The History Of Walmart

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Walton grew up in a rural area in the United States. He tried lots of things such as running variety stores before founding Walmart. Walton believed that discount stores could succeed in smaller markets based on the success of many Ben Franklin stores which were located in smaller markets. From the beginning, Walmart focused on small-towns, in rural or suburban areas. In 1962, Walton started his first Walmart store in the small town of Rogers, Arkansas. Then, Walmart grew up by following Walton’s expansion strategy in which new stores should be adjacent to existing Walmart markets and distribution lines. (Ortega, In Sam We Trust) Besides the concern about geographic location, Walmart also understood customers’ shopping habits - they preferred…show more content…
This was one of the most profitable hypermarket chains in Germany at that time. (Taking Wal-Mart Global: Lessons From Retailing 's Giant) It seemed that everything was perfect! The strong local player Wertkauf would help Walmart achieve success in Germany. However, in July 2006, Walmart withdrew from Germany due to sustained losses. (Matthew Boyle Wal-Mart 's Painful Lessons) Walmart overestimated the German culture and its political similarity to the United States. Walmart initially used American executives who had a poor understanding of the German consumer. (2006, Wal-Mart Finds That Its Formula Doesn’t Fit Every Culture) For example, they tried to sell packaged meat; but, Germans like to purchase their meat from a local butcher. The one-stop shopping convenience idea, which worked very well in the United States did not work in Germany. They preferred the daily shopping experience and perusing a variety of local stores with more specialized goods instead of the bulk shopping at Wal-Mart. In Germany, sales clerks smiling at customers was interpreted as flirting. Moreover, Walmart never built good relations with the German Labor Unions because it continued to have distain for the union ideology like it did in the United States. This opinion did not set well with the German people who are closely connected with their…show more content…
By learning from its defeat in Germany, Walmart has been able to make progress in its strategy to expand into the Chinese market, which also has a substantially foreign political and cultural environment. Along with its financial capability, advanced supply chain management capability, and information technology capability, Walmart adapted its business strategy to align itself with the local taste. For example, Walmart sources about 95% products locally and hires Chinese citizens to manage its stores. Due to the heavy pollution and poor safety management, Chinese customers are concerned about the quality of products made in China. Walmart developed private label brands priced 10%-40% cheaper than national brands which positively impacts Chinese customers by providing them with high quality products and low prices. (2015, Wal-Mart And China: A Story Of Missing Customer Trust) Currently, Walmart is the third largest retail chain in China, and plans to open 115 brick-and-mortar stores between 2015 and 2017. (2016, Wal-Mart talks Up China Commitment) Walmart also plans to push up its e-commerce business to leverage its huge global product network. But even then, to ensure its future growth in China, Walmart needs to continually monitor its multicultural

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