International Marketing Report on Wal-Mart

This report analyzes Wal-Mart's international marketing strategies, including PESTLE analysis, Porter's Five Forces analysis, value chain analysis, mode of entry in India, and marketing mix. It also discusses the reasons for Wal-Mart's success or failure in India.

Running head: Wal-Mart
International Marketing Report

Wal-Mart 1
Table of Contents
Introduction.................................................................................................................................................1
Task 1..........................................................................................................................................................1
Macro analysis – Pestle...........................................................................................................................1
Micro analysis.............................................................................................................................................2
Porter five forces analysis........................................................................................................................2
Task 2..........................................................................................................................................................4
The value chain of Wal Mart...................................................................................................................4
Task 3..........................................................................................................................................................6
Wal-Mart’s reason for success or failure in India........................................................................................6
Task 4..........................................................................................................................................................7
Mode of entry inside India...........................................................................................................................7
Task 5..........................................................................................................................................................8
Marketing Mix for Wal-Mart.......................................................................................................................8
Conclusion...................................................................................................................................................9
REFERENCES..........................................................................................................................................10
Introduction
Wal-Mart is one of the largest grocery chains globally. The company was established in
1962 by Samuel Walton and J.L Walton. In this report, proper analysis will be made of Wal-
Mart.

Wal-Mart 2
Task 1
Macro analysis – Pestle
Political Factor
Political factor plays a great role for the brands like Wal-Mart who are trying to conduct
the activities on an international level. It is seen that the rules and regulations in India are strict
and it is important to consider proper rules and regulations so that entry can be easy for the
company. In India there is high level of stability in politics so it is an opportunity for the
company to enhance the market share and conduct the activities in India. In India there is
political support for globalization and it is seen that it is one of the opportunity for the company
to enhance its market share in a proper manner. It is also seen that India give opportunity to the
foreign investors so that business can be conducted with a local companies. At the timing of
entering into the market it is seen that the company faced many rules and regulations related with
currency and tax system (Joseph, 2015).
It is important for the company to take into consideration proper rules and regulations so
that activities can be conducted smoothly. In India there is high political pressure for higher
wages and it is one of the biggest threats for the company. It is seen there are many taxation
policy like VAT which is important to be considered by the company. There are also many rules
and regulations related to FDI in India.
Economic Factor
In the Retail industry sector there are various factors that give direct impact on the overall
performance of the Wal-Mart. It is seen that in India the economic downturns are seen and also
the currency exchange will give direct impact on the performance. In India, the company is
facing issues related to unemployment and also inflation rate. These factors give direct impact
on the overall profitability and growth of the company. It is seen that the company has invested a
lot in 2008 on lobbying to increase the market access for investment (Selmi and Tsakos, 2015).
Social factor
There are various challenges that are faced by the company like people of India prefer to
buy fresh vegetables and grocers as compared purchasing from supermarkets. In India, it is seen

Wal-Mart 3
that due to a shortage of the resources standing in a queue is one of the major disadvantages for
the company. It is seen that Indian firms are more hierarchical if a comparison is made with the
western companies. (Dholakia et al., 2017).
Technological factor
To be competitive in India, the company should focus on considering latest technologies
so that growth can be achieved. The company should focus on promoting digital means of
business through introducing the applications in the market. It is seen that company also
conducts the activities through applications. So it is important to promote the application system
in India so that growth can be achieved effectively.
Environmental factor
The company should also focus on giving paper bags so that environment can be secured
in a proper manner. In India, the ban is also imposed on the usage of plastics so the company
should emphasize to use paper pages.
Legal Factor
It is important for the company to consider the Wages act so that activities can be
conducted properly and effectively. In India, the company has the opportunity to consider food
safety regulations so that the satisfaction level of the customers can be enhanced.
Micro analysis
Porter five forces analysis
The bargaining power of the buyer
It is seen that the company has less power in the retail sector. The company has to face
pressure because of many suppliers in the industry. Also, it is seen that a large number of buyers
have a strong force on the company and also weak force is seen on the individuals who purchase
the product in a small quantity.
Bargaining power of suppliers

Wal-Mart 4
In the retail sector, it is seen that there is less power on the bargaining power of the
suppliers. The products can be supplied easily by many suppliers. The big companies like Wal
Mart can easily give impact on the suppliers.
The intensity of competitive rivalry
In the retail sector, the rivalry is strong. There are large numbers of companies in the
retail sector and also it is seen that company can remain aggressive so that competitive advantage
can be achieved.
Threat of substitution
In the retail sector, the threat of substitution is weak as it is not possible for every
business to conduct the activities on large scale. It is also seen that many substitutes are costly if
a comparison is made with the low-cost goods offered by Wal Mart (Hwang and Park, 2015).
The threat of new entrants
The company has to face high risk from the new entry of the companies. It is seen that to
develop new brand can be a costly process. It is also seen that new entrants can become a threat
to the big companies like Wal Mart (Matusitz, 2015).

Wal-Mart 5
Task 2
The value chain of Wal Mart
(Source: human resource, 2018).
Primary activities
Inbound logistics
It is seen that company focuses on purchasing the products in bulk from the suppliers so
that prices can be managed. The company emphasizes on proper supply chain management and
inventory management so that supply chain cost can be managed (Laszlo and Cescau, 2017).
Operations

Wal-Mart 6
The company conducts the activities in more than 28 countries and it has more than
11500 retail units globally. The company takes into consideration the technique of inventory
management which is cross docking.
Marketing and sales
The tagline of the company is "SAVE MONEY AND LIVE BETTER". The company
offers low-cost products which have given impact on the image of the company. The company
gives advertisements on social media and through banners (Priyanka and Srinivasan, 2015).
Support activities
Technology
The company takes into consideration extensive use of technology as it has good supply
chain and customer service. The company also introduces smartphone applications which
enhance the sales (Waller et al., 2015).
Human resource management
The company has many problems with the poor human resource practices. Wage policy is
one of the issues and it is seen that company has given good ages to promote the people.
Procurement
The company focuses on procurement. It is seen that the company have managed good
relationships with its suppliers so that cost can be less. The suppliers offer good products to the
company.
Firm infrastructure
Wal Mart has a good infrastructure that takes into consideration management, human
resources, and overall supply chain. Also, it is seen that company manages the employees in a
proper manner.

Wal-Mart 7
Task 3
Wal-Mart’s reason for success or failure in India
In the starting phase of its entry to the India Wal-Mart has a great expectation due to its
diversified and such a large population (Matusitz and Reyers, 2010). In the later stage of its
establishment it was noted that company has failed significantly in its business. It was due to
various reasons that existed in the market of India. By watching India's growth rate company has
announced to open around hundreds of stores inside the nation. This had proved to be wrong in
the longer run. Some of the reasons that resulted in its failure in India are:
a.) Low per capita Income: India is a nation where the income of the people is slightly on the
lower side. This is true that people within the company do not prefer to go into the big
supermarkets for purchasing the grocery products (Trebbin, 2014).
b.) Limitation on FDI: The government policies regarding the foreign direct Investment have
restricted the Wal-Mart to enhance their share in the Indian Market. The foreign
companies like Wal-Mart can only have a share of around 51 %.
c.) Local stores: Bigger supermarkets like Best Price are facing competition from the local
grocery store. These local grocery stores sell around 98 % of the total requirement of the
nation (Kamboj and Kalia, 2011). With so many in-house supermarket chains, the
remaining 2% cannot account for the profitable business.
d.) Higher investment on lobbying: This Company in its report have said that for expanding
its market in India they had to invest a lot in the lobbying. This huge amount could have
been used in some other changes within the organization. Even after that, a slow
bureaucratic process has restricted its penetration in the Indian market.
e.) Different cultures of the market: It is seen that people within the nation have a very
different kind of thinking as compared to that of western market. People do not want to
wait in the queue. Providing the people with such kind of facilities needs a very large
store which requires a huge amount of capital.
f.) There are many things that can be learned from the Wal-Mart’s future business strategy.
Some of them are:

