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Walmart Global Strategies and Ethics

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Walmart:
Global Strategies and Ethics

National American University

September 12, 2018


TABLE OF CONTENTS

Title Page………………………………………………………………………        1

Abstract………………………………………………………………………..        3

Introduction……………………………………………………………………        4

Walmart’s History……………………….…………………………………….        5

Walmart’s International Successes and Failures………………………………        7

Current International Strategy        ……………..………………………………….        10

Walmart’s Future Success……………………………………………………..        12

Conclusion……………………………………………………………………..        13

References……………………………………………………………………...        14


Abstract

This paper is going to address some of Walmart’s Global Strategies and Ethical situations they have had to adapt to.  They have adapted by addressing certain cultural changes within their company.  It will also address some of their history and how Walmart started.  They have had some unique challenges since becoming an international corporation.  These set-backs were attributed to the fact that Walmart failed to recognize that not each foreign market is the same and that business need to tailor their strategies to appropriately target each one differently by performing a SWOT analysis.  This paper will detail just a couple of these challenges, and a look at some of their success’s and failures. If Walmart wants to be successful in the international market they must focus on each region and tailor their strategies for each region.


Walmart:
Global Strategies and Ethics

Walmart is one of the most successful and biggest business’s in the United States. From their humble upbringings to the international stage they have faced many challenges.  These challenges can be attributed to their unique business strategy and how they handle certain ethical challenges.  This paper will only address a small percentage of each.  We will look at some of Walmart’s history, to include how they got started, and their founder Sam Walton.  Take a look at some of their successes and failures, to include South Korea, China, Mexico, and Germany.  Discuss one of their major ethical dilemmas that they face.  Finally dive into how one of the largest retailers in the world can become even more successful in the future by looking at their current international strategy.   Let’s get started with looking at some of Walmart’s history that got them started and helped turned them into what they are today.  

 

Walmart’s History

        “Mr. Sam”, as Sam Walton was known believed in leadership through service.  Walmart as we know it today has evolved from Mr. Sam’s goals of great value and great customer service, (Our History, n.d.).  Sam was born in 1918 in Kingfisher, Oklahoma.  He would go on to serve in the military from 1942 to 1945 and then, with his wife Helena, they would move to Newport, Arkansas.  During this time, Sam would open his own variety store gaining his first experience in the retail market, (Our History, n.d.).  Inspired by the early success of his dime store and driven to bring even greater opportunity and value to his customers, Sam opened the first Walmart in 1962 at the age of 44 in Rogers, Arkansas.  This first Walmart made his vision and mantra of “Lower Prices and Great Service” successful.  The success of this store surprised Mr. Sam and some of his competitors.

        Sam's competitors thought his idea that a successful business could be built around offering lower prices and great service would never work. As it turned out, the company's success exceeded even Sam's expectations. The company went public in 1970, and the proceeds financed a steady expansion of the business, (Our History, n.d.).   Sam credited the rapid growth of Walmart not just to the low costs that attracted his customers, but also to his associates. He relied on them to give customers the great shopping experience that would keep them coming back. Sam shared his vision for the company with associates in a way that was nearly unheard of in the industry. He made them partners in the success of the company, and firmly believed that this partnership was what made Walmart great, (Our History, n.d.).  

        As the stores grew, so did Sam's aspirations. In addition to bringing new approaches and technologies to retail, he also experimented with new store formats including Sam's Club and the Walmart Supercenter, and even made the decision to take Walmart into Mexico, (Our History, n.d.).   Sam's fearlessness in offering lower prices and bringing Walmart's value to customers in the U.S. and beyond set a standard for the company that lives on to this day. His strong commitment to service and to the values that help individuals, businesses and the country succeed earned him the Presidential Medal of Freedom, awarded by President George H. W. Bush in 1992, (Our History, n.d.).  During his acceptance speech, he said the following statement which would eventually become the company’s purpose.  Sam stated, “If we work together, we'll lower the cost of living for everyone...we'll give the world an opportunity to see what it's like to save and have a better life”.  By this Motto, later that year, the company would expand on to the international market and try to bring this type of shopping experience to the entire world.  This dream, or vision, however would not come without its successes as well as its failures (Our History. n.d.).         With such a successful start domestically, Sam and Walmart made the move to be just as successful in the international market.  Let’s take a look at some of their international successes and failures.

Walmart International Successes and Failures

        Walmart became an international company in 1991 when it opened a Sam’s Club near Mexico City, Mexico.  Just two years later Walmart International was formed, (Luthans, & Doh. 2015).  Walmart International had some growing pains during its beginnings.  They attempted to use its big-box low-price model, which is what brought the company success domestically, (Luthans, & Doh. 2015).  Even though the company has had some success it has been far from universal.  They have faced some backlash from foreign established retailers.  For example, in Mexico, three of the largest established retailers formed a joint buying and operational alliance for the sole purpose of competing with Walmart, (Luthans, & Doh. 2015).  Walmart has also failed at times to meet regional costumers’ tastes.  They closed approximately 111 stores in South Korea and Germany in 2006 because of this issue, coupled with customers strong loyalties to preexisting brands.  This made attracting new customers extremely difficult, (Luthans, & Doh. 2015).  

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