Walmart around the World

Case Study Analysis

Feb 15, 2018 Bharat Behl

 Company Background
• Walmart Stores Inc. – largest retailer in the world

• Walmart International:
international division
sales amount to over 16% (cash cow)
11,700 retail units in 28 countries
2.3 million employees around the world
 International Operations
• Mexico City (1991) – first international store
• Canada (1994) – acquisition of 120 Woolco stores
• Brazil (1995) – stores with U.S based formats
• Argentina (1995) – own new stores
• China (1996) – stores in partnership in Shenzen
• Germany (1997) – acquisition of Wertkauf and Interspar chains
• South Korea (1998) – acquisition of stores from Makro
• United Kingdom (1999) - $10.8 billion acquisition of Asda
• Japan (2002) – 6% stake acquired in Seiyu
• India (2007) – agreement with Bharti Enterprises to establish
Bharti Walmart Private Limited
• Chile (2009) – majority acquisition in Distribución y Servicio D&S
S.A
• South Africa (2011) - $2.4 billion stake in Massmart
 International Strategy
• Aggressive globalization strategy

• Directed opportunism

• Discount retailing

• Selling high quality products at low prices (cloning of

corporate DNA)

• Plan to leverage efficient logistics, store management and

technology

• Outcome – mixed results – overseas success not universal

 Challenges
• International regulations and trade blocks

• International corrupt practices

• Strong local competition

• Cumbersome and expensive expansion

• Fragmented market settings overseas

• Cultural differences - BIG problem!

 Opportunities
• Globalization – globally growing middle class

• Scope for E – business

• Opportunity for adoption of a “transnational”

strategy

• Potential to learn about the local market from its

business partners in target countries
 Strengths
• Efficient inventory management and cross docking

• Efficient logistics and supply chain systems

• Penetration strategies – strong

• Innovation and Technology

 Weaknesses
• International adaption difficult

• Attempt to implement Everyday Low Prices (EDLP) model

everywhere

• Strict labor laws and unionization issues in company

• Public image – poor

• Lack of development of economies of scale in target

countries
Case Study Strengths and Weaknesses
• Strength(s):
Good overview of Walmart’s several international
ventures

• Weakness(es):
Walmart’s performance in other emerging markets such as
India – missing
Lack of a commentary on the company’s strengths and
weaknesses vis-à-vis global expansion
 References
• https://www.strategy-business.com/article/13866?gko=e19cb
• https://corporate.walmart.com/_news_/news-archive/investors/walmart-
announces-capital-strategy-to-drive-global-growth-next-years-capital-spending-to-
increase-slower-than-sales-1482363
• https://www.forbes.com/sites/walterloeb/2013/03/07/walmart-carrefour-tesco-
metro-successful-global-growers-what-can-we-learn-from-them/#15cf93cb2efd
• An Assessment of Wal-Mart's Global Expansion Strategy in the Light of its Domestic
Strategy
• https://medium.com/@diegonaguilar/walmart-s-global-strategy-worth-it-
96aa733f3123