ATMU International Business Final Exam: Walmart Case Study Analysis

This case study analyzes Walmart's international business operations, addressing topics such as factor mobility, international trade patterns, and the impact of trade agreements like USMCA. It examines Walmart's internal audit processes, vision and mission statements, and value chain model. The analysis further explores Porter's generic strategies, Walmart's cost leadership approach, and its global marketing mix, including the choice of foreign markets and entry modes. The study also covers collaborative agreements, and the company's overall international strategy, along with criticisms and responses. The assignment provides a comprehensive overview of Walmart's global presence and strategic decisions within the context of international business.

Running head: INTERNATIONAL BUSINESS
INTERNATONAL BUSINESS
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Author Note:

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Part one: (3500 words)
Question No. 1:
Walmart stores Inc. is a multinational retailing corporation, which manages, operates
and distributes goods and services through a combination of a supermarket as well as a
departmental store and mainly deals with grocery stores1. It is headquartered in Bentonville,
Arkansas in the United States. The organisation was first introduced in the year 1962 by Sam
Walton and also has been the owner of Sam’s Club retail warehouse2. The multinational
corporation has been distributed in twenty-seven countries by collaborating eleven thousand
five hundred and three shops all across the world in fifty-five different names3.
The company has been operating by the name of Walmart, especially in Canada and
the United States and other names like Walmart de México y Centroamérica situated in
Mexico along with Central America4. In the United Kingdom, it has been known as Asda,
and in Japan, it is known as the Seiyu Group. The company has been mainly dealing with the
retailing industry and earned a total revenue of US$514.405 billion in the previous year. The
daily operating income is about US$21.957 billion in the year 2019 and, it has been working
with 2.2 million employees all across the globe according to the report of the year 2018.
The investments that have been made by the company has gained a mixed set of
reactions and has continued to serve the customers effectively for so many years. There might
1 Walmart.com. 2020. "Walmart.Com | Save Money. Live Better.". Walmart.Com. https://www.walmart.com/.
2 Ellickson, Paul B. "The evolution of the supermarket industry: from A & P to Walmart." In Handbook on the
Economics of Retailing and Distribution. Edward Elgar Publishing, 2016.
3 Ellickson, Paul B. "The evolution of the supermarket industry: from A & P to Walmart." In Handbook on the
Economics of Retailing and Distribution. Edward Elgar Publishing, 2016.
4 Ghazzawi, Issam A., Marie Palladini, and Teresa Martinelli-Lee. "The Wal-Mart stores, Inc.: An American
dream that touched the world." Journal of the International Academy for Case Studies 20, no. 1 (2014): 9.

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have been some complaints regarding the organisation, but they have never failed in
attracting the customers especially in the United States.
According to the factor mobility theory, it is referred to as the ability to transfer the
factors of production including labour, capital or land from one process of output to another
production5. On the other hand, International trade pattern is defined as the exchange of
goods and services transferred from one country to another through the process of imports
and exports6. Therefore, the company, Walmart, has been monitoring trade legislation as well
as political ideologies that will disturb the supply chain of goods and services7. The
company’s importing business of products and services are more than its exporting business
in the retailing industry and will support free trading facility8. Therefore, the border
adjustment tax looks quite imminent and if it gets approved, then there will a significant
increase in the costs of importing goods and services.
The strategies such as managing skills in the supply chain, along with, cost leadership
which has provided the organisation with various sustainable comparative advantages such
as, low-cost products, diminishing delivering costs, developing and improving the varieties
along with selection9. Therefore, the heavily competitive pricing for the customers may
disturb the marketing structure in that company and may provide a chance to the other
companies10. The company is famous for delivering low prices and reducing costs that have
5 Redding, Stephen J. "Goods trade, factor mobility and welfare." Journal of International Economics 101
(2016): 148-167.
6 Siegfried, Patrick, ed. International Management in Practice: VW, Google, H&M, Wal-Mart, IKEA, Inditex,
Nike, Red Bull. Vol. 2. Akademische Verlagsgemeinschaft München, 2015.
7 Chaney, Thomas. "The network structure of international trade." American Economic Review 104, no. 11
(2014): 3600-3634.
8 Ghosh, Debabrata, and Janat Shah. "Supply chain analysis under green sensitive consumer demand and cost
sharing contract." International Journal of Production Economics 164 (2015): 319-329.
9 Peters, Malte L., and Stephan Zelewski. "Competitive strategies their relevance for sustainable development in
the food industry." J. Mgmt. & Sustainability 3 (2013): 148.
10 Peters, Malte L., and Stephan Zelewski. "Competitive strategies their relevance for sustainable development
in the food industry." J. Mgmt. & Sustainability 3 (2013): 148.

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led them to the road of success in the retailing business11. The company has embraced
advanced technology as well as adapted innovation in their supply chain12. They always keep
a record of the inventory along with seamlessly restock shelves and transferring the savings
to the customers13.
Question No. 2:
The agreement that has been proposed in between the United
States, the states of Mexico along with Canada (USMCA) have been
attached in a free trade agreement and it has obtained another mark of
significant supporter from the retailing industry14. It has been marked as a
whole new agreement and introduced as “NAFTA 2.015.”
It will help in developing environmental as well as working
regulations and incentivises for the domestic production of trucks and
cars. The agreement has also provided upgraded protection towards
intellectual property in which the United States will acquire more success
to the dairy market in Canada and has imposed a quota for the
automotive production of Canada and Mexico16.
11 ROY, SUVENDU NARAYAN. "COST LEADERSHIP STRATEGY ENHANCING COMPETITIVENESS:
A CRITICAL STUDY ON MNC RETAILS." Journal of Cross-functional Business Research (JCBR): 10.
12 Ghosh, Debabrata, and Janat Shah. "Supply chain analysis under green sensitive consumer demand and cost
sharing contract." International Journal of Production Economics 164 (2015): 319-329.
13 Peters, Malte L., and Stephan Zelewski. "Competitive strategies their relevance for sustainable development
in the food industry." J. Mgmt. & Sustainability 3 (2013): 148.
14 Walmart.com. 2020. "Walmart.Com | Save Money. Live Better.". Walmart.Com. https://www.walmart.com/.
15 Heineman, B. W. "Who's Responsible for the Walmart Mexico Scandal." Harvard Business Review 15
(2014).
16 Heineman, B. W. "Who's Responsible for the Walmart Mexico Scandal." Harvard Business Review 15
(2014).

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Walmart is famous for the giant discount and has publicly asked
Congress in order to approve the agreement of USMCA17. This agreement
has been designed to update the North American Free Trade Agreement
(NAFTA) that was ratified in the year 1994 and allowed the exchange of
goods as well as services among the countries like the United States,
Mexico along with Canada. Walmart explained a statement on a corporate
website, in which they have discussed the position on USMCA and has
tried to impose a positive impact on the jobs, consumers and e-
commerce. In short, Walmart has claimed that North America is the core
of their operations and it has been a global organisation having more than
two thousand eight hundred Walmart retailing units in the countries
including Canada and Mexico. Thus, the company has been supporting for
about four lakh thirty thousand jobs, five thousand the U.S. stores and
clubs, along with 1.5 million U.S. jobs. Therefore, the company was trying
to making them understand that it will be easier for the organisation along
with its respective customers will receive a direct free flow of products
along with services as per the agreement, the USMCA is concerned. Thus,
an entirely new set of commitments on digital media and trade along with
trade facilitation will be quite helpful to assure the advantageous side of
an integrated e-commerce market in North America.
17 Tan, Zekuang. "Application of Discounted Cash Flow Model Valuation–Wal-Mart." Available at SSRN
3100702 (2017).

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Question No. 3:
Internal audit is required to evaluate the organisation’s internal
controls, which will include corporate governance as well as processes of
accounting. In this way, it will help to ensure compliance along with the
laws and regulations, which help to cultivate adequate as well as financial
report and collection of data in the desired time18.
The internal audit of Walmart is monitored through the audit
committee, and the essential functions are: overseeing the processes of
audit analysis by assuring all the laws and regulations that are related and
followed according to the operation of internal audit19.
In this way, the analysis will assure the auditors and will adhere
them to guide about the audit control regulations as given by the GAAP. It
will benefit them to determine whether the processes of the audit is
accomplished appropriately to develop the desired goals and objectives20.
The internal audit will establish the levels of communication along with
interaction in between internal as well as external auditors.
There are some essential strengths that have been highlighted in
the internal audit such as simple formula of allowing goods and services
at a lower price range and this strategy itself makes the organization an
effective one for the customers to walk in and have their desirable
18 Tang, Fengchun, Carolyn Strand Norman, and Valaria P. Vendrzyk. "Exploring perceptions of data analytics
in the internal audit function." Behaviour & Information Technology 36, no. 11 (2017): 1125-1136.
19 Seago, Jane. "A unified approach to compliance: businesses benefit from a proactive partnership between
internal audit and the compliance function." Internal Auditor 73, no. 5 (2016): 49-54.
20 Seago, Jane. "A unified approach to compliance: businesses benefit from a proactive partnership between
internal audit and the compliance function." Internal Auditor 73, no. 5 (2016): 49-54.

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products. Therefore, the company is setting aside their competitors such
as target, far behind this strategy and they have assured a steady road to
success and have gained a swift flow of customers that have been
attracted to their stores for so many years. Walmart has been given points
out of five, and they have gained four out of five because of their
remarkable services. They have highly scored in the field of discount
pricing along with a diverse range of goods and services21.
Question No. 4:
Every company is linked with a different set of vision, and even, Walmart has set its
own vision in order to lead the organisation. The vision statement of Walmart is “Be the
destination for customers to save money, no matter how they want to shop.” In this vision
statement, two things are clearly visible and that is saving money and providing the
customers with a new destination so that they do not leave the company and be guided with
some other company22. The statement claims the primary reasons due to which they desire to
showcase the position of the organisation and be successful in the retailing industry and be
the leader for the rest of the years. The vision statement of the organisation has been
recognized as to what the organisation want to obtain in the upcoming year’s and earn profit
in the long run.
The mission statement of the Walmart company mission is stated as “to save people
money so they can live better.” Therefore, it can be easily recognised that how the desired
organisation has been finding out ways to apply the essential strategies and it will discover an
outstanding difference in anything it touches23. The vital elements are accurately related to
21 Tan, Zekuang. "Application of Discounted Cash Flow Model Valuation–Wal-Mart." Available at SSRN
3100702 (2017).
22 Ferguson, Edward. "Walmart's Vision, Mission, Generic & Intensive Strategies." (2015).
23 Ferguson, Edward. "Walmart's Vision, Mission, Generic & Intensive Strategies." (2015).

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the mission statement, including improvement an individual’s life, financial liberation, along
with expanding one’s expectations24.
Now coming to the mission statement, it conveys a set of critical strategies that the
organisation wants to find out in order to exploit as well as to obtain the desired vision. The
mission statement of the company Walmart is associated with the practical ways so that it can
provide adequate satisfaction to its customers. The existence of the desired principles is
interlinked with the core and important values of the organisation that generates a significant
made a difference in the functions and operations of Walmart. Altogether, it produces the
cogs, which benefit the company in coordinating the vision along with the mission of the
organisation. Therefore, it has been confirmed that it is going form the desired shopping place
that it is going to be the desired location as well as after applying significant strategies.
In the first aspect, the company Walmart has highlighted its vital values along with its
utmost essential objective are utilised to satisfy the necessities of the customers so that they
do not leave the company25. Walmart has always kept clear about the feelings of the
customers, along with making their experiences the best in every possible way. Therefore, the
company has always set attractive pricing, which is still reflected in its saving centre of the
organisation in order to associate with the sheer determination so that they can meet the
aspect.
The second aspect is defined as the direct outcome of the previous one, and that is
associated with gaining the customers’needs through shopping by expanding their savings.
The organisation has recognised this mission as an effective strategy for allowing more
chances to the customers so that they can enjoy their shopping experiences effectively. The
24 BARBERÁ MARCILLA, L. A. U. R. A. "Business analysis for Wal-Mart, a grocery retail chain, and
improvement proposals." PhD diss., 2014.
25 Ferguson, Edward. "Walmart's Vision, Mission, Generic & Intensive Strategies." (2015).

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organisation has also stated that they have been open in providing various options to all the
customers. The diverse range of goods and services have been accompanied has already
proved that Walmart is an incredible player while ruling in the retailing industry.
Question No. 5:
There have been quite a few criticisms regarding the company, Walmart and it has
provided the desired answer to all the objections and has transformed the face of the retailing
industry in the United States and several other countries in the whole world. The company
has been known for its innovative and effective strategy “the cost leadership strategy.” The
company has managed to expand its business all across the globe and has been quite
successful in extending in the international borderline26. Rapid growth has been recognised in
this set of business and has managed to upgrade the brand value in the field of the retailing
industry. The brand has secured enough customer’s attraction towards their goods and
services and has been offering several deals, which merely unmatchable compared to other
companies. It has been more than eleven thousand and five hundred units are operating all
across twenty-eight countries. In so many countries, eleven countries have been coordinated
with operational e-commerce websites.
The retail brand has employed over 2.3 million globally and successfully seen
immense financial profits of the company leaving behind Sam Walton’s values along with
leadership skills have turned out to be profitable in the value chain management27. The
analysis of the value chain of the company Walmart has showcased that the brand has
operated several activities and managed them effectively by involving extraordinary values.
A value chain also consists of all those activities and are also associated with the production
26 ROY, SUVENDU NARAYAN. "COST LEADERSHIP STRATEGY ENHANCING COMPETITIVENESS:
A CRITICAL STUDY ON MNC RETAILS." Journal of Cross-functional Business Research (JCBR): 10.
27 Fernandez-Stark, Karina, and Gary Gereffi. "Global value chain analysis: a primer." In Handbook on Global
Value Chains. Edward Elgar Publishing, 2019.

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as well as sales department of the respective brand from a certain conception28. The
conception also includes raw materials for the final sales along with its respective services29.
Thus, it has been identified as the analytical tool, which has been utilized for optimizing the
value chain that may seem efficient and benefit in generating such sources for the competitive
advantage in the field of business30.
The company is more focused on primary activities, and they are as follows:
1. Inbound logistics31.
2. Operational functions.
3. Outbound logistics32.
4. Sales and Marketing.
Supporting activities such as:
1. Technological advancements.
2. Human resource management33.
3. Procurement.
4. Company’s infrastructure.
28 Fernandez-Stark, Karina, and Gary Gereffi. "Global value chain analysis: a primer." In Handbook on Global
Value Chains. Edward Elgar Publishing, 2019.
29 Gereffi, Gary. "A global value chain perspective on industrial policy and development in emerging markets."
Duke J. Comp. & Int'l L. 24 (2013): 433.
30 Chekwa, Emmanuel, Johanna Martin, and Kathy Wells. "Riding on the waves of sustained competitive
advantage: Consumers' perspectives on Walmart Corporation." International Journal of the Academic Business
World 8, no. 2 (2014): 13-25.
31 LeCavalier, Jesse. The rule of logistics: Walmart and the architecture of fulfillment. U of Minnesota Press,
2016.
32 LeCavalier, Jesse. The rule of logistics: Walmart and the architecture of fulfillment. U of Minnesota Press,
2016.
33 Xie, Yuhua, and Fang Lee Cooke. "Quality and cost? The evolution of Walmart's business strategy and
human resource policies and practices in China and their impact (1996–2017)." Human Resource Management
58, no. 5 (2019): 521-541.

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Question No. 6:
The porter’s generic strategies model has been defined as the combination of three
primary strategic options that are available to all the organisations for obtaining a competitive
advantage34. The three primary strategic alternatives are cost leadership, differentiation, along
with focus35. All of the basic strategic options have been achieved by diminishing the costs to
a certain level that will be lower than the company’s competitors36.
Walmart has been effectively attached to the generic strategic is associated with cost
leadership. The strategy of cost leadership is referred to as the generic competitive strategy
that will be focused on acquiring low costs. Walmart Inc. has been applying a generic set of
policy, and that is cost leadership. Therefore, a theory can be utilised effectively in order to
obtain a definite goal, and that is Michael Porter’s Model. It is one of the essential ways to
define the cost leadership that constitutes a set of generic competitive strategy that will only
focus on obtaining low-costs. Therefore, sustaining as the low-cost producer of the retailing
services along with business outputs, will provide the company to compete, which will be
associated with low-selling prices.
Walmart has always utilised this strategy to construct sustainable competitive
advantage, and mainly it is focused on keeping the prices of all the goods and services quite
less than the other competitors37. It is primarily known for its lower prices daily, and Walmart
34 Chekwa, Emmanuel, Johanna Martin, and Kathy Wells. "Riding on the waves of sustained competitive
advantage: Consumers' perspectives on Walmart Corporation." International Journal of the Academic Business
World 8, no. 2 (2014): 13-25.
35 Folkers, Eric, Alfonso Francisco, and Joel Frey. Walmart supercenters a suitable alternative to shopping at
the commissary for eligible military patrons. NAVAL POSTGRADUATE SCHOOL MONTEREY CA
GRADUATE SCHOOL OF BUSINESS AND PUBLIC POLICY, 2014.
36 ROY, SUVENDU NARAYAN. "COST LEADERSHIP STRATEGY ENHANCING COMPETITIVENESS:
A CRITICAL STUDY ON MNC RETAILS." Journal of Cross-functional Business Research (JCBR): 10.
37 Chekwa, Emmanuel, Johanna Martin, and Kathy Wells. "Riding on the waves of sustained competitive
advantage: Consumers' perspectives on Walmart Corporation." International Journal of the Academic Business
World 8, no. 2 (2014): 13-25.

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has successfully kept all its prices quite more economical than the other rivals along with
more economical economics in the field of the retailing industry38. It has produced a robust
long-term relationship that too with the vendors from which they purchase the bulk of raw
materials. Therefore, long-term relationships, along with the suppliers that are beneficial for
the other parties as well.
Other aspects have been maintained throughout such processes, and they are now
operational as well as production costs39. The company has managed to provide an excellent
set of supply chain management along with logistics management, have benefitted the
organisation by reducing the operational costs40. In the previous years, Walmart used to pay a
quite lower wage to their employees, and after the protests, the brand has minimised the
payments for all the employees41.
Question No. 7:
The selection process is defined as the method of shortlisting of the appropriate
candidates, who will possess the desired qualifications along with practical skills are eligible
for the vacancies in the organisation. The process of selection always varies from one
organisation to another organisation and even from one industry to another industry and in
separate departments in the same organisation42.
For the selection in Walmart situated in Canada, the primary criteria are having
education as well as training regarding the background, the candidates have applied for in
38 Peters, Malte L., and Stephan Zelewski. "Competitive strategies their relevance for sustainable development
in the food industry." J. Mgmt. & Sustainability 3 (2013): 148.
39 Natto, Hassan. "Wal-Mart supply chain management.“." International Journal of Scientific & Engineering
Research 5, no. 1 (2014): 1023-1026.
40 LeCavalier, Jesse. The rule of logