Strategy in different cultures

Walmart
Wal-Mart Stores, Inc. branded as Walmart since 2008 and Wal-Mart before then, is an American multinational retailer corporation that runs chains of large discount department stores and warehouse stores. The company is the world's 18th largest public corporation, according to the Forbes Global 2000 list, and the largest public corporation when ranked by revenue. It is also the biggest private employer in the world with over 2 million employees, and is the largest retailer in the world. The company was founded by Sam Walton in 1962, incorporated on October 31, 1969, and publicly traded on the New York Stock Exchange in 1972. It is headquartered in Bentonville, Arkansas. Walmart is also the

largest grocery retailer in the United States. In 2009, it generated 51% of its US$258 billion sales in the U.S. from grocery business. It also owns and operates the Sam's Club retail warehouses in North America. Walmart has 8,500 stores in 15 countries, under 55 different names. The company operates under its own name in the United States, including the 50 states and Puerto. It operates in Mexico as Walmex, in the United Kingdom as Asda, in Japan as Seiyu, and in India as Best Price. It has wholly owned operations in Argentina, Brazil, and Canada. Walmart's investments outside North America have had mixed results: its operations in the United Kingdom, South America and China are highly successful, whereas ventures in Germany and South Korea were unsuccessful.

1. Walmart strategy in China Walmart entered the Chinese market and opened its first Supercenter and Sams Club in Shenzhen in 1996. Currently, Walmart operates a number of store formats in China including Supercenters, Sams Clubs, and Neighborhood Markets. As of August 5, 2010, Walmart had 189 units in 101 cities, and created over 50,000 job opportunities across China. Walmart China firmly believes in local sourcing. They have established partnerships with nearly 20,000 suppliers in China. Over 95% of the merchandise in their stores in

China is sourced locally. Meanwhile, Walmart is committed to local talent development and diversity, especially the cultivation and full utilization of female staff and executives. 99.9% of Walmart China associates are Chinese nationals. All our stores in China are managed by Chinese local talent. 43% of leaders at senior manager level and above are female. In 2009, the company established the Walmart China Womens Leadership Development Commission for driving womens career development. Items that is sold only in china are crocodiles, bulk rice, mixed meat, orange juice and cooking oil, turtles, walmart brand spirits ribcage, assorted dried reptiles, boxes of liquor, frogs, a large selection of chopsticks, ducks great value brand beef, granules, pig faces and antibacterial bikini underwear for men.

Some items only sold in China 2. Walmart strategy in Japan In May of 2002, Walmart acquired a 6.1 percent stake in Seiyu. In December 2005, they acquired a majority interest in Seiyu, making Seiyu a Walmart subsidiary, and in December 2007, they increased our ownership stake of Seiyu from 50.9 percent to 95.1 percent. After acquiring the remaining shares, Seiyu became a wholly owned subsidiary in June 2008. The problems that Wal-Mart faced in Japan because of the differences between the operational and cultural environment in its home market and the Japanese market. Wal-Mart has been more than calculating in developing its infrastructure capabilities in Japan. According to Carl Steidtmann, chief economist at Deloitte Research, retail software will have to be translated into Japanese and Japanese suppliers and

retailers will have to go through a transformation to adapt to Wal-Marts technologyfocused management systems. Many analysts believe that a tight inventory management system is imperative if Wal-Mart is to become successful in Japan. Another obstacle to overcome is Japans multilayered distribution system. While Wal-Mart is quick to bypass such networks within the United States, personal interaction when doing business is much more prevalent in Japan, making these distribution layers more difficult to supersede. 3. Walmart strategy in Mexico Wal-Mart started its international operations with its entry in Mexico in 1991. 5 It formed a joint venture with Grupo Cifra SA de CV (Cifra), a well-established retail chain in Mexico.

Industry experts credited much of Walmex's success in Mexico to its entry through a joint venture with an established local player. Cifra provided Wal-Mart with the necessary understanding of the Mexican market and helped it fine-tune its strategies to suit the Mexican customer. However, the company was able to overcome these hurdles because of strong support from the Mexican government as well as common people, who were eager to benefit from Walmex's reputation as a company that offered quality products at affordable prices. Analysts said that in Mexico, protests against Walmex were led by small groups of traders who were affected by the competition on the price front, but these groups failed to mobilize the masses and other activists against the company.

Prior to Wal-Mart's entry into Mexico, people bought their regular requirements from informal street shops, where locally made and relatively cheap products were available. Nearly 70% of the population in Mexico lived below the poverty line and they depended largely on informal street shops for cheap food and clothing. Under such a scenario, Walmex's low-price strategy raised enormous interest among Mexican

customers. The low-price strategy suited the socio-economic conditions of Mexicans, which led to the company's immediate acceptance and quick growth. Walmex planned to open its first in-store bank branch in Mexico by June 2007. Walmex's bank, Banco Wal-Mart de Mexico Adelante SA, was to offer savings accounts, debit cards and consumer loans to start with and subsequently expand to mortgages and car loans. According to the company, its banks would operate within Walmex stores, but not in its restaurants. Walmex's banking unit would be WalMart's first banking venture anywhere in the world

4. Wal-Mart's International Operations In early 1990s, Wal-Mart announced that it would go global. It wanted to look for international markets for the following reasons:

Wal-Mart was facing stiff competition from K-mart and Target , which had adopted aggressive expansion strategies and had started eating into Wal-Mart's market share.

Although Wal-Mart had the scope to expand in the US, it was becoming difficult for the company to sustain its double digit growth rate. Wal-Mart was suffering from soft sales and rising inventories, especially in respect of its Sam's Club divisions.

Wal-Mart also realized that the US population represented only 4% of the world's population and confining itself to the US market would mean missing the opportunity to tap potentially vast markets elsewhere.

In the early 1990s, globalization and liberalization opened up new markets and created opportunities for discount stores such as Wal-Mart across the world.