History of Walmart

 Walmart International is the international division of Walmart Stores

 Worlds 3rd largest retailer (Walmart U.S. & CarreFour)
 Currently present in Americas, Asia, Europe, and Africa
 Initial expansion started in 1991
 Opened up stores in Mexico and 30 other countries shortly after

Mexico

 Walmart opened a Sam's Club in Mexico City in 1991 through a joint venture with domestic retailer Cifra
 2000: Changed name to Walmex
 2013: Walmart operating more than 2000 stores catering to consumers of different economic strata
 Controlled more than 55% of Mexican Retail market

Strategies used in Mexico

 Replicate EDLP(Every Day Low Prices)

 Focus on convenience and operational efficiency
 Cheap labor created lower costs
 Partnered w/ local trucking company to perfect logistical challenges in SCM system
 Mishaps included creating large parking lots in areas where most consumers take buses

Expansion in Canada

 1994: Entered Canada by acquiring 120 of 142 Woolco discount stores

 Sales of $1.4 billion but unprofitable due to poor upper management
 Re-branded all stores
 Sales soared 265% between 1994-2000
 Used similar operating model to Walmart stores in US

Stratagies Used in Canada

 Walmart Canada followed similar operating model of Walmart US stores

 Constant marketing through local newspapers
 Carried wide arrange of furniture, consumer electronics and pet supplies

Expansion in Brazil

 1995: Entered Brazilian Market by launching stores with US based formats/operating strategy
 2004: Brought 118 Bompreco, and 140 Sonae SGPS SA stoes
 2011: Became 3rd largest retailer w/ $11.5 billion a year
 CarreFour was biggest competitor
Strategy used in Brazil

 In 2013, Walmart launched Toda-Dia, small discount stores targeted to Middle class
 Low Prices geared towards mainly towards low income earners
 EDLP model of low prices altered to meet periodic cycles of discounts which was prevalent in Brazil

Expansion into Argentina

 Entered in 1995 by opening up own stores (organic growth)

 94 stores across Argentina by 2013
 Expanded through Changomas Express
 Struggles in Argentina
o Slow expansion
o Lack of partnerships
o High Competition

Expansion to Central America

 Expanded in 2005
 Acquired 33.33% stake in CARHCO
 Operated 363 supermarkets
 Capitalized on High localized nature of stores
 Merged Mexico & Central America operations in 2010
 Sales over $4 billion dollars

Expansion to Chile

 Entered Chile in 2009 by acquiring/controlling stake in Distribucion y Servico (domestic player)

 Built large network
 Credit Services- simulated net growth for WalMart
 2012: Held 34% of market share with 300 stores

China

 Entered China in 1996, partnering w/ local investor to open Walmart Super center and Sam's Club
 Chinese regulations required joint ventures
 They began targeting middle class with EDLP model
 They struggled replicating the success
 Landscape of China highly fragmented
o 1000s of mom and pop stores
o many instances caused them to have limited success
 Walmart operations yielded profit in 2008, 12 years after they entered the market
South Korea

 Entered in 1998 by acquiring handful of Marko stores

 EDLP model poor fit for South Korea because of their luxurious, service oriented shopping habits
 Local consumers wanted diversity amongst products
 Faced Stiff competition from local stores
 8 years of disappointment results in a loss of 9.9 billion dollars in 2005

Japan

 Entered Japan in 2002 acquiring 6% share in Seiyu, struggling supermarket chain

o Created to Seiyu into a whole new subsidiary
 Once again struggled to replicate EDLP model Japanese consumers associated low prices with low quality

Europe

United Kingdom

 1999: Acquired ASDA to enter UK

 Strategy:
 EDLP model
 Growth and new customers
 Lobbying the new govt

Germany

 Acquired 2 companies: Wertkauf &Interspar

 Culture factors: Walmart failed because of cultural reasons
 "This is Not America"
 Struggled to cooperate with Labor unions, local laws and regulations

Africa

 Entered in May 2011

 Acquired Massmart Holdings
 Struggles:
o Rejections from Labor Unions
o Acquired only 51% of Massmart
 Success:
o Lessons learned from the past
o Low Price Strategy
o Under developed retail market
o Helped Suppliers streamline operations
GreenField Vs Acquisions?

The answer is.... Acquisitions, Here is why!

 shown higher success through acquisitions

 related acquisitions known to help company enter through increased market power and avoid certain
barriers of entry
 incresed diveesificaiton and speed of market