Wal-Mart's Failure in Germany: Lessons Learnt for International Business Expansion

INTERNATIONAL BUSINESS –
887313

Table of Contents
Introduction.......................................................................................................................3
Case Background – Wal-Mart’s Entry into Germany....................................................................3
Challenges to International Business Expansion.................................................................3
Walmart’s Failure in Germany...........................................................................................5
Lessons Learnt from Wal-Mart’s Failure in Germany..........................................................7
Bibliography......................................................................................................................9

Introduction
International business expansion has become a top priority for business organizations in the
present-day world. Expanding business operations in multiple countries provides a number of
advantages to companies, such as increased access to different resources, decreased
operational costs, availability of professional employees at lesser wages, economies of scale,
a larger pool of customers, etc. because of which, a lot of organizations have started
expanding their business overseas (Hill, 2008).
Case Background – Wal-Mart’s Entry into Germany
International business may sound too good for companies but it can prove to be detrimental
for some companies that do not do their homework properly and are not prepared well
enough to enter into foreign markets. One such company is Wal-Mart, which operates in the
retail sector and is one of the largest multinational companies in the world. Wal-Mart
operates in 27 countries under 55 different names and has around 11,277 stores in total (Wal-
Mart, 2018). Even after such great figures and experience of foreign markets, Wal-Mart
failed miserably while trying to establish itself in the German market. Therefore, this report
has been prepared to get a deeper insight into the issues that lead to the failure of Wal-Mart’s
expansion strategy in the German market.
Challenges to International Business Expansion
Before discussing the reasons that lead to the failure of Wal-Mart in Germany, it is important
to discuss some challenges that business organizations face while trying to expand their
business operations in new foreign markets. Some of these challenges are discussed below: