Reasons for Failure of Walmart in Japan

This paper critically analyses the problems experienced by Walmart in Japan and the reasons for its failure. It fills the gap in research on the topic and provides valuable information for future researchers. The study explores cultural differences, diversity management, demography, and technology in relation to Walmart's failure in Japan.

Reasons of failure of Walmart
Professor name
Word count

Contents
Section 1 Business research.......................................................................................................3
Section 2 Literature review..........................................................................................................3
Section 2.1 primary research proposal.....................................................................................4
Section 2.2 Research objectives..............................................................................................6
Section 2.3 Research questions...............................................................................................7
Section 2.4 The list of information............................................................................................7
Section 2.5 Quality assessment.............................................................................................10
Section 3 Research methodology..............................................................................................12
Section 3.1 research approach and technique.......................................................................12
Section 3.2 population analysis..............................................................................................13
Section 3.3 sample designing................................................................................................14
Section 3.4 implementation plan............................................................................................15
Section 3.5 Suggested questions :.........................................................................................15
Section 3.6project schedule...................................................................................................17
References................................................................................................................................ 18

Section 1 Business research
The business organization considered in this paper namely Walmart is the largest
company in the retail sector. It is operational in various countries of the world (about 28) and
firmly established in the market of the USA. It is present in many corners of the world by
different names (Mattera, 2017). like the best price in India and Seiyu in Japan. It was founded in
1962 by sam Wilton. It has more than 10000 stores worldwide and supplies different kinds of
products to different populations of the various countries of the world. It recently entered the
market of Japan but it is not able to replicate its successful achievements in Japan as it did in the
USA and other developed countries.
This paper critically analyses the problems experienced by the company in Japan and the
reason for its failure in a particular country (Bonanno & Goetz, 2012). There are many research
projects available regarding the strategy and consequent success of Walmart in different parts of
the world. But there is a wide gap when the studies regarding the policy of Walmart in Japan are
concerned. The failure of Walmart is not well studied in any research conducted in the past. This
paper aims to fill this gap and present different reasons for the failure of Walmart in Japan. Such
a big corporate giant, having firm roots in the market of the USA gets failed in Japan. So it needs
a thorough research. this paper critically analyses the situation of the company in Japan and the
problems encountered by it while doing business in the market of Japan (Nassauer, 2018).
Section 2 Literature review
According to Fortune Global 500, Walmart is the largest company with over 2.3 million
employees and a revenue of over $ 500 billion in 2018. It has a worldwide presence and entered
into the market of Japan in 2002 with purchase of 6% stake in the company named as seiyu. Sam

Walton owns about 50% of the shares through holding company as well as individual holding
(Huang, 2012). The company is a big name in retail segments and has a brand image in the
countries where it operates. The company is given strong competition by other companies
working in the same segment. The toughest competition is given by the Amazon. Amazon is an
online store and doing best in the market so there are possibilities to consider and imitate the
policy of Amazon.
Section 2.1 primary research proposal
As mentioned above, there is a wide gap related to the failure of Walmart in Japan in the
context of studies and researches (Tupper, 2018). This paper aims to fill that gap. There are
different reasons for its failure which will be described in details in next sections (Lecavalier,
2010). The study aims to provide useful information for the scholars interested in Walmart. It
sheds valuable insight on the topic of failure of Walmart in Japan. The qualitative research is
used for the purpose whose exact reason is explained in latter part of the paper. This research
proposal will make Walmart to consider its policy and do a conclusive research taking the
valuable data from this study. The facts highlighted in the study can influence the decision
making process of Walmart. There are many other applications of a well researched document so
it can be used for various other purposes by the company.
Situation analysis
a) The globalization has increased the demands of the customers so there is the wide range of
expectations of the customers. At the same time, the competition is getting increased due to the
wide reach technology adopted in the 21st century (Robles, 2018). There is a number of

