Wal-Mart Stores, Inc. (NYSE: WMT), branded as Wal-Mart, is an American multinational retail corporation that runs chains of large discount department stores and warehouse stores. The company is the world’s third largest public corporation, according to the Fortune Global 500 list in 2012, the biggest private employer in the world with over two million employees, and is the largest retailer in the world. Wal-Mart remains a family-owned business, as the company is controlled by the Walton family, who own a 48 percent stake in Wal-Mart. It is also one of the world’s most valuable companies. Wal-Mart has 8,500 stores in 15 countries; under 55 different names.
The company operates under the Wal-Mart name in the United States, including the 50 states and Puerto Rico. It operates in Mexico as Walmex, in the United Kingdom as Asda, in Japan as Seiyu, and in India as Best Price. It has wholly owned operations in Argentina, Brazil, and Canada. Wal-Mart’s investments outside North America have had mixed results: its operations in the United Kingdom, South America and China are highly successful, whereas ventures in Germany and South Korea were unsuccessful. (Wikipedia, 2013)
The retail food industry is a highly competitive industry. Many companies in this sector are cutting back, re-organizing, downsizing, or closing all together. However, Wal-Mart continues to grow. Wal-Mart has been able to differentiate itself by forming a captivating identity with a deep cultural following because of its low prices and enormous buying power. However, even with all of this growth, competition is still a big threat to its’ long term success. Being the largest retailer in the world, means that Wal-Mart basically competes with everyone. All other retailers, both brick and mortar and online, are making attempts to take away Wal-Mart’s dominance when it comes to sales and earnings.
Competition is not the only threat to Wal-Mart. Being on top, usually means getting much more attention than other businesses by both the news outlets and by various government officials. Wal-Mart has more than 4,100 U.S. stores and continues to expand. Often, residents are bitterly divided over what a new Wal-Mart will mean to their community. As powerful as Wal-Mart is, community protests can still delay plans to open a new store for years or kill a project entirely. (CNBC David Faber, 2008)
In fact, six months ago, here in Boston, Mayor Thomas Menino, vowed that Wal-Mart would never be allowed to open in the City of Boston as long as he was the mayor because of the Company’s stance towards union labor. Ironically, this was at the same time when Wal-Mart made a $779,000 donation to Boston’s Children’s’ Hospital.
The chain intends to keep funding local charities even though it currently has no stores in Boston, according to Wal-Mart spokesman Steven Restivo. “Because of our [existing] relationships in the city we will continue to evaluate programs to fund whether we have stores in the Boston area or not,” he said. (Ailworth, 2012) These examples are only some from the United States.
Being an international company as well, only increases the threats to its business, especially when international expansion is a company strategy for growth. Executives stress that overseas markets represent one of the best opportunities for expansion, placing the company’s international operations at the heart of its future growth strategy. (Walmart, 2012) In my case study of Walmart, I intend to focus on some of the international obstacles that Walmart is facing when running its intrnational business. Some of these obstacles have a direct impact not only on Walmart’s profitablilty, but also on its overall image it is trying so hard to improve.
Being such a large international company exposes Walmart to significant scrutiny that it tries to combat every day in the public opinion arena. My case study, will focus on some of the internatiomnal embarrassments and problems faced by Walmart and whether or not it has long term implications for the company.
BibliographyAilworth, E. (2012, July 13). Walmart gives Boston Children’s Hoapital $779,000. Retrieved from The Boston Globe: www.bostonglobe.com CNBC David Faber. (2008). The New Age Of Walmart. Retrieved from CNBC News : www.cnbc.com Walmart. (2012, July 23). Retrieved from Walmart International at Center of Growth Strategy. Wikipedia. (2013). Retrieved from Walmart: www.wikipedia.org/wiki/walmart