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WALMART STORES INC: Case Study

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Braulio Angulo

on 16 September 2011

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Transcript of WALMART STORES INC: Case Study

Interesting Facts CONTENT We star ENVIRONMENTAL ASPECT: Case of Japan What does Wal-Mart do? Walmart encountered some difficulties with its opening in Mexico prior to the passage NAFTA.
Local demand
Logistics: Poor road and the scarcity of delivery truck.
Culture (managers)
Problems solution: Trial and error We'll talk you about: History Environmental Aspects Internationalization Economical Aspects Political and Legal Aspects WAL-MART MÉXICO (Walmex) Bordered on the north by the Sea of Okhotsk, east to the Pacific Ocean and the East China Sea, and west by the Korea Strait and the Sea of Japan. Cultural Aspects When does Wal-Mart decide to internationalize? 1991 in Mexico City Trade Liberalization
GATT WAL-MARTS INTERNATIONALIZATION REASONS The population of the USA Growth was becoming flat Emerging markets have greaterpotential for discount retailing When Wal-Mart was born? In 1991, WM entered into a joint venture with Cifra: the first country in Walmart’s International division.
In 1997, WM acquired a majority of Cifra
February 2000, the Cifra name officially changed to Walmart de México (WALMEX).
In November 2006, WM received a license from Mexico’s Finance Ministry to organize and operate a bank in the country.
In November 2007, Walmart Bank began operations with 16 branches in five Mexican states. 5 6 7 8 WAL-MART - CASE STUDY by
BRAULIO ANGULO
VANNESA GIRALDO
JHON PINEDA
LINA OVIEDO Geography Aspects International Business Business Administration 2011 Headquarter When?
Where?
Why? Wal - Mart México
WALMEX Contextualization On July 2, 1962, Walton opened the first Wal-Mart Discount City store located at 719 Walnut Ave. in Rogers, Arkansas. The company grew to 276 stores in 11 states by the end of the decade. In 1983, the company opened its first Sam’s Club membership warehouse In 1988 opened the first supercenter, now the company’s dominant format Walmart became an international company in 1991 when it opened its first Sam's Club near Mexico City. Is an American public multinational corporation that runs a chain of large discount department stores and a chain of warehouse stores. Where is Wal-Mart Headquarter? Wal-Mart, headquartered in Bentonville, Arkansas, is the largest majority private employer and the largest grocery retailer in the United States. What is the value added of Wal-Mart? Wal-Mart, headquartered in Bentonville, Arkansas, is the largest majority private employer and the largest grocery retailer in the United States. COUNTRIES WHERE WAL-MART IS IN AMERICA ARGENTINA BRAZIL CANADA CHILE COSTA RICA EL SALVADOR MEXICO Total sales of Walmex stores in Mexico and Central America increased by 26.7% compared to January 2010 reached 30.759 million pesos.

For this year, the supermarket chain plans to invest 18.970 million pesos (mp)

62 percent of the investments will go to the opening of new stores and 16 percent remodeling units already in operation.

The Walmart's main market is Mexico, since 74 percent of the investments will go to Mexico (14.090 mp) and the remaining 26 percent to Central America (4.880 million pesos).

The opening of new establishments will offer 20.000 permanent jobs and over 40,000 indirect jobs. Wal-Mart entered Japan in 2002
Seiyu Ltd., the fifth largest supermarket chain in the country.
The company's sales were declining.
Avoid repeating the German mistake 2004: Seiyu reported a loss for 2004 of $117 million, more than triple its earlier projections.
Worse, the decline seems to be accelerating. Japanese: eccentric Find discounts in newspapers. “Price cut". Prices = Quality. The official language Keep a peculiar way of ancient traditions and culture Distribution systems So... What happened? “Protect smaller Japanese retailers”
"Triangular mergers". It is an industrialized urban society. Expensive and scarce real estate locations. Japan represents about 15% of global GDP. Is larger than the sum of the economies of Germany, Britain and France. Almost 3/4 parts of the economy of Asia. Japan is the world's second-largest economy. Population of 127 million and one of the highest per capita incomes in the world. The evolution of the Japanese economy is hardly surprising if we consider that this country has almost no natural resources and relies on imports for their supply of energy, food products and many raw materials. Competence Aspects Aeon Co., Ltd. is part of Aeon Group, which has 114 subsidiaries and 34 affiliates. The company is involved in a wide variety of activities: Hypermarkets and supermarkets and discount stores, financial services, restaurants and shopping center development. Aeon operates in 11 countries, mainly through its stores. Their home market: Japan and in a growing network in China and Southeast Asia. Characterized by customer partnerships at the community level, and their commitment to total customer satisfaction at all times. 2005: Aeon Co., Ltd. and Carrefour S.A. Aeon Group has become the most profitable retailer in Japan (2010) Consulting firm specializing in global retail Kurt Salmon Associates (KSA): The program lasts five years, is in the middle of their development. Increase their sales by 16% and profits by 5% over last year, with results well above those of its competitors. Its main competitors are not going to be other major facilities, but other sectors such as leisure, education and health in consumers'disposable income invested. Trial and Error "Everyday Low Prices cannot be achieved overnight, but we have to meet the challenge," Seiyu President Masao Kiuchi told reporters on Feb. 15. Centralized International Operations
Cutting the payroll, reducing distribution costs, and reduced advertising: In 2004 to dismiss 25 percent of headquarters staff, including 1,500 employees and managers.
American model application (Logistics)
Price = Quality
The company says it is being flexible, but the carping persists: open 24 hours
Dissident shareholders "We've learned that we have a lot to learn”

Wal-Mart is trying a variety of other formats, such as Livin, a multilevel department store with food on the first floor, and the Mall, a large store surrounded by dozens of specialty shops.

Wal-Mart has been pouring resources into Seiyu on a large scale.
More than three-quarters of the 392 stores in Japan now have the Smart System
The company also built a U.S.-style distribution center in Misato
Upgrading Seiyu's aging stores.

Offering more products to its customers online.

Increasing sales of its own private-label brands.

Avoid middlemen.

The biggest change is a move away from weekly specials to "everyday low prices" in areas like baby and pet care products, and, ventually, THROUGHOUT the store. Japan is one of the largest retail markets in the world yet is very fragmented, with no dominant players in terms of market share. I have no idea because WM is still there?
Neil Z. Stern, a senior partner at consultancy McMillan/Doolittle So...

Seiyu has been posting positive comparable store sales since last November, Including 1.3% gain in same-store sales in the second quarter.
Japanese consumers "have finally accepted that you CAN buy quality merchandise for a lower price Cybergraphy Kotler, P. Dirección de Marketing, 12ª edición, p.559. Walmart: About Us. [Consultado el 01 de marzo de 2011]. Disponible en <http://walmartstores.com/AboutUs/>

PR Newswire on behalf of Kurt Salmon Associates. Aeon Group se convierte en el vendedor minorista más rentable de Japón. [Consultado el 01 de marzo de 2011]. Disponible en <http://www.prnewswire.co.uk/cgi/news/release?id=72687>
 
Business Week. Japan Isn't Buying The Wal-Mart Idea. Febrero 28 de 2005. [Consultado el 01 de marzo de 2011]. Disponible en <http://www.businessweek.com/magazine/content/05_09/b3922073.htm>

HOLSTEIN, William J. Fortune: Why Wal-Mart can't find happiness in Japan . Julio 27 de 2007. [Consultado el 01 de marzo de 2011]. Disponible en <http://money.cnn.com/magazines/fortune/fortune_archive/2007/08/06/100141311/index.htm> Lessons From Wal-Mart: Five Common Mistakes When Brands Cross Borders 1. Interpret; don’t translate 2. Value is contextual 3. Playing follow the leader 4. Making assumptions 5. Ineffectual leadership by Niti Bhan, Manuel Toscano
September 13, 2006 Thank You fgcfgdfg
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