Walmart Foreign Expansion Case Study

Wal-Mart’s Foreign Expansion Wal-Mart is the world’s largest retailer with tons of advantage above all the rest. It is very possible that this big time retailer can translate its merchandising strategy wholesale to another country and be highly successful at it (L. Hill, 2011, p. 167). The key to this method is being able to understand the culture and environment that it would need to transition it methods to. Take for instance what was read in the case about China. China originally turned its nose up at the Americanized way that Wal-Mart presented itself when first opened in 2006.
The Chinese culture didn’t agree with meat being sold in Styrofoam or selling of dead fish. It’s their cultural preference to purchase food very freshly. So, Wal-Mart adapted to the surrounding culture. Wal-Mart was successful in Mexico because they hired local managers that were well versed in the Mexican culture and allowing them to control the merchandising strategy as they see fit. Adaption is the key to survival is different environments and economies. With Mexico being a place of few vehicles for transportation, building smaller, closer stores was another huge benefit of it being successful in Mexican culture.
When the huge retailer made steps to expand to South Korea and Germany with very little success, there was a realization made in regards to diversity and what Wal-Mart offered. Britain, Germany, and South Korea cultures have a preference of high end and higher-quality merchandise than what was offered by Wal-Mart. The low price strategy is practically unwarranted in a place to where paying more is accepted. The key difference between these countries and Mexico is that Mexico accepts the low price strategy.

Wal-Mart is succeeding in China and to continue to do so they need maintain adapting to the Chinese culture way. They are definitely on track with being successful in China. Wal-Mart is considered to be a force within the marketplace (Orgel, 2011). With the business continuing to adapt and expand throughout different nations, it’s very possible that in the future Wal-Mart will cause changes within the culture of different nations. It shouldn’t be the company’s goal to ultimately change the culture of the nation it expands to.
However, it should focus on broadening the horizon and combine the low price strategy with the nation’s culture to be an innovation on the marketplace. References L. Hill, C. W. (2011). Wal-Mart’s Foreign Expansion. In International Business: Competing in the Global Marketplace. (9th ed. ). (pp. 167-168). New York, NY/USA: McGraw-Hill/Irwin. Orgel, D. (2011, September 05). What’s driving wal-mart’s global expansion?. Viewpoints. Retrieved from http://supermarketnews. com/blog/whats-driving-wal-marts-global-expansion