Critical Issues in Business Management: Drivers of Internationalisation for Walmart in India

This report discusses the drivers of internationalisation for Walmart in India and its strategies so far. It also explores the significance of the India market for Walmart's internationalisation strategy and the possible challenges that Walmart faces in India going forward including sustainability.

Critical Issues in
Business Management
module

Table of Contents
Introduction......................................................................................................................................3
Main Body.......................................................................................................................................3
Discuss and analyse the drivers of internationalisation for Walmart in India and its strategy so
far................................................................................................................................................3
The significance of the India market for Walmart's internationalisation strategy:.....................5
Possible challenges that Walmart faces in India going forward including sustainability. What
Walmart do to emerge as a strong player in the Indian Market..................................................6
Conclusion.......................................................................................................................................7
References ..................................................................................................................................7

Introduction
Business management is the organisation and coordination of the business activities. The
critical issues of the business is a opportunity or problem which is critical to the overall success
of the organisation. In order to raise funds from investors it is a process of offering securities. In
this report, Walmart is our chosen consideration which is American International retail
corporation which and it operates in a discount departmental stores, chain of hypermarkets and
grocery stores from United States (Agostini, Galati and Gastaldi, 2020). In this report the various
factors the drivers of internationalisation for Walmart in India will be discussed and analysed and
their strategies so far. Apart from this, the significance of India market for Walmart's
internationalisation strategy will be discussed. In addition to this, the various possible challenges
that Walmart can face in India going forward including sustainability will be explained and how
it can emerge as a strong player in the Indian market.
Main Body
Discuss and analyse the drivers of internationalisation for Walmart in India and its strategy so
far.
Walmart is an American International retail corporation which operates a discount
department stores, grocery stores and chain of hypermarkets from united states. In order to enter
in India the Walmart need to consider various factors and strategies to increase the market share
and profitability in the long run. Some of them are as follows and discussed in detail:
Large Customer Base: In India there is large consumer base as they easily adopt the new
product or companies in the market. Walmart offer the products at lower price to its customers
and also offers good quality products to its customers at an affordable prices. Walmart sells its
products directly to customers but in India it moved away from selling directly to customers by
opening cash and carry format stores (Halberstadt and et.al., 2019). The consumers of India get
influenced easily by the new products which is attractive, innovative and affordable to them. In
India the population is large and it is the essential factor which is necessary to be considered by
the company Walmart. I can increases the consumers base by selling its products at an affordable
prices. People of India always wanted to try something new such new and innovative technology

and new products or companies available in the market which serves products at lower or an
affordable cost.
Cost Drivers of Globalisation: It certainly plays critical role as the drivers of
internationalisation for Walmart in India. It is influenced by broad considerations such as
exchange rates, cost of labour, currency value and materials in different location. The company
like Walmart in India can benefit from the market as they can increase their profit margin at the
large scale. It is because the law material cost is low in comparison to other countries, labours
can be easily available as there is large number of population in the country like India. By the
help of these factors they can lower their operating cost and earn the huge profits from the
country like India (Maity, 2019). It is the key factor for the company like Walmart because in
India the currency value is low in comparison to other countries and exchange rates in different
location which is very helpful for the company to increase its market share, profitability and able
to build its brand image in the country by utilising the resources of country like India and
increases the sales.
Role Of Government: Globalisation has taken place across extensive domains which are
governed by different policies and laws. Government of India implement the strategies which
encourage and leverage market drivers such as availability of capital and adjusting interest rates
in order to encourage spendings and investment in India. Sometimes government restricts the
availability of foreign goods by giving their own domestic companies advantages of competitive
market. In India the government imposed some restriction at first they are prevented from selling
their own goods or holding inventory which Walmart do in other markets. At second the degree
in which the they can own big sellers on platforms is limited (Qureshi And et.al., 2020). The
government rules and regulations are not that strict in comparison to other country and
international brands can easily enter in the market of the country in order to increase the market
share and sales of the company. It will help the government also as the foreign direct investment
will enter in the country effectively and efficiently.
Cost of Labour and material is low: In India the cost of labour and material is low in
comparison to other countries. Which is the major factor for the Walmart to enter and expansion
of its business in the country like India. They can easily get the material and labour at low cost so
that they can earn the high profit and used it for further expansion. Through this they can also
sell their products at low cost and an affordable prices which help the customers and company at

the same time. It is an effective factor for company as well as for the country also as it helps to
generate employment in the country and utilise the material of the country at an affordable cost.
It helps the country to increase its market share and profitability and able to expand its buisness
more at an affordable prices.
Competition: In comparison to other countries the Walmart faces less competition in
India as there are few number of big retail stores in India where all the products can be easily
available under the one roof. Some of the competitors of Walmart are Reliance retail stores,
Flipkart and Amazon. So that the company Walmart can easily face the competition in the
market and gain the market share by making proper utilisation of resources. It can increase the
profitability by selling goods to its customers at an affordable prices which increases the sales of
their products and increases the profitability (Rafique and et.al., 2020).
The significance of the India market for Walmart's internationalisation strategy:
There are various strategies used by the Walmart to get internationalisation in the India
market. Some of the strategies are explained in detail as follows:
Adapting to changes quickly: In India the government goes not allow the foreign
companies to use their supply chain expertise in order to achieve the reduced price for the Indian
online shopper it is important for the company to adapt to changes quickly which helps the
company for its expansion in the country like India effectively and efficiently by proper
utilisation of resources appropriately (Rane, Potdar and Rane, 2019). They need to adapt the
consumer taste and preferences which is necessary for the company to make this strategy before
entering in the new market or country like India.
Everyday Low Price: In order to get successful in the country the company Walmart uses
the strategy every day low price strategy in India. As by applying this strategy the company
offers its good quality products and services at low price everyday to its customers. It will help
the company to gain the customer attention and increases the sales at an optimum level. In India
consumers prefer to buy the product of good quality at lower price which will going to enhance
the company's sales at an optimum level and can go for further expansion.
Sell product through mediator: In India the company Walmart sell their product through
Mediator like wholesalers as the company cannot make the direct sale to consumers. They make
the strategy to move away form direct selling to customers by opening cash and carry format
stores. As this can be more profitable for the company in order to increase its profitability and

market share in comparison to its competitors. Although Walmart is the large retail company and
offers good quality products to its customers at an affordable prices. By cash and carry operators
sells merchandise to hotels, catering firms and kirana stores which is necessary for the Walmart
to make this strategy. In India 905 of the goods are sold by the help of small kirana stores.
Double its Stores: The Walmart company makes the strategy to double its stores in the
coming three to four years. Planning to open almost 6 stores in the Telangana and Andhra
Pradesh state of India (Reuter and et.al., 2019). Launching its online platform for the consumers
and members.
Possible challenges that Walmart faces in India going forward including sustainability. What
Walmart do to emerge as a strong player in the Indian Market.
There are various challenges that a company faces India going forward including
sustainability which are as follows and explained in details:
Lack of Technology Adoption: The company like Walmart faces the huge challenge of
lack of technology adoption. Such as the feasibility, adoption and availability of technology. In
India people lack to adopt new technology so fast and quickly. But the scope of technology is
wider in India. Technology which is used for day to day activities for example billing and
payments, keeping records of stock and supply chain management.
Insufficient Supply Chain Management: In the country like India there is a lack of
supply chain management and it is very important for the company to deliver the products at
right place at the right time (Sawhney and et.al., 2019). It need to be improved and need for more
technology in order to have the smooth functioning, reduce the inventory cost and effective make
the supply chain management.
Lack Of Infrastructure and Logistics: inefficient logistics and infrastructure is resulting
in the inefficient processes. It is challenging for the Walmart in timely distribution and
warehouse facilities. India is a developing country and Walmart company comes from the
developed country which is most challenging in itself to establish the business which has lack of
infrastructure and logistics facilities.
Cultural Diversity: The Walmart has to devise the strategies for different segments and
sectors which is the most challenging part for the company. As India has huge socio economic,
size and cultural diversity which means there is no consumption pattern or established mode
through out the country.

The Walmart can do to emerge as a strong player in the Indian market by not selling or
moved away from directly selling to the customers by opening cash and carry format stores. It
can be done by selling to small wholesale buyers because there are no more restriction regarding
foreign direct investments for foreign companies (Ulman, Musteen and Kanska, 2021). In order
to overcome from these challenges the Walmart need to improve the innovative strategies with
efficient logistics systems as these are the important to negotiate the extensive internal
communication or challenges which is very important and necessary for the company like
Walmart to establish its business in India effectively, efficiently and appropriately.
Conclusion
From the above report of critical issues in business management module it has been
concluded that business management is the organisation and coordination of the business
activities. The critical issues of an organisation is a opportunity or problem which is critical to
the overall success of the organisation (Xie and et.al., 2020). In this report Walmart has been
taken into consideration which is an American multinational retail corporation. It has been
discussed and analysed the drivers or factors of internationalisation of Walmart in India and its
strategies so far has been discussed. Furthermore to this, the significance of the India market for
Walmart's internationalisation strategy has been discussed and explained in this report. In
addition to this, the possible challenges that Walmart has faced in India going forward included
sustainability. What should the Walmart do to emerge as a strong player in the Indian market has
been explained in detail which could help the organisation for the successful expansion and
internationalisation.
References
Agostini, L., Galati, F. and Gastaldi, L., 2020. The digitalization of the innovation process:
Challenges and opportunities from a management perspective. European Journal of
Innovation Management.
Halberstadt, J. and et.al., 2019. Skills and knowledge management in higher education: how
service learning can contribute to social entrepreneurial competence
development. Journal of Knowledge Management.
Maity, S., 2019. Identifying opportunities for artificial intelligence in the evolution of training
and development practices. Journal of Management Development.
Qureshi, K.N. And et.al., 2020. Internet of vehicles: Key technologies, network model, solutions
and challenges with future aspects. IEEE Transactions on Intelligent Transportation
Systems, 22(3). pp.1777-1786.

Rafique, W. and et.al., 2020. Complementing IoT services through software defined networking
and edge computing: A comprehensive survey. IEEE Communications Surveys &
Tutorials, 22(3). pp.1761-1804.
Rane, S. B., Potdar, P. R. and Rane, S., 2019. Development of Project Risk Management
framework based on Industry 4.0 technologies. Benchmarking: An International
Journal.
Reuter, M. A. and et.al., 2019. Challenges of the circular economy: a material, metallurgical, and
product design perspective. Annual Review of Materials Research, 49, pp.253-274.
Sawhney, R. and et.al., 2019. Teaching sustainable lean: the next step towards inculcating a
critical problem-solving mindset. In Lean Engineering for Global Development (pp. 61-
94). Springer, Cham.
Ulman, M., Musteen, M. and Kanska, E., 2021. Big data and decision‐making in international
business. Thunderbird International Business Review, 63(5). pp.597-606.
Xie, R. and et.al., 2020. Satellite-terrestrial integrated edge computing networks: architecture,
challenges, and open issues. Ieee Network, 34(3). pp.224-231.