companies which have been operating as multinationals. These companies are giving tough
competition to each other as different kinds of products are available to the customers within a
short period of time (Kestenbaum, 2017). Walmart is not aloof from these developments; it also
has repercussions due to increased competition. There are many corporate giants which are
giving tough competition to Walmart (Lord, 2018).
b) Walmart is facing the problems of delay in a stocking. Shelves are not stocking the products
fast enough so there is no efficiency in the working of the organization. There is a number of
competitors who are ready to gain the market space created by Walmart (Meyers, 2014). The
delay in stocking inadvertently leads to increased operational cost and delay in delivering the
products to the end consumer (staff, 2018)
c) There is no digital transformation of the company (Halzack, 2018). The stores are not
connected digitally which is leading to higher operational cost and loss of competitive advantage
to the business organizations which have embraced the digital transformation (Wolfe & Pyrooz,
2014). There is a wide gap in terms of digital connectivity (Mejia, 2018). The company is not
able to change its business as usual culture and not able to convince employees and vendor to
implement and accept the change.
d) ACSI (American customer satisfaction index) dropped from 72 to 71 in the year 2018. This
suggests that the company is losing space to its competitors and not able to satisfy the customers
of the USA itself. Though Walmart expanded its services to in-store groceries; it has not been
able to satisfy the customers (Wylie, 2018).
e) The company is mired in the controversy of racial and gender discrimination. The data of the
previous few years revealed that the company has very less number of women employees in the
organization (Moberg, 2011). Along with this, the women at higher positions of authority are not

adequate in number so there are allegations of gender discrimination. There has been an issue of
racial discrimination as well (Wylie, 2018). The company is not able to embrace diversity and
there are many cases of racial discrimination. These controversies are denting the image of the
company (Scott, 2015).
f) The ethical codes of Walmart create frustration, instead of improving the work culture.
There are many cases of frustration due to ethical codes which are resulting in dissatisfaction of
employees (Basnet, 2018)
g) Only service dogs are allowed in the store. It has dented the image and affected the work
culture of the organization leadership is not working effectively to recruit talent in the
organization.
h) There are cultural issues as well. There are different cultures in different countries. The
culture of America does not bode well to Australians (Provost, 2016).
Section 2.2 Research objectives
The objectives of the study are as follows:
a) To provide valuable information for future researchers on the topic
b) To fill the gap related to effective studies on the topic
c) To identify the reasons for the failure of Walmart in Japan
d) To analyze the population (demography) of Japan

Section 2.3 Research questions
There are different questions which would be answered through this research. These questions
are as follows:
a) What are the factors that influence the choice of grocery shopping among the Japanese?
b) What are the changes in buying pattern of America and Asia?
c) What kind of cross culture grocery buying behavior is there in Japan?
d) How far the Japanese customers can travel to make the purchase?
e) What method the do customers prefer for purchase- online or in-store?
f) What features are considered by the customers while purchasing the products?
Section 2.4 The list of information
There are various reasons for the failure of Walmart in Japan which are listed as follows:
a) Demand and supply lags
lifestyle of Japanese is different from the lifestyle followed by the citizens of America.
Japanese population prefers fresh food with perfection rather than a value approach. The
Japanese people buy in small quantities as compared to the culture of stocking in the USA. In
addition to this, the Japanese people prefer fresh food rather than packaged one. The Walmart is
not able to meet the demands of customers of Japan (Little, 2018). The supply of products is not
according to the preference of people. This demand and supply gap has cost dear to Walmart in
terms of market space. The exact scenario of this demand and supply lag is ascertained by the
study. This gap addresses the concerns of Walmart regarding cultural changes in Japan and other
Asian countries. There are significant gap in previous studies which is fulfilled by this paper. But
still, some gap exists which can be filled by the conclusive study done on the same information.

b) No emotional connectivity
Emotional connectivity is essential for business organizations to sustain themselves in the
market. One example of emotional connectivity is dairy milk in India which campaigns in the
Indian market with the advertisement of “ shubh Aarambh”. This relates to the culture of the
country (Hirsch, 2018). This paper aims to find out the emotional connection of Walmart with
Japanese citizens. Emotional sentiments can be harnessed for the purpose of awareness regarding
the organization among the mass population. There are many useful methods available to do the
same which need not be detailed here. These methods will yield the intended results as these will
be related to emotional sentiments (the cultural beliefs are attached with emotions). There will be
better targeting of the market, which will lead to better sales and revenue.
c) Cultural research
This paper aims to find out the differences in culture of two different countries and how
the Japanese are culturally affected? Japanese have a culture to buy less but fresh. The packaged
products available with Walmart have not fascinated the Japanese customers to buy products
from it. The cultural implications and complex nature of society are the facts worthy to be
considered by every organization. The Walmart has shown exemplary performance but it is not
able t replicate same performance in Asian markets in general and Japan in particular. The one
main reason for this is the cultural difference. Take the example of the USA and china. In the
USA, sole motive of running a profit based organization is to make money so they hire few
persons who are highly skilled. But in China, the strategy is different, in China lot many persons

are hired at the low wages. These kind of difference in culture and business values can be seen in
different parts of the world.,
d) Diversity management
The issue of diversity management is explored by the study. The company faces
allegations of gender and racial bias, as mentioned above (Hamstra, 2017). The study
substantiates the cause and consequences of these controversies and finds out to what extent
these controversies are true. The cultural differences can lead to gruesome consequences if they
are not managed properly. But, they can also yield the best results if diversity is managed
properly and staff satisfaction is there.
e) Demography of Japan
The population of Japan is very hardworking. Japan has a very limited number of natural
resources, still, it is one of the most developed countries in the world due to the will of the
citizens of Japan. The paper asks questions to the population regarding the demography and
ascertains the exact cause related to population. The hardworking nature of the people ranks
them at superior position. This paper explores the effect of nature of population related to
purchase. The nature of Japanese makes them unique and different from the citizens of the USA.
Their cultural values are different from the citizens of the USA so there is need to keep cultural
demography in mind while planning the business there.
f) Technology

The Walmart has not been able to integrate technology with the daily working of the
stores. It has not embraced digital transformation as yet. In fact, it has shifted from online
retailing to in-store retailing. The exact nature of technology is to find out in this study along
with the extent of the role of technology in the failure of Walmart in Japan (McIlvaine, 2018).
Walmart is resorting to in-store selling, instead of online selling while the its largest adversary
Amazon has gained significant market space due to online sales. The Walmart needs to identify
the causes of these developments and do the needful.
Section 2.5 Quality assessment
.
Research question Assessment Explanation Gaps in knowledge
What is the
performance of
competitors in relation
to the topic
2/3 based on
the three
quality
dimensions
The sources are
predominantly based on the
private documents prepared
by different scholars. The
culture of each country is
different so there is always
need to consider cultural
aspect while planning
business. The foremost
adversary or competitor of
Walmart, Amazon has
considered culture very well.
This is the reason it is the
The sources provide
information on the topic. It
address the research
questions of competitor
performance and strategy

most competitive against
Walmart.
What are the different
cultural habits in
Japan and Asian
countries
1/3 based on
three quality
dimensions
The sources are different
government documents and
international researches done
by previous scholars along
with ratings given by Fortune
global 500. Walmart is
regarded by the fortune 500
as the largest company for the
6th consecutive year. So
definitely it is doing well in
the market of the USA but the
same techniques are not
viable in Japan and other
Asian countries.
The sources completely
address the question of
different habits in different
regions of the world.
Culture influences the
buying behavior of the
customer so it cannot be
neglected. There are
different methods through
which cultural habits can
be used for the advantage
of the business. The fresh
and small amount of food
is preferred by the
Japanese so there are
different requirements
What should be the
approach of Walmart
to address the
concerns of Japanese
customers
2/3 based on
three quality
dimensions
The scope of these sources is
good at it adequately
identifies the method to be
employed by the Walmart.
One size fits all approach will
There is significant gap in
study. The role of culture
different approaches has
not been explained
properly. It is mentioned

not be feasible in this case
along with these issues one
more aspect of employee’s
recruitment needs to be
considered. Adequate
manpower is essential for the
purpose of effective customer
services. without staff how
the organization will operate.
There will be undue delay
and dissatisfaction among
customers.
that one size does not fit
all but which size is to be
considered specifically for
Japan and other Asian
countries is not
determined.
Section 3 Research methodology
Section 3.1 research approach and technique
The research method to be used in the paper is explorative. It is qualitative in nature. The
interview transcripts of the highest authorities, as well as the mass population, will be considered
to evaluate the issue (Bonanno & Goetz, 2012). This method is chosen over descriptive one
because it answers why there is the problem. In this paper, the issue is to find out the answers of

questions asked. There is a need to know the reasons behind the failure of Walmart in Japan. The
descriptive study only answers how it is done.
To find out ‘why’ there is a need to have an exploratory approach. This approach has
some lacunae also like there will be small sample and interpretation of information gathered
through this study can be biased. To overcome these problems, the organization can do
conclusive research on the topic (Basnet, 2018). This will lead to a better analysis and sound
decision-making process will be used to overcome the problems faced by the Walmart in Asian
countries. The nature of the information gathered will be exploratory. This information can also
be gathered from random sample surveying techniques and questionnaire method along with
interview transcripts. This will yield the intended results for the company. The people to be
considered here are the higher authorities and scholars of retail industry along with local mass
population.
Section 3.2 population analysis
As mentioned above higher authorities will be approached for the study through their
interview transcripts. The higher authorities include manager and top-level executives. The
sample population will be clearly identified and the sample will be selected through a random
sample surveying (Halzack, 2018). This will remove the bias nature of the exploratory study.
Every selected person will be asked the same questions so as to different views. These different
views will then be interpreted and the cause of the problem will be identified. This study will not
be able to provide a conclusion or final solution of the problem which can be explored by the
Walmart further to make better decisions.

The estimated size of the population will be 200 including the interview transcripts of
almost 40 topmost authorities. These interview transcripts will present the problem in depth and
it will yield the intended result (Hirsch, 2018). The effective leadership management will be
shown to conduct the study and there will be an inclusive approach so that every individual
contributes to the study. There will be sound analysis methods which will interpret the findings
without any bias. This qualitative study will be done to ascertain the cause of failure of Walmart
in Japan. It will also lead to target other Asian markets in a better way.
Section 3.3 sample designing
The sample will consist of 200 persons, divided into the 10 groups, each group having 20
people in it. The sampling will be non-probability as it is an exploratory study. Two groups will
be formed of the top authorities like managers and executives of the organization. Rest of the
groups will involve local level employees and customers which constitute a mass population. the
questionnaire method will be used to get the answers to the questions asked in the research
proposal (Huang, 2012). There will be a non-biased approach so it would be made sure that the
sampling population consists of the population from a wide range of background. It will include
persons from a different race, gender, religion, and ethnicity. The sampling design will address
the cultural issue as it will consist of different culture people. There will be effective techniques
employed to analyze the result (Kestenbaum, 2017). As this is the qualitative approach, it will
not take much time and does not require experts for the purpose of analysis. This will be an
added advantage of the exploratory approach followed in the paper. This will lay the groundwork
overbuilding can be built by future researchers for the purpose of ascertaining the causes.

Section 3.4 implementation plan
First of all, the targeted population will be identified by population analysis. To approach
the mass population, the random sample surveying will be done and to approach the top
authorities of the organization, interview transcripts will be obtained from relevant government
and private sources. After that, 200 persons will be chosen from different backgrounds
(Lecavalier, 2010). These persons will be asked questions. the questions will be based on
satisfaction related to services of Walmart. In addition to this, their reason for satisfaction and
dissatisfaction will be asked and noted. After sample designing and questionnaire preparation,
the actual Implementation of the plan will be done which will ensure the smooth conduct of all
operations.
The study will be completed in 1 month or 30 days with project scheduling. Different
persons will be hired to conduct the survey. There will be an inclusive approach that will lead to
effective results. Finally, the data will be analyzed and the findings will be identified. The reason
for Walmart’s failure in Japan will find out (Little, 2018). The most common reason will be
identified so as to provide a satisfactory answer for the questions asked in the paper. The
objectives will be met and study will be closed with successful completion.
Section 3.5 Suggested questions :
There are 10 suggested questions which are as follows:
a) What are the factors that influence the choice of grocery shopping among the Japanese?
b) What are the changes in buying pattern of America and Asia?
c) What kind of cross culture grocery buying behavior is there in Japan?
d) How far the Japanese customers can travel to make the purchase?

e) What method does the customers prefer for purchase- online or in-store?
f) What features are considered by the customers while purchasing the products?
g) How much the customers are influenced by the brand image of the company
h) How often the customers check the trends or buzz over social media before making purchase?
i) What brand the customers trust the most for buying the most essential and health related
products like food and medicine?
j) What are the principles considered by the customer while buying products in the context of
environment-friendly goods?
Research question Reasoning or objective met
Question a) and b) Considers the issue related to cultural differences between citizens
of different regions and identify the impact these cultural
differences have on purchasing behavior of the population.
Question c) and d) These questions address the cultural specific to japan, not of whole
Asia. These questions determine the buying behavior of Japanese
citizens
Question e) and f) The questions meet the objective of identifying the method
preferred by the customers while purchasing the products of
Walmart
Question g) The questions addresses the issue of awareness regarding the
company which affect the marketing strategies of the organization
Question h) The question address the modern means of marketing and filling
the demand-supply gap
Question i) The question addresses the role of brand image for establishing

trust between individuals.
Question j) The question addresses one of the most debated issue of
environment-friendly products.
Section 3.6project schedule
Task Duration Start Finish status
Population analysis 5 days 3/12/ 2018 8/12/2018 Completed
Target population
identification
5 days 8/12/2018 13/12/2018 Pending
Questionnaire
preparation
5 days 13/12/2018 18/12/2018 pending
Sample designing 5 days 18/12/2018 23/12/2018 Pending
Actual
implementation
5 days 23/12/2018 28/12/2018 Pending
Data analysis 5 days 28/12/2018 2/1/2019 Pending

Population analysis
Targeted population identification
Questionnaire preparation
Sample designing
Actual Implementation
Data analysis
12/3 12/8 12/13 12/18 12/23 12/28
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