Organisations in Global Economy

This report provides insights into the concept of establishing an enterprise in a new country or expanding the business in the same location. It focuses on the background information of Walmart, including its size, legal form, ownership, and current international operations. The report also explores the use of PESTLE and Porter's five forces analysis in analyzing the business environment, with a specific focus on Greece. It concludes with recommendations for Walmart to establish its business successfully.

Business
Organisations in
Global Economy

Table of Contents
INTRODUCTION...........................................................................................................................1
BACKGROUND INFORMATION OF WALMART.....................................................................1
Size, legal form or ownership and current international operations of Walmart.........................1
BACKGROUND INFORMATION OF BUSINESS ENVIRONMENT........................................2
Use of PESTLE analysis..............................................................................................................2
Use of Porter's five forces analysis'.............................................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Business organisations in global economy is the concept of establishing an enterprise in a
new country or expanding the business in same location. With the help of it growth in future
could be acquired by companies (Ahmed and Underwood, 2016). This report is based upon
Walmart which is a multinational retailer and operating business in various countries around the
world. It was founded in year 1962 by Sam Walton and incorporated in year 1969. The
organisation have identified the FDI opportunity of establishing business in Greece. This
company is selected for the report because it is one of the largest and famous entity executing
business in various countries. This assignment covers various topics which includes background
information of enterprise and the country in which the company will be established. For the
purpose of analysing the external environment of Greece PESTLE analysis is used in this
project.
BACKGROUND INFORMATION OF WALMART
Size, legal form or ownership and current international operations of Walmart
Walmart is operating business at global level and it is one of the famous multinational
retail corporation which is headquartered in Bentonville, Arkansas. The founder of it is Sal
Walton who founded it in year 1962 and it was incorporated in 1969. It operates in discount
department, grocery stores and hypermarkets. Currently it is having more than 11400 stores
around the world. Chairman of the company is Greg Penner and president of it is Doug
McMillon. There are various subsidiaries of it which are Sam.s Club, Walmart Canada and
Flipkart.
Size of Walmart: Size of the organisation is very big as it operates in global level and
serve to many countries. It also provides range of products and services to its customers for the
purpose of meeting their satisfaction level. These are footwear, toys, health and beauty,
jewellery, movies and music, craft supplies, grocery etc. and its services are pick up today,
financial services, Walmart Pay etc. Annual revenues of it for year 2019 are more than 500
billion dollars. It is owned by Walton Family and it is operating business with the help of more
than 2.2 million employees. It shows that financial position of the company is very good which is
justifying its size (Overview of Walmart, 2019).
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Legal form or ownership of organisation: Walmart is a publicly traded company which
is owned by Walton family. The founder is holding 50% of its shares and rest of the shares are
kept by other owners of the enterprise. All the operational activities of it are controlled and
monitored by governmental bodies as it is a public entity.
The organisation is operating different types of international operations. All of them are
described below:
Marketing operations: In order to execute business in all the countries it is very
important for the organisation to market it self at international level therefore it is one of the key
operation of it. Walmart is paying attention towards it so that all the products and services which
are sold by it to the customers could be marketed. Main purpose of this operations is to make
sure that a positive image of the company is established in the mind of clients so that sales could
be increased (Burke, 2017).
Human resource operations: These operations are related to recruitment, selection and
hiring of individuals from different locations so that all the operational activities could be
executed systematically. Walmart pay attention towards all the functions of it so that skilled,
knowledgeable and experiences staff could be retained for a long period with the company.
Retail and sales operations: These are the main operations of Walmart because it is
operating business in retail sector and offering different types of products and services. The
managers perform it with the help of rest of the operations because goal of them is to enhance
sales for the company. Focusing upon it may result in higher revenues and profits for long term
in future.
All the above described operations are performed by the organisation for the purpose of
running the business in systematic manner. It helps the mangers to make sure that the company
will be able to reach the long term goals or not (Dimitri, Geoghegan and Rogus, 2017).
BACKGROUND INFORMATION OF BUSINESS ENVIRONMENT
Use of PESTLE analysis
For all the entities it is very important to make sure that business environment in which
operational activities are performed is analysed as it can help to determine the factors that may
result in negative impacts upon efficiency of the company. As Walmart is planning to establish it
self in Greece therefore it is very important for it to make sure that all the forces which may
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leave impact upon its operations are analysed properly or not. For this purpose, the management
may take PESTLE analysis in consideration. It is a combination of six different elements which
may help to analyse the actual situation of the country. All of them are political, economic,
social, technological, environmental and legal (Eisenstein, 2017). By focusing upon all of them
Walmart will be able to establish it self in Greece successfully. Description of all of then in
context of the organisation and country is as follows:
Political: There are various components of this element which are stability of political
parties, changes in legislation, influences at global level etc. Due to all of them a business may
get affected and face issues such as interferences of political parties in operations. Greece is a
democratic republic in which prime minister is the head of government who passes guidance to
all the organisations operating business in it. As the political system of the country follows
democracy therefore it will be a great opportunity to establish its business in Greece because the
influence of political parties will be very low due to this situation (Political conditions in Greece,
2019).
