Premium Essay

Globalization and Walmart

In:

Submitted By raven711
Words 451
Pages 2
Globalization

Retail giant, Wal-Mart will always have competition however they have successfully cornered the market with the use of several strategies including Globalization and expansion through the horizontal market. Entering the global market is never exclusively the result of a grand design, it’s an approach that requires opportunism and flexibility within a broad direction set by a systematic framework (Govindarajan & Gupta, 2002). Wal-Mart made the decision to enter the international arena after it was established that they had saturated the United States domestic market, which only accounts for 4 percent of the World’s population (Govindarajan & Gupta, 2002). Wal-Mart executives realized that they were missing out on 96 percent of the World’s possible customers. In addition, “other competition had already capitalized on such growth tanks to the rapid expansion of information technology, increasing cultural homogenization and lowered trade barriers” (Govindarajan & Gupta, 2002). In order to live up to the current competition, Wal-Mart had no choice but to pursue globalization aggressively. Wal-Mart had leverage entering international territory, exploiting its buying power with supplier giants including; Proctor & Gamble, Hallmark, Kellogg, Coca Cola, Pfizer and Revlon to secure low price goods for its new non United States stores. The global expansion began in 1991 and during the first five years, Wal-Mart established a strong presence in Mexico, Brazil, Argentina and Canada (Govindarajan & Gupta, 2002). Today, Wal-Mart operates over 11,000 retail stores, with more than 6100 international stores (corporate.walmart.com, 2015). Wal-Mart’s international division is currently the fastest growing sector of the business (corporate.walmart.com, 2015). To continue their massive success, Wal-Mart will continue to open stores Worldwide.
Horizontal Market

Similar Documents

Premium Essay

Globalization of Walmart

...gaining 12.7million in sales. By 1969, Sam Walton realized that Wal-Mart was going to be much bigger than he anticipated and he officially incorporated as Wal-Mart Stores, Inc. (Walmart). In was not long after he incorporated the company that Sam or Mr.Sam as many called him, decided to take Wal-Mart national. His vision’s widespread appeal was so successful among Americas that by 1972, Wal-Mart was listed on the New York Stock Exchange as WMT. At this point Wal-Mart was growing so fast and being so successful that by 1990, Wal-Mart had officially became the nation’s number-one retailer. Their focus was still to provide its customers with a one-stop shopping supermarket that had every day low prices (walmart). Wal-Mart had become so successful in America due to its size, power, and low prices that globalizing was just a matter of time and money. At first, Wal-Mart considered entering Europe, Asia, and other countries in the western hemisphere. However, they realized that they did not have the financial, organizational or managerial resources necessary to enter all of them simultaneously. Therefore, in 1991 through 1995, they focused on establishing a presence in the Americas instead. The countries they would target first would be Mexico, Brazil and Argentina. According to Theodore Levitt, the globalization is at hand. Levitt claims that the multinational...

Words: 1560 - Pages: 7

Premium Essay

Globalization of Walmart

...Globalization of Walmart Mg 460 George Rideout Lisa Baron November 10, 2014 The location of the first Wal-Mart in the Fortune Global 500 for the year of 2001 to 2002 turnover of 219.81 billion dollars. Wal-Mart is the largest company in the retail in the world. The company was much larger than its competitors in the United States - Sears Roebuck, Kmart, JC Penney and Nordstrom combined. In 2002, Wal-Mart operates more than 3,500 discount stores, Supercenters and Sam's Clubs in United States and over 1,170 stores in major countries around the world. The company also sells products online via the website, www.walmart.com. Wal-Mart is one of the largest private employers in the world, with the use of force about 1.28 million. The founder, Sam Walton (Walton) has always focused on improving sales continue to reduce costs, adopting efficient distribution and management systems and logistics innovative information (IT). According to analysts, Wal-Mart has been able to achieve a leading position in the distribution, following effective management of the supply chain practices. "Consumers who shop at Wal-Mart want a quality product at a great price," says David Schwartz, CEO of Framingham, MA-based Productive Environments, Inc. (PEI), a licensor of stationery products. "But at the same time, they need better products just as much. They will know a good price value when they see it. It is expected that programs that build this value-added into their brand will sell...

Words: 1256 - Pages: 6

Premium Essay

The Globalization of Walmart

...What is Tax? A fee charged ("levied") by a government on a product, income, or activity. A means by which governments finance their expenditure by imposing charges on citizens and entities. Governments use taxation to encourage or discourage certain economic decisions. For example, reduction in taxable personal (or household) income by the amount paid as interest on home mortgage loans results in greater construction activity, and generates more jobs. If tax is levied directly on personal or corporate income, then it is a direct tax. If tax is levied on the price of a good or service, then it is called an indirect tax. The purpose of taxation is to finance government expenditure. One of the most important uses of taxes is to finance public goods and services, such as street lighting and street cleaning. Since public goods and services do not allow a non-payer to be excluded, or allow exclusion by a consumer, there cannot be a market in the good or service, and so they need to be provided by the government or a quasi-government agency, which tend to finance themselves largely through taxes. What is VAT (Value Added Tax)? VAT was introduced into the Indian taxation system from 1st April 2005. This is a kind of consumption tax which gets imposed on products or services at different stages of manufacturing and at final sale. This is a multi-point process of levying tax on value addition which is collected at different stages of sale with a provision for set-off for tax...

