Walmart Around The World Harvard Case Solution & Analysis

2) Cut down Its Operations in Asian Market

Walmart should not penetrate into such market where there is no estimated scope, such as the country like China, where people are more driven to the native local things than trusting other. Therefore, they were forced to exist which occur so much loss of investing there. Continuous striving for market share in such market could result into wastage of a lot of time and money. To select the most appropriate location to establish the ventures is most significant for the success of Walmart. Operating and investing in a wrong location by being optimist that it will grow cannot be possibly wise decision. Not every market is suitable for the strategies of the organization

A company's location strategy should conform with, and be part of, its overall corporate strategy. Hence, if a company strives to become a global leader, then it is necessary for them to establish setups in regions that are consistent and go along with its strategy. Cutting down operations in that region can save a lot of money and time which can be effectively utilized in any other alternative.

Countries like in China, South Korea, and Germany; Walmart keeps on striving to survive which needed a lot of extra effort and time. Although the company tried all the ways to get into the better state in those countries too, however, Walmart needs to understand that it is not beneficial in the long term, and it is better to cut down operations and do not further consider investing in them

Thus, if the Ventures in any country are not profitable, then it is wise to wind up all the operations from there and stop investing any more on it.

3) Extensive Research before Entering in Asian Market or Markets like Them.

Walmart should highly emphasize on the research before entering into Asian Market or Markets like them. Research has always been important and crucial in any domain. It is the process of gathering information from customers and interpreting to retain customers and attract new ones. It is needed to know the buying behavior of the customer because to predict about it without enough authentic data can be problematic.

Because if after establishing the business, Walmart fails to take into account the customer’s interests and needs then it can cause heavy losses. Walmart should not only first do complete research about the social, economic and political factors of the region but also should do proper marketing so that the people, suppliers and other concerned bodies should know better about them and only then they will like to do business with them. Also, people may buy only after having the proper knowledge.

Walmart should not believe anymore that the sale ends their relationship with a customer. Nearly one-third of the research revenues generated by the leading U.S. research company’s concern customer satisfaction. Companies want reassurance that the customer enjoyed the buying experience and that the product or service lived up to the buyer's expectations. Walmart should do researches to encourage customer satisfaction responses.

That is why, before entering into the market of a country like India, Walmart needs to analyze keenly what obstacles it had faced while penetrating in China and South Korea. However, for that investment, proper budgeting should be needed in order to find that the revenues that Walmart can reap would be worthy and how long it will take to get back the invested amount and to reach breakeven. A significant advantage research is that it combines important problems that should need consideration and can be solved as soon as identified.

Decision Choice

Walmart decided to start its operations in early 90 s because the company realized that maximum opportunities were considered, and it would be better to explore new market around the world. Some of the investment decision might not go right like in Chinese market, but if alternative three would consider than the probability of failure would reduce to a great extent. By thorough research, the consumption pattern of the consumers can be learned and then company can operate accordingly and more effectively.

Moreover, population density and accessibility should be considered and to locate the stores within the local customers interest and with the high accessibility to distribution systems and infrastructure. Local regulation along with international agreements must also be checked. In order to compete with the domestic market, it is utmost important to retain core competencies by acquiring similar companies and local network with high performance reputation.

To become number one departmental stores chain, Walmart has to expand its chain in many countries and to incorporate with different countries social, economic and political value, a lot of research is needed or else it would be extremely risky investments for Walmart to establish ventures in new countries and markets before estimating the risks and returns. Along with this, to reduce the expected risk, research beforehand is so crucial and important for Walmart

Conclusion

After replicating its successful United State business Model in Mexico, Canada, Brazil, Argentina, China, South Korea, Japan, Germany, United Kingdom and Africa. Different results from these ventures are identified along with its reasons and elements like; venture’s location choices, times of entry and modes of entry. Problem is the failure of its operation mainly in Asian country which raised a question for Walmart that what are the chances of its success if the company planned to go for expansion in India in 2013.

In order to overcome the problem, three alternatives was considered which are; 1) Improve the Quality and Technology of Existing Stores Along With Expansion,2) cut down Its Operations in Asian Market or 3) Extensive Research before Penetrating in Asian Market or Market like Them. The best alternative would be the third one, as Walmart would be able to operate different markets with low risk of failure and more expected return. This is because alternative one discusses investing on already established areas which is already giving enough profit without any further investment need so spending on it would not be that significant for Walmart.

Second Alternative focuses on cutting down the operations of not so profitable regions. It also highlights that continuous striving and forcing itself for market share is not fruitful in short-term and does not seem any beneficial in a long term. Besides that, by cutting down operations there will be heavy loss as all the operating investment which has already done will go in vain. That is why the third alternative seems to have maximum potential to give more of the benefits.

Indeed the research is costly; however, it is worth conducting in order to gain valuable information of the social, economic and political environment as well as the customer preferences and needs in order to guard from any future problems that may occur while operating in regions outside the United States.......

 

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