Economic: The components of this factor includes employment or unemployment rate,
economic growth, inflation, deflation, exchange rates, monetary policy etc. For Walmart it will
be very important to make sure that all of them are analysed in detail in context of Greece before
taking the decision of establishing the business there. The main factor which should be focused
by the enterprise is unemployment rate and it cold be analysed with the help of following chart:
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(Source: Unemployment rate in Greece, 2019)
From the above graph it has been analysed that the unemployment rate in Greece is
decreasing continuously due to governmental policies. It has also been identified that as the rate
is very high because more than 16% of individuals are unemployed in the country
(Unemployment rate in Greece, 2019). By paying attention towards this element Walmart can
establish its business and provide jobs to the individuals in Greece. With the help of it
governmental support could also be taken for establishment. Growth of economy of the country
is good because in year 2018 it was increased by 0.4% as compared to last year in which it was
1.5%. It shows that the country is growing slowly but attaining growth so it will be beneficial for
Walmart to establish its business there.
Social: The elements such as demographic influences, lifestyle factors and income
distribution are considered as social factors which should be focused by organisations for the
purpose of meeting requirements, needs and wants of customers in targeted segment. In earlier
years the society of Greece was dominated by male members of family but with the changes in
time it was also modified and now men and women manage family collaboratively. While
establishing business in the country it will be very important for Walmart to make sure that the
marketing activities with the tag lines are formed according to this culture. It can help to attract
large number of customers (Social factors of Greece, 2019).
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Illustration 1: Unemployment rate in Greece, 2019

Technological: Changes in information technology, international influences, innovation
etc. are technological factors which should be focused by business entities to execute business
systematically. In Greece most of the business entities are using digital technologies and
accelerators for business execution as it helps to retain the customers for long period and achieve
competitive advantage in the industry. For Walmart it will be very important to make sure that it
uses digital technology to market all its products and services so that large number of clients may
get aware of them. By focusing upon it the company will be able to establish the business in the
nation successfully (Hatzopoulos, Kambouri and Huws, 2014).
Environmental: Acts for protection of environment, climate and weather change,
restrictions for businesses, corporate social responsibility, unethical manner of execution etc. are
components of this factor. Greece is highly focused for the environment and for this purpose eco
design products are promoted within the nation. In earlier years there were no rules and
regulations for the protection of surrounding but the government have formulated effective
strategies to deal with it. The management of Walmart will be required to make sure that all the
acts and restrictions of Greece are complied properly as ignorance of them may result in issues
for establishing business there.
Legal: Employment laws, health and safety acts, taxation policies etc. are legal factors of
PESTLE which are required to be incorporated in organisational policies as it is required to
operate business in a country. In order to establish the business in Greece successfully it will be
very important for Walmart to make sure that it is complying with all the provisions of Greek
Company Law as it is required to operate there. If the organisation is not able to do the same then
it may result in legal interferences in the operations.
While analysing the external business environment the managers of Walmart are
suggested to conduct a market research which will help to gather detailed information about all
the above described elements. By assessing all of them the management will be able to formulate
such strategies which will help to respond all the challenges which may take place to negative
influence of all the above described forces (Kingah, 2014).
Use of Porter's five forces analysis'
While analysing business environment it is very important for an organisation to
determine the competitive environment also as it will help to formulate effective strategies for
future. As Walmart is going to establish its business in Greece so it is very important for it to
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analyse the competition in the retail industry of the country. The managers can use Porter's Five
forces analysis for the same purpose. This model was introduced by Michale Porter for the
purpose of directing organisations to analyse competition for business. There are five main
components of it which are as follows:
Competitive rivalry: It is one of the main element of the model which could be used by
Walmart for the purpose of analysing the existing competition in the retail industry of Greece.
The major competitors for the company are AB, Lidl, Aldi, Carrefour, Galaxias, Masoutism Dia
etc. In order to establish business successfully it is very important for the organisation to adopt
unique strategy to sustain in the market. It shows that the level of competition in for the
enterprise is very high (Marques, 2019).
