences is important for a company's success. Flexibility in modifying traditional business models can increase the chances of success in new international markets.

References

Bellman, E. (2007, January 23). A Dollar Store's Rich Allure in India; A U.S. Franchise's Success Shows 'made in America' Sells; Lessons for Wal-mart's Entry? The Wall Street Journal. https://www.proquest.com/docview/398989638?accountid=32521&sourcetype=Newspapers

Worstall, T. (2017, April 30). Walmart expands again in India - but still not able to open consumer stores to consumer detriment. Forbes. https://www.forbes.com/sites/timworsta

Reply 2: Emily 100 WORD REPLY

One of the major issues when Walmart was trying to join India's market was the competition they had to face with the already big organization of My Dollarstore Inc. which was already attracting a lot of the consumers in the market. Although in the states usually, Dollarstores were advertising a lot of products at a dollar an item in India the Dollarstores targeted more bigger spenders who would purchase products at higher prices. How Walmart was able to deal with the problem at hand was "Wal-mart announced plans to enter India through a joint venture"(Bellman, 2007). Wal-Mart joining India's retail market had to join with an Indian partner Bharti Enterprises Ltd. which helped in having more local understanding and they already had an established presence in the market. From this situation, an organization can learn that although there are competitors that should not discourage the organization from growing. It may pose a challenge but teaming up with other organizations should not be overlooked and having the courage to go forward is the best option. The second issue with Wal-Mart expanding to the Indian market would be the regulations that India had already in place. The regulation that affected Walmart a lot was that it was "mandatory for foreign supermarkets to source 30 per cent of their products from small Indian firms"(Worstal, 2022).  With this regulation in place it puts a damper on Wal-Mart as most of their produce has not been worked with small Indian firms. This gives other organizations lessons on how to regulate international business and that it may seem easy at first but international regulations are quite different. 

Reference:  Bellman, E. (2007/01/23/, 2007 Jan 23). A Dollar Store's Rich Allure in India; A U.S. Franchise's Success Shows 'Made in America' Sells; Lessons for Wal-Mart's Entry?  Wall Street Journal https://www.proquest.com/newspapers/dollar-stores-rich-allure-india-u-s-franchises/docview/398989638/se-2 Worstall, T. (2022, October 12). Walmart expands again in India - but still not able to open consumer stores to consumer detriment. Forbes. https://www.forbes.com/sites/timworstall/2017/04/30/walmart-expands-again-in-india-but-still-not-able-to-open-consumer-stores-to-consumer-detriment/#2235ccdf1173