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?
I do think Wal-Mart could translate its merchandising strategy wholesale to another country, but i can not guarantee it will operate successful in all the countries. Wal-Mart as a merchandise store, it has to investigate the rivals and purchasing power as well as customers' purchasing habits before it enters to a completely new market. Without taking the culture and purchasing habits of customers into account could lead to failure. For instance, Wal-Mart translated its merchandising strategy whole sale to both Mexico and China and succeed. But Wal-Mart failed in South Korea and Germany.
Why do you think Wal-Mart was successful in Mexico?
Initially the retailer hit some headwinds in Mexico. It quickly discovered that shopping habits were different, so Wal-Mart adjusted its strategy to meet the local conditions, hiring local managers who understood Mexico culture, letting those managers control merchandising strategy, building smaller stores that people could walk to, and offering more fresh produce. At the same time, the company believed that it could gradually change the shopping culture in Mexico, educating consumers by showing them the benefits of its American merchandising culture. As it built up its distribution system in Mexico, Wal-Mart is able to lower its own costs, and it passed these on to Mexican consumers in the form of lower prices. T o customization, persistence, and low prices paid off. Mexicans started to change their shopping habits. Today Wal-Mart is Mexico’s largest retailer and the country is widely considered to be the company’s most successful foreign venture.
Why do you think Wal-Mart failed in South Korea and Germany? What are the differences between these countries and Mexico?
Because I think Wal-Mart knows not enough knowledge about South Korea and Germany’s culture and...
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