An Investigation Into Pricing Strategies of Wal-Mart in China

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Independent Study

An investigation into pricing strategies of Wal-Mart in China

Module Leader: Gunjan Saxena
Student ID: 200912567
Date: 17/05/2009

Executive Summary

The report is an investigation about Wal-Mart’s pricing strategies in China, which consists of three parts.

The part 1 includes five points relevant information. To begin with, it will have an introduction for this investigation to assess the brief of Wal-Mart and its pricing strategies in China. The next is setting up one main aim of investigation Wal-Mart’s pricing strategies in China, followed by identifying three objectives of this study. The next is literature review about pricing strategies. The final is methods using in this investigation, namely secondary data. The part 2 is discussion—carrying out the investigation. This involves addressing three objectives in the part 1. This stage is divided to three sections. Section 1 is identity pricing strategies of Wal-Mart in China, including Everyday low price, Rollback and Special offers, and then finding on the Wal-Mart’s pricing strategies in China. In section 2 it will highlight competition of Wal-Mart and others, such as Carrefour, RT-Mart, Brilliance, China Resources Vanguard and Dashang. Then according to comparison, it will discover Wal-Mart’s currently development situation in China. Section 3 is to recommend how Wal-Mart’s pricing strategies improve in future. The part 3 is conclusion including summary and evaluation to identify main findings and achieves.

Table of contents

Executive Summary2
1. Introduction4
2. Main Aim4
3. Objectives4
4. Literature Review5
5. Methodology7
6. Discussion7
6.1 Identity Wal-Mart’s pricing strategies8
6.1.1 Three pricing strategies8
6.1.2 Finding on Wal-Mart’s pricing strategies in China11 6.2. Highlight competition of Wal-Mart and others12
6.2.1 Main competitors12
6.2.2 Findings16
6.3 Recommend how Wal-Mart’s pricing strategy improve in future17 7. Conclusion18
Reference19
Appendices24
Appendix 1 Wal-Mart’s sales revenues from 2003 to 2008 ($Billion)24 Appendix 2 Wal-Mart China Data Sheet in 200924
Appendix 3 Wal-Mart’s turnover in China from 2003 to 2008 (Million Yuan)25 Appendix 4 China retail industry hundred enterprises ranking in 2008 (Top 10)25

1. Introduction

Wal-Mart can be founded by Sam Walton in 1962. After 40 years of the steady development, Wal-Mart has become the world's biggest chain of retailer, having opened almost 7900 stores globally in 16 countries, serving approximately 176 million consumers each week (Wal-Mart China, 2009). In 2008, Wal-Mart ranked the top due to sales of $378 billion dollars in America magazine "Fortune 500"(Achieve Max, 2008) (Appendix 1). The reason why it is so brilliant is related to its pricing strategies, which is one of important factors for Wal-Mart’s success in the world.

In 1996, Wal-Mart entered China, following its pricing strategies, opening the first Wal-Mart store in Shenzhen. After a decade of development, Wal-Mart has opened 146 stores cover 89 cities (Wal-Mart China, 2009) (Appendix 2). In 2008, Wal-Mart’s sales were 27.8 billion Yuan (Appendix 3), ranking the ninth (China general chamber of commerce, 2009).

In this report, the purpose is to investigate Wal-Mart’s price strategies in China for Wal-Mart China Group. Secondary data from the internet, books and business reports related to Wal-Mart’s pricing strategies and its competitors can be used. In order to receive this purpose, the first point is to highlight the main aim of this report, followed by objectives. Then is literature review and methodology used to analyze this study. The final part is discussion.

2. Main Aim

This study can be defined as an investigative report to investigative into pricing strategies within Wal-Mart in China.

3. Objectives

The first objective is identity pricing strategies...
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