An assessment of Wal-Mart's global expansion strategy in the light of its domestic strategy

Abstract

Wal-Mart, the world's largest retailer, has globalized its operations to sell to underserved markets and to gain the earnings growth demanded by its shareholders. Wal-Mart dominates the U.S. market and derives 24% of its sales from 14 international markets. It achieved early success in Mexico, Canada and later in the U.K. It failed with market entries into Germany, South Korea, Hong Kong and Indonesia. Its success in other markets is yet to be decided. Wal-Mart's domestic strategy can be reduced to five factors, many of which are not possible in global markets. Wal-Mart claims that its global policy is one of transporting its domestic strategy factors globally, yet its history shows inconsistencies in achieving this. We assess Wal-Mart's global network and suggest some host nations where Wal-Mart might do well. The key goal of this paper is to highlight the surprising gap between Wal-Mart's domestic and global strategy. © 2009 Gabler Verlag | GWV Fachverlage GmbH, Wiesbaden.