Walmart in China Case

Walmart in China Case - Executive Brief Introduction...

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Executive Brief Introduction Strategy in the US Cost control Logistics Management Competitive Advantage Customer value Customer Service Benefit to Workers Wal-Mart in China Current Situation Problems CAGE (Cultural, Administrative, Geographic, and Economic) Income Disparity Local Protectionism Infrastructure Regulatory Restrictions Lack of IT Network Consumer Behavior/demands Recommendations Fewer and larger suppliers (also addresses lack of IT network, facilitates transport) Stay near the eastern coast (bigger cities), near highways and main streets Beijing, Wuzi, Jiangsu, Nanjing, Hangzhou, Suzhou, Fujian Centralized management led by Chinese people: Chinese people in upper management (point to Carrefour’s mistake: mini kingdoms and corruption due to store managers’ complete freedom) Make employees happier (employee discounts in the store) Wal-Mart image and reputation Target growing middle class (instead of the lower classes in the US) Cater to more people (because each one cannot buy as much as people in US) Buy up domestic retailers (since every city has its own tastes and the domestic retailers already understand the local nuances) (particularly domestic retailers in prime locations) Increase security to decrease shoplifting CASE STUDY: Wal-Mart in China Wal-Mart Stores: Everyday Low Prices in China Summary: (Taken From Harvard's site)  Although Wal-Mart, the world's largest company by revenue, was into its 9th year of operations in China, its stores were still losing money. It had  created a miracle in the U.S. retail industry by revolutionizing the sector's business model and successfully implementing its model through innovative  practices that enabled it to sell national brands at "Every Day Low Prices". The challenge Wal-Mart faced was whether it could transport its successful  model to win in a market with many differing characteristics which threatened its low-cost structure and which could nullify its competitive advantage.  Concerned with the application of established domestic business models in international expansion. Also sheds light on other globalization issues  such as market entry strategy, localization vs. standardization, the effect of regulation changes on the competitive landscape, and firm performance. 
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Learning Objective: (Taken From Harvard's site)  To address competitive advantage and its sources (differentiation and cost leadership); debate standardization and localization in international  expansion and strategy formation--the fit between firm strategies and external environments; provide students with a basic understanding of the  concept of competitive advantage and its sources through a discussion of Wal-Mart's success in the U.S.; discuss the challenges of replicating a 
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Walmart in China Case - Executive Brief Introduction...

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