Words: 849 - Pages: 4

Premium Essay

Globalization Walmart

...Globalization David C. Charnley MGT/230 September 26, 2013 Lenny R. Washington, MBA, DTh. Globalization In today’s national and international markets there are no longer any limitations as globalization has changed the way business is conducted at nearly every corporate level in the United States and abroad. The Internet has made the world a smaller business environment with companies both big and small reaching across borders to create new opportunities anywhere in the world (Bateman & Snell, 2011). Successful companies have made adjustments in their business models ensuring that taping into the international market with keep them relevant and profitable; in some cases businesses like Wal-Mart the largest international retailer in the world began globalization as early as 1991 in Mexico City (Govindarajan & Gupta, 2002). Another factor in globalization is that corporations like Wal-Mart are consistently searching for overseas talent that can be hired in a niche market. This gives them an edge by having a local asset that understands the culture and best business practices of a specific geographic location. With a total workforce of over 950,000, Wal-Mart had more than 130,000 employees in 729 facilities outside the United Sates by 1999. That level of globalization has affected how products and services are provided to the global market. Wal-Mart and other competitors can get their products, services, and information to the consumer any time, any location, with no limits...

Words: 281 - Pages: 2

Free Essay

Walmarts Successful Globalization Into the Chinese Market

...Walmart’s Successful Globalization Into The Chinese Market Stanley Armstrong Southern New Hampshire University Abstract There has been an increasing enthrallment over global expansion across the globe. Likewise, there are many things that factor into making such an enormous decision a successful one. Some of these factors include, the strategies to which the business will use, what modes of entry they will take, and what are possible threats and opportunities that may arise. Choosing the right strategy to enter into a new market is key in determining the success of the company now and in the future. I. Introduction “Walmart Stores, Inc. was founded by American retail legend Mr. Sam Walton in Arkansas in 1962. Over nearly 50 years of development, the company has served customers and is now the world’s largest private employer and retailer, on the top of the Fortune 500 list. Walmart is among the most recognized global brands.” (Walmart China Factsheet) II. Global Expansion Lately, many large companies within the retail division who seek to increase their profits and hold a greater market share have decided to expand their companies globally. Global expansion has grown to the point where its not only attacking large companies, but has increased the efforts of those small-scale companies, those who are foreign to expanding internationally, and even those who have already ventured into international markets. There have been...

Words: 1864 - Pages: 8

Premium Essay

Globalization

...Globalization Walmart Corporation has expanded to over 10,000 stores across 27 countries in the world. Globalization has allowed Walmart to meet the demands of families all around the world. Globalization has positively impacted the Walmart Corporation. Within the Walmart Corporation globalization was made possible by the use of the four functions of management. It is through the four management functions that Walmart has been able to become as successful as they are today. Through planning Walmart has been able to develop a process that allows them to provide affordable products and food to people all around the world. Through organizing Walmart has developed programs that help people in need while continuing to build their client base. “Through Walmart’s Global Women’s Economic Empowerment Initiative, Walmart helps provide more training, market access and career opportunities to nearly 1 million women, many on farms and factories, ultimately allowing them access to the economic opportunity they deserve” ("Walmart", 2013). Through strong leadership Walmart has “worked hard to build an environment that emphasizes integrity, respect, open communication and innovation. Whether it’s a part-time job or the career of a lifetime, working at Walmart means opportunity” ("Walmart", 2013). By monitoring the company’s success and areas that need improvement Walmart has been able to develop processes that improve these weak areas. Walmart acknowledges the importance of helping strengthen...

Words: 269 - Pages: 2

Premium Essay

Internal and External Factors

...1 Internal and External Factors Of Walmart Quashada Rogers MGT/230 11/17/2014 Dick Hobbs 2 INTRODUCTION Management is a vital instrument for the success of any corporation. In any company, it is the duty of management to organize events and use all available materials/resources to meet precise needs and objectives while complying to company policies. Managers are and play an important role in any corporation; giving it formation and providing a uniformed line of correspondence necessary to sustaining operations. Diversity and ethics play a huge role in a corporation as it takes the different aspects of a corporation and display the values used for decision-making. There are many different factors that affects all management functions but when used properly by an corporation it will help stay ahead of its rivals. Using Walmart, a multi-billion dollar department store, as an example, the following will give an explanation of how internal and external factors like technology, globalization, innovation, ethics and diversity affect the four functions of management. External/Internal Factors The four functions of management (organizing, leading, planning and controlling) and the way they’re affected by internal and external factors effects the way that management makes determinations...

Words: 2017 - Pages: 9

Premium Essay

Internal and External Factors

...Erica Richmond Internal and External Factors Management is impacted by the external and internal factors of technology, globalization, ethics, diversity, and innovation. For the Walmart Corporation, the internal and external factors are applied towards maintaining their position as a leading retailer. A comprehensive strategic plan includes a situational analysis that considers internal strengths and weaknesses. Walmart’s current strengths and weaknesses provide a wealth of insight helpful in accomplishing internal goals and internal analyses can provide advantages for achieving external goals, as well. External opportunities include things such as gaps in the market that no company is currently serving, new markets and other clear growth opportunities. External threats include new product releases from competitors and new competitors arising in the market. Globalization Globalization is a process of interaction between companies, people and governments of different nations. Investments and international trade guide this process. Information technology is also an important part of this process. Environment, culture, economic development and political systems are all effected by globalization. Many think globalization is a new process but quite the contrary. For many, many years’ people have been buying and selling goods to each other in lands far away. In the same...

Words: 1599 - Pages: 7

Premium Essay

Internal and External Factor Paper

... Organizing is described as “assembling and coordinating the human, financial, physical, informational, and other resources needed to achieve goals.” (Management, Pg. 15) After a manager has implicated a plan, they would then want to organize the plan by delegating authority, assigning work and providing direction to the employees. Controlling is described by “monitoring performance and implementing necessary changes.” (Management, Pg. 15) After a goal has been completed, the manager may monitor the performance by employee that may include, but not limited to, monetary goals, reducing customer complaints or simply meeting a quota at a specific time. Walmart is an organization that uses strategic planning and organizational tools successfully to manage and market technology. Walmart is well known throughout the world, using technology to heighten their sales, along with innovating new ways to make their organization grow a very diverse culture and try to be as ethical as they...

Words: 1109 - Pages: 5

Free Essay

Walmart in Mexico Controversy

...Walmart Mexico Controversy 7/17/2012 Professor Breskin, International Business Walmart has been bribing Mexican officials to add store locations. Back in May of this year it had come to the attention of Reuters investigators, the New York Times, and other sources that Walmart had acquired its many new store locations in every corner of Mexico through bribery. Even if that is “just how they do things down there”, is it alright that a company that if it were a country would make it on par with the GDP of the 25th largest economy in world to behave in this manner? In today’s globalization much is changing within all the different cultures in the world, it is sad to see this happening but globalization is necessary. That being said, when this happens we the people need to minimize any possible corruption as things play out. Mexico is a country where almost anything can be bought with enough money. All Walmart did was play by their rules, but on the other hand, Walmart cannot do that because they represent a large US company and future globalization, they need to set the example. Walmart has been working for a while now to fix their public reputation and then they let something like this happen. Walmart claims they had no idea this was going on, and to an extent I believe them but also believe they weren’t too eager to make sure it wasn’t happening. The desire to avert negative publicity is understandable. Attempting to through concealment inevitably leads to more crisis...

Words: 278 - Pages: 2

Premium Essay

Ethical Perpectives

...Arkansas. While that store was successful, he felt as though it was time to move on to bigger and better things. That same year, he opened a second store in Rogers, Arkansas and rebranded the stores as what is known now as Walmart. Since then, they have become one of the most well known retailers in the world. In a seventeen year period, the chain had grown from one store to 24 across the state of Arkansas which reached over $10 million in sales. Currently, the chain operates stores in 27 different countries under 69 different names (Walmart, 2013). The founder, Sam Walton had the vision of selling large amounts of product at costs much lower than its competitors. This was done by keeping their profit margins low. Walton's vision was definitely a successful one, reportedly, the store sells over $42 million in merchandise per hour. With great success, there also comes great strife as well and the company has also had its share of controversy. The Walmart corporation has based their business model on profit. Their moral perspectives and ethical views are aligned with this ideology as well. The company has globalized and continue to expand based on their low operating costs which flow down to the prices of the products they provide. Walmart has faced much scrutiny but are able to withstand much criticism when it comes to their legal ethical practices. Issues come into play when virtue ethics come into question in regard to the treatment of their employees. As...

Words: 1161 - Pages: 5

Free Essay

Globalization in India

...Aspects of globalization Globalization basically means the arising cultural and economic process between different parts of the world. The big question about globalization is how big of an impact it has on the third world countries. If you look at the western companies and the workers conditions, you get to see the hidden face of globalization. Has globalization had a good or bad impact on the third world countries, and is globalization even a good thing? Western companies and workers in the Third World The world is becoming increasingly globalized. As Western companies and consumers push for lower prices, working conditions in manufacturing countries are affected. Some of the largest companies in the world, such as Walmart, have some of their products come from third world countries, such as India. Some of the products that Walmart provides are made by human beings, under the worst conditions you can possibly imagine. As an example, young people and women are making some of those products every single day. The workers have to walk to work, which takes at least an hour, because they can’t afford to get there by another other means. They work in buildings where it’s over 90 degrees Fahrenheit, which makes it almost unbearable to work. At the same time they are rushed by their superiors, who by the way are mostly men, to work even faster. If the women fail during work, they are beaten or punished in other ways, and as a site note, they get fired around the age of 35, since the...

Words: 806 - Pages: 4

Premium Essay

Organizational Assessment

...ORGANIZATIONAL ASSESSMENT Organizational Assessment Sherry Crowe MGT416 Operations Management A02 Dr. Carson March 19, 2014 Argosy University The Wal-Mart Corporation On May 9, 1950, Sam Walton opened up Walton’s 5&10 in Bentonville, Arkansas. The first store with the Wal-Mart name, opened in Rogers, Arkansas in 1962 and was financed 95% by Sam Walton himself. Since its beginning in Arkansas, Walmart has helped millions to save money and live better. Walmart has changed from being a retail store accessible with set hours to be available anytime and anywhere for their 245 million customers. Walmart offer its 245 million customers retail shopping in 11,000 stores under 69 banners in 27 countries and e-commerce websites in 10 countries (Wal-Mart Stores, Inc., 2013). The company is considered one of the largest employers in the world; Walmart employs 2.2 million associates worldwide. In the U. S., Walmart Supercenters, Neighborhood Markets, and Sam's Club warehouses comprise the choices of Walmart stores to which customers have access (Wal-Mart Stores, Inc., 2013). As Walmart continues growing successfully the corporation has experienced global success, which has led the corporation to be in constant of change of strategies that provide that the corporation continues fulfilling its mission while offering new products, bettering the human resource management and developing its personnel, and expanding its social responsibility by helping the different communities where stores...

Words: 4706 - Pages: 19

Premium Essay

Learning Team Siscussion Wk 5

...effects of globalization on business. All team members felt they gained a lot from the readings and teaching this week, despite having some areas that caused us to struggle. There were many lessons that we will be able to apply to our places of employment in the future. Benchmarking Analyses Last week we focused on benchmarking.  "Benchmarking compares and organizations practices, processes, and products against the world's best," (Nickels, McHugh, & McHugh, 2010). Benchmarking can be used to gain a competitive advantage by allowing an organization to compare existing performance against their competitors to identify areas for improvement.  If your competitor out performs you in an area, you evaluate that process and see how you can improve to become better than your competitor.   For example, "Target may compare itself to Wal-Mart to see what, if anything, Wal-Mart does better. Target will then try to improve its practices or processes to become even better than Wal-Mart" (Nickels & McHugh, 2012).  So if Wal-Mart were to be better at shipping items than Target, Target would evaluate that process to see how they could be better at shipping than Wal-Mart.   In conducting a benchmark analysis this week between Sam’s Club and Costco, it is observed that Sam’s Club has a very evolved supply chain management system, making use of technology such as radio frequency identification chips. Costco, which carries far fewer items than Sam’s Club or Walmart, might be...

Words: 1244 - Pages: 5

Premium Essay

Walmart--Industry Analysis

...Wal-Mart Stores Inc. (WMT-NYSE) is a worldwide retail stores, which is the largest retailer in the world, found by Sam Walton in 1962.There are three major segments: Walmart US, Walmart International, and Sams Club. These retail stores include discount stores, hypermarkets, supercenters and others. Industry Analysis The major business revenue of WMT is from supercenters and Sam’s Clubs. So we focus on the industry of supercenters and warehouse clubs in the US. 1. Define the industry----Supercenter and Warehouse club industry Supercenters are some large department stores that retail various goods and service to customers such as groceries, apparel and accessories. Supercenters and warehouse clubs are different. Warehouse clubs provide membership programs to customers, which charge the membership fees and then offer many goods in bulk with discount price. The market size of the industry is estimated as $453.8 billion, and the profit is $21.3 billion in 2016. The annual growth rate from 2011 to 2016 is 1.8%. The customers in this industry are householders. Based on the market research, 55% consumption of customers is food and beverages, 23.1% consumption of customers is food and appliances. The technology development in the industry is steady. For example, point-of-sale (POS) systems and radio-frequency identification (RFID) technology are used to improve the efficiency of operation. Revenue in 2016 | $453.8bn | Profit in 2016 | $21.3bn | Annual Growth...

Words: 1053 - Pages: 5