Threat of substitute: When such products are available in the market which are
providing same benefits to the customers then these are known as substitutes. For all the
companies such as Walmart it is very important to make sure that they gather information about
all the seller who are selling substitutes for their items. There are various local sellers in Greece
who are offering such items to the customers which are available in the stores of Walmart. In
order to establish the business successfully it is very important for the company to gather
detailed information about them and then decide prices for its items. According to these facts the
threat of substitutes for Walmart is moderate (Sheppard, 2015).
Threat of new entrant: All the industries which are generating profits attract new sellers
as they want to acquire higher profits. The retail industry is very big and to enter in this market it
is very important for companies to acquire funding for operations. There are various barriers for
new entrants in retail sector therefore the threat of them for Walmart is very low. It shows that
the company will be able to establish itself successfully.
Bargaining power of suppliers: All the individuals who are supplying goods to the
companies so that they can operate business successfully are known as suppliers. In Greece the
number of external parties for supplying items is very high and if one of them is selling products
at higher price then the enterprises can buy them from others. Walmart will also have huge
number of suppliers and the bargaining power of them for the entity will be very low due to
higher their availability of them in the market (Richardson, 2017).
Bargaining power of customers: Buyers are considered as the king of market and for all
the organisations it is very important to set such prices for all its products which could be
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adopted by them. The level of competition in retail industry is very high for Walmart therefore
the clients will have multiple choices to buy goods. It shows that their bargaining power in this
situation is high. In order to deal with it the management of Walmart will be required to keep
good quality items at stable price in the stores of it (Usui, 2016).
In order to acquire a competitive position in Greece all the above described elements are
required to be analysed by Walmart as it will be beneficial for managers to formulate effect8ive
strategics for future. All the decision which will be formed for establishing the business should
be based upon all these components.
CONCLUSION
From the above project report it has been concluded that there are various organisations
which are planning to establish themselves in multiple countries for the purpose of capturing
larger market share and increasing number of customers. If an organisation plans to establish its
business in a new location then it is very important for it to make sure that it analyse the business
environment of the country in which the expansion will be done. For this purpose, PESTLE
analysis could be used which helps to analyse political, economic, social, technological, legal
and environmental in the context of the nation. Apart from this porter's five force analysis could
be done for determine the forces which may affect competitive advantage.
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REFERENCES
Books and Journals:
Ahmed, W. and Underwood, R., 2016. Corporations and Multilateral
Organizations. International Encyclopedia of Geography: People, the Earth,
Environment and Technology: People, the Earth, Environment and Technology. pp.1-
10.
Burke, R. A., 2017. Counter-terrorism for emergency responders. CRC Press.
Dimitri, C., Geoghegan, J. and Rogus, S., 2017. Two-stage determinants of the organic food
retailing landscape: The case of Manhattan, New York. Journal of Food Products
Marketing. 23(2). pp.221-238.
Eisenstein, H., 2017. Hegemonic feminism, neoliberalism and
womenomics:'empowerment'instead of liberation?. New Formations. 91(91). pp.35-49.
Hatzopoulos, P., Kambouri, N. and Huws, U., 2014. The containment of labour in accelerated
global supply chains: The case of Piraeus port. work organisation, labour and
globalisation. 8(1). pp.5-21.
Kingah, S. S., 2014. Regional Strategies to Mitigate Unemployment in the Wake of Crises:
Comparing the EU in Greece and MERCOSUR in Paraguay. CETLS Online Paper
Series. 3.
Marques, J., 2019. Right Effort. In Lead with Heart in Mind(pp. 107-120). Copernicus, Cham.
Richardson, D., 2017. International Encyclopedia of Geography. 15 Volume Set: People, the
Earth, Environment and Technology (Vol. 1). John Wiley & Sons.
Sheppard, B., 2015. Hillary's real record far from progressive. Green Left Weekly. (1051). p.14.
Usui, K., 2016. Japanese Retailing. Haghirian, P.(Hg.): Routledge handbook of Japanese
business and management. London: Routledge, pp.284-296.
Online
Overview of Walmart. 2019. [Online]. Available through:
<https://walmart.org/>
Political conditions in Greece. 2019. [Online]. Available through:
<https://santandertrade.com/en/portal/analyse-markets/greece/economic-political-
outline>
Unemployment rate in Greece. 2019. [Online]. Available through:
<https://tradingeconomics.com/greece/unemployment-rate>
Social factors of Greece. 2019. [Online]. Available through:
<https://www.ancient.eu/article/483/ancient-greek-society/>
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