Essay About Strategic Analysis Of Expansion Of Wal-Mart And Market Value

Strategic Analysis of Expansion of Wal-Mart in Africa
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Strategic Analysis of Expansion of Wal-Mart in AfricaCourse: Business StrategyCourse Code: W650Prepared forMr. Sheikh Morshed JahanAssociate ProfessorPrepared byLamia SalimBatch: 54D, Roll: 57April 11, 2017Institute of Business AdministrationUniversity of Dhaka Wal-MartWal-Mart Store, Inc., doing business as Walmart, is an American multinational retailing corporation that operates as a chain of hypermarkets, discount department stores, and grocery stores. Headquartered in Bentonville, Arkansas, the company was founded by Sam Walton in 1962 and incorporated on October 31, 1969. The company operates under the name Walmart in the United States and Canada. It operates as Walmart de México y Centroamérica in Mexico and Central America, as Asda in the United Kingdom, as the Seiyu Group in Japan, and as Best Price in India. It has wholly owned operations in Argentina, Brazil, and Canada. It also owns and operates the Sams Club retail warehouses. Walmart is the worlds largest company by revenue, according to the Fortune Global 500 list in 2016, as well as the largest private employer in the world with 2.3 million employees. It is a family-owned business, as the company is controlled by the Walton family. Sam Waltons heirs own over 50 percent of Walmart through their holding company, Walton Enterprises, and through their individual holdings. Walmart is also one of the worlds most valuable companies by market value, and is also the largest grocery retailer in the U.S. Part A- Strategic ContextFacts Identified:Presence of WM would lead to huge job losses and adversely affect the domestic manufacturing sector of AfricaWM willing to create 15,000 new jobs in a matter of 3 years. Has a past record of giving low wages and low benefits; discourages employees from forming labor unionsWill WMs low price prove successful in Africa’s low poverty low income country or not?Model of passing discounts retailers get from WS to customers, and selling in bulkOpened Sam’s Club- chain of membership only warehouse clubsJV with Caullum Company- Hypermarket USA. Entered international markets all through JVs (Cifra in Mexico, Woolco in Canada)Does not allow retailers control over merchandiseLimited percentage of merchandise sourced from single supplier to not give them too much power and have greater bargaining powerSavings on Tech+ Logistics+ Supply Chain+ Lower employee costs= Low price for consumersFailures due to fierce local competitions and cultural discrepanciesIn 2006, WM got fined in UK for offering the employees a pay rise if they gave up a collective union agreement. They did sort out the issues later on before it escalated out of control. WM employed the tactic of shutting down the store or department where workers had asserted their desire for collective bargaining, pretending that the step was being taken for economic reasons.One place where Wal-Mart chose not to resist unions was in China, where such organizations have little autonomy and align themselves with the ruling Communist Party.