Wal-Mart Essay

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CASE – Wal-Mart’s Foreign Expansion Do you think Wal-Mart could translate its merchandising strategy wholesale to another country and succeed? If not, why not? Yes and no. The reason why I say that is because it depends on which country Wal-Mart wants to penetrate. As the case says, Wal-Mart didn’t succeed very well in developed countries, such as Germany and South Korea because they preferred higher quality merchandise and didn’t care about the discount strategy. In addition, in the countries Wal-Mart tried to penetrate, local stores were well established and had matched the preferences and needs to the customers in a very satisfying way. On the other hand, I think, less developed countries will be more responsive. They will definitely fall for that kind of strategy. With that said, it is important to adopt culture, norms and ethics. May be use some, or all, of Hofstede’s dimensions – power distance, individualism VS collectivism, uncertainty avoidance, and masculinity VS femininity. Why do you think Wal-Mart was successful in Mexico? Wal-Mart adjusted its strategy to meet the local conditions, hiring local managers who understood the Mexican culture, letting those managers merchandising strategy, building smaller stores that people could walk to, and offering more fresh products. They also believed that they gradually could change the consumers’ behavior by educating them in the benefits of the U.S merchandising culture. That’s what happened in the U.S in the 1950s. As it built up its distribution systems in Mexico, Wal-Mart could lower its own costs, and it passed these savings on to Mexican consumers in the form of lower prices. The customization, persistence, and low prices paid off. Mexicans started to change their shopping habits. They also started a joint venture with Cifra, Mexico’s largest retailer, to a series of supercenters that

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