Walmart Stategy Analysis Paper

Walmart used the growth or expansion strategy to enter to as many markets as they were able to compete in. They grew through the acquisitions of the stores that were already in the market. This action is considered as the fastest way to grow and it is mostly used to gain geographic diversification.

In the year 2005, as a part of their strategy to enter to the Latin America market, the countries that were targeted by Walmart were Guatemala with 120 stores, El Salvador with 57 stores, Honduras with 32 stores, Nicaragua with 30 stores and Costa Rica with 124 stores. In the following year, 140 stores were purchased from the Sonae chain, and in the year 2009, the expansion to Chile began by acquiring 224 stores from the D&S chain.

The Latin America market represents a great opportunity for Walmart to achieve larger economies of scale by entering to other countries and having a bigger customer base. Furthermore, new markets and countries reduce the risks of dependency by having sales from multiple geographic sources. Walmart also has the risk to be in saturated markets that cannot grow any further, in comparison to Latin America and its growth potential, so Walmart has the chance to turn into a completely global company by being present in all or most parts of the world.

Walmart will have to adapt to the choice in products by the consumers, for example, many Latin countries prefer certain types of brands and presentation. In addition, some colors are important, for example the color red symbolizes meat products and blue is hygiene, so most of the customers are used to this colors and relate them to certain types of products in their minds.

An opportunity for Walmart is the variety of products they have, because the products in Latin America are almost the same in every country and the prices of imported products is in most cases much higher, but as Walmart has economies of scale, will have no trouble respecting the price and competing with the local stores that are left.

Wal-Mart’s is considering its capability for future growth has now targeted new attractive growing countries that meets the requirements for BRIC group. The two countries that draw Wal-Mart’s attention for its future growth and expansion was India and Russia. India and Russia are widely regarded as two of the world’s fastest-growing retail markets and two of the frustrating for foreign retailers.

Wal-Mart plans to start to open 10 to 15 outlets in India through the partnership over the next three upcoming years, eventually being able to create new jobs and employ roughly around 5000 people. While Walmart’s growth has exceeded anyone’s dreams, its shifting strategies in India, highlight the difficulties of operating a worldwide company..

The Wal-Mart Company set up an office in Russia a year ago to study the market and explore all the opportunities. In Russia, the impediments to retail development are less visible but no less worrisome. Corruption is rampant with various administrative authorities capable of gumming up operations if payments are not made.

Its amazing international expansion often has the unfortunate flavor of inexperience. Dealing with foreign authorities requires finesse and charm, and even so sometimes still does not plan out as hoped. The dominance of Walmart in the United States is unrivaled; but the retailer still has to prove itself country-by- country, city by city. Even for global behemoths like Walmart, retailing is still a truly local business