Wal-Mart 8
g.) Even after the company is facing loss they are trying hard to increase its reach in the
longer market. This will help in creating a brand name in the market which is necessary
for the growth of the future.
h.) The new investment plan of the company is very riskier still it teaches that taking risk is
the emerging markets can be beneficial.
Its future strategy of diversification teaches the by adding a number of products in the
portfolio company can easily expand their reach in the market. Wal-Mart is planning on adding
non-food items in its stores. This is due to the fact that non-food products have higher profit
margins as compared to that of food products.
Task 4
Mode of entry inside India
This company has chosen to enter the market of India with the help of Partnership. This
is an equity mode of entry where the company had a joint venture with the Conglomerate
Company Bharti. In this Joint Venture, Wal-Mart has the share of 51 % (Cohen, 2013). This
mode of entry helped them in reaching to the local suppliers as the government of India has
restricted the firm that they have to take a major part of their products from the local suppliers.
This was also due to the fact that there are many 100% FDI in the retail market is not permitted
in India (Shah and Pore, 2014). This has forced the companies to choose this entry mode in
India.
The suggested mode of entry for this company would have been licensing. This kind of
licensing strategy could have helped the company in making least amount of investment. In the
country like India where the larger part of the grocery market is controlled by Kirana stores. In
the licensing strategy, the products that are sold by licenser in their host country can be sold by
the licensee in the market where the company wants to entry. The franchiser company can train
the employees; provide technology that will help them in making their operations smoother. As
an alternative, this can be an option for the company to enter the market of India. This will also
be supported by the government of India as the total purchase of the raw materials will be from
the country itself. This will reduce the cost of the operations of the company as they will not

Wal-Mart 9
have to invest a huge amount of money in lobbying which has been a serious challenge for the
company in the past (Haiven, 2013).
Task 5
Marketing Mix for Wal-Mart
Wal-Mart is a bigger brand and hence they have to properly apply their marketing mix.
This will help the company in reaching the larger part of the market and achieve the strategies
they have made for themselves (Kapoor, 2014). The company needs to apply the marketing mix
according to the internal and external environment it is facing.
a.) Product: This Company offers a large variety of the food product items (Bose, 2012).
This includes packaged foods, groceries and daily etc. Since the Indian society is highly
dependent on the Kirana stores hence the company needs to add some more non-food
product Item which has a higher margin of profits.
b.) Price: In the food products items there is a little margin and in the increasing price war
between the competitors Wal-Mart cannot increase their food product items. People in
India gets attracted towards the stores that are serving items ta lower cost (Foster, 2014).
The local players in the industry have managed to do it very successfully. Since in India
there is low-cost supplier hence company can easily gain profits even after the low
pricing of products.
c.) Place: This Company can enhance the number of cash and carry stores that will help
them in selling the products to the other whole seller. In order to enhance their direct sale,
the company can open some of the stores that are smaller in size and the Walmart stores
have been known for being large in the size. This will help in facing the economic
challenges that company is facing while operating in India.
d.) Promotion: This Company is operating with a name called Best Price. It is necessary that
for promotional purpose company can use its own brand name. This will help Wal-Mart
in increasing the market base inside the country. Right now this company has not an
investment a lot in the advertisements which have resulted in low brand awareness in the
name Best Price.

Wal-Mart 10
e.) People: There is easy availability of the low-cost laborers in India (Bhandari, 2017). The
company can train them so as to meet the standards that they have in other nations. This
will also help the company in facing the political challenges like the changing
employment laws.
f.) Process: This Company is known for its best quality management and use of most
advanced technology in their operations. The company needs to add the number of local
suppliers in its portfolio that will help them in availing resources at lower rates.
g.) Physical evidence: Wal-Mart serves best of the products to its clients. Their products are
real and tangible. It is up to mark as they have promised to their clients. This is necessary
for the growth of the firm as it helps in increasing the brand name inside the nation and
assist in retaining old consumers (Prabhakar and Raj, 2013).
Conclusion
So, by evaluating the report it is seen that company should focus on proper marketing in
India so that goals and objectives can be accomplished effectively. Also, proper management
will help to enhance the market share in an effective manner.

Wal-Mart 11
REFERENCES
Bhandari, N.C., (2017) Walmart-bharti joint venture: formation, breakup, & strategies. Academy
of Strategic Management Journal, 16(1).
Bose, T.K., (2012) Advantages and Disadvantages of FDI in China and India. International
Business Research, 5(5), p.164.
Cohen, A.J., (2013) Supermarkets in India: Struggles over the organization of agricultural
markets and food supply chains. U. Miami L. Rev., 68, p.19.
Dholakia, R.R., Dholakia, N. and Chattopadhyay, A., 2017. Indigenous marketing practices and
theories in emerging economies: Consumer behavior and retail transformations in India. Journal
of Business Research.
Foster, A., (2014) Multinational firms in India: Conducting ethical business (Doctoral
dissertation).
Gopalakrishna, P., Subramanian, R. and Fleischmann, D., (2016) Walmart in India. Journal of
the International Academy for Case Studies, 22(3), p.99.
Haiven, M., 2013. Walmart, Financialization, and the Cultural Politics of Securitization. Cultural
Politics, 9(3), pp.239-262.
Hwang, M. and Park, S., 2015. The Impact of Walmart Supercenter Conversion on Consumer
Shopping Behavior. Management Science, 62(3), pp.817-828.
Joseph, L., 2015. A Geographic Perspective on the Walmart Neighborhood Market. Papers in
Applied Geography, 1(4), pp.348-355.

Wal-Mart 12
Kamboj, R. and Kalia, S., (2011) July. Walmart-India vs. China. In PRIMA (Vol. 2, No. 1, p.
19). Publishing India Group.
Kapoor, M., (2014) Redefining progress and ushering in the fourth revolution. Procedia-Social
and Behavioral Sciences, 133, pp.203-210.
Laszlo, C. and Cescau, P., 2017. Sustainable value: How the world's leading companies are
doing well by doing good. Routledge.
Matusitz, J. and Reyers, A., (2010) A Behemoth in India: Walmart and globalization. South Asia
Research, 30(3), pp.233-252.
Matusitz, J., 2015. Bharti-Wal-Mart: A Glocalization Experience. Journal of Asian and African
Studies, 50(1), pp.83-95.
Prabhakar, R. and Raj, S., 2013. A study of food retailing system in india: a conceptual study.
International Journal of Retailing & Rural Business Perspectives, 2(3), p.520.
Priyanka, P.V. and Srinivasan, P., 2015. From a plan to generating revenue: how is social media
strategy used to generate business in the retail industry in India?. International Journal of
Marketing and Technology, 5(4), pp.62-74.
Selmi, M. and Tsakos, S., 2015. Employment Discrimination Class Actions After Wal-Mart v.
Dukes. Akron L. Rev., 48, p.803.
Shah, G. and Pore, A., (2014) Is Walmart Good for India? A Humanistic Perspective on Opening
Up FDI in Multi-Brand Retail in India. In Humanistic Perspectives on International Business
and Management (pp. 165-178). Palgrave Macmillan, London.
Trebbin, A., (2014) Linking small farmers to modern retail through producer organizations–
Experiences with producer companies in India. Food policy, 45, pp.35-44.
Waller, M.A., Fawcett, S.E. and Johnson, J.L., 2015. The Luxury Paradox: How Systems
Thinking and Supply Chain Collaboration Can Bring Sustainability Into Mainstream
Practice. Journal of Business Logistics, 36(4), pp.303-305.

Wal-Mart 13