Walmart Walmart’s internationalisation strategy in India. The

Walmart has grown to become
one of the world’s largest retailer. The organisation first started in The
United States and now operates in Asia as well as Europe. Walmart is currently
expanding its presence in Indian, many decisions need to be considered as every
country has different ways of controlling a business. Many problems will have
to be faced such as cultural differences or the rules and regulations in a
country of operating a business. The purpose of this report is to discuss the challenges of Wal-Mart
and focus on which aspects of the World
Economic Forum’s (WEF) 2017 “Global Risk” assessments might present the most
important considerations for Walmart’s internationalisation strategy in India.

The consumer segment in India is
separated into urban and rural markets, in which attracts businesses across
the world. According to (Indian
Consumer Market, 2017), India has
been viewed as one of the key markets from where the emerge of future growth is
likely to take place by global corporations. Despite the likely of future
growth, Walmart should be aware of external factors such competitors. International
competitors such as Amazon which mostly focuses on e-commerce has reportedly seen
a sales rose of 25% in the United States. To keep up with the fast-changing
market, (Wahba,
2015) pointed out Walmart is currently
investing a delivery subscription service similar to Amazon Prime.

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 Moreover,
domestic competitors, for instance, Future Group is one of the biggest chain of
department stores in India. (Bloomberg, 2016) claims the Future Group
organization expects the growth in the current financial year as a favorable
monsoon boosts agricultural output and rural incomes. (Lapoule, 2010) mentions there were about 300 consumers and 150 retailers
being interviewed on changing shopping habits. Results show that consumers were
looking for convenience in choosing where they shop, followed by the value of
money of the products. To add up, many locals in India were thrilled to
western-style supermarkets opening in their country despite the negativity. According to a study, 53
per cent of those asked approved of large chains, 24 per cent were against and
23 per cent had no opinion.  One of the challenges is that big retailers like Wal-Mart
say that retail provides jobs; but, only for people who meet the requirements
will get employed, not those who work in neighboring stores. Hence, left with some still supporting small
shop owners being against corporate retail (Lapoule, 2010).

Meanwhile, Walmart has a “Low Price Promises”
strategy where the organization provides high quality products at the lowest
price. In addition, (Wal-Mart Stores, Inc. 2017) revealed that Walmart manages
to provide better product information to customers to meet industry standards
through greater online access to ingredient information. (Mourdoukoutas, 2017) discussed Walmart is catching
up with Amazon by improving their on-line retailing. This gives them a
competitive advantage. The (WEF, 2017) did talk about emerging technologies but only focus
on parts such as assessing the risk of
artificial intelligence. This does not have any correlation with Walmart
expanding its presence in India. Technological
advancements might be different in India from other countries. The world
economic forum did not really mention about e-commerce. At Walmart India, blood donation is usually taken place to support the
National Thalassemia Welfare Society. This contributes to children that are
affected by thalassemia- a blood disorder that requires a blood transfusion
almost every day.

 

(Christopherson, 2007) commented that
trade liberalization has been practiced by Wal-Mart. The organization is effective
in practicing supply chain management. In addition, Wal-Mart’s foreign
investments has been known a success due to the organization’s ability to assume a cost leadership position depends on control
of supplier firms in national markets as well as in international supply chains.

Moreover, this should depend on the regulatory control of India as well as the
labor force. According to (Worstall,
2017), the expansion of Wal-Mart in India is still encountering some difficulties due to
the Indian government posting
restrictions on people doing what Walmart does best, piling it high and selling
it cheap. In results, impoverishes the consumers of India. This mean they still
purchase retail through the Mom and Pop retailers which dominate the sector.

Previously, protests from locals on the streets in major
cities like Dehli, Mumbai, Bengaluru and Kolkata on August 7 (2008)
against the Indian supermarket business,
Reliance Fresh which has formed a venture with Marks & Spencer from locals were
not anticipated (Lapoule, 2010). This could be said as a global issue. It is not easy to
achieve growth opportunities as there are often complex rules and local legislation governing
foreign investment. Even the most carefully considered plans can turn out bad.

Moreover, Wal-Mart expanding its presence in India
also means taking considerations of the effects of climate change on human
health and well-being. The recent Paris agreement
on climate change being implemented and being supported by most nation including
India. Therefore, being
sustainable is crucial to the organization and the Indian community. (Wal-Mart Stores, Inc. 2017) mentions
there are renewable energy systems installed at their stores throughout the
world including India. The installations are expected to provide nearly half of
Walmart India’s electricity needs. This means an efficiency of energy and a
reduction of the greenhouse gas emissions which could cause serious health
problems. (WEF, 2017) advised using renewable energy systems allow firms to
likely to be fully “off-grid”. In addition, according to (Richardson et al, 2009),
low income earners in rural areas are the more at risk. The risks include direct stress such as weather disasters
from ecological disturbance (e.g. altered infectious disease patterns).

Indeed, Wal-Mart being one of the largest retailer is
not easy to manage. As the organization must undergo many process to maintain
their position in the market. Understanding and being able to keep up with the
global market can help the organization not to cause any misunderstandings and
troubles.

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