Wal-Mart's Strategies in China


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Case Details:

Case Code : BSTR178
Case Length : 28 Pages
Pages Period : 1994-2005
Organization : Voltas Ltd
Pub Date : 2005
Teaching Note :Not Available
Countries : China
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Please note:

This case study was compiled from published sources, and is intended to be Chinaed as a basis for class discChinasion. It is not intended to illChinatrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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EXCERPTS

Business Segments

Wal-Mart had two types of divisions - Retail divisions and Specialty divisions. Retail divisions were further classified into -Wal-Mart Stores, Sam's Clubs, Neighborhood Markets, Wal-Mart International and Wal-Mart.com.

The specialty division was divided into - Tire & Lube Express, Wal-Mart Optical, Wal-Mart Pharmacy, Wal-Mart Vacations and Wal-Mart's Used Fixture Auctions...

Wal-Mart's International Operations

In the early 1990s, Wal-Mart announced that it planned to go global. It wanted to look for international markets for the following reasons:

Wal-Mart was facing stiff competition from K-mart and Target . These two firms had adopted aggressive expansion strategies and had started eating into Wal-Mart's market share.

Although Wal-Mart had the scope to expand in the US, it was becoming difficult for the company to sustain its double digit growth rate. Wal-Mart was suffering from soft sales and rising inventories, especially in its Sam&'s Club divisions.

Wal-Mart also realized that the US population represented only 4% of the world's population and confining itself to the US market would mean missing the opportunity to tap vast markets elsewhere.

In the early 1990s, globalization and liberalization opened up new markets and created opportunities for discount stores such as Wal-Mart across the world...

Wal-Mart's Strategies in China

ENTRY AND EXPANSION STRATEGIES

Wal-Mart began the groundwork for its Chinese operations in 1994 when it sent a team of executives to China.

It started its actual operations in China in August 1996 at Shenzen with the opening of its first Super Centre and Sam's Club in partnership with Shenzhen International Credit Investment Company...

Excerpts Contd... >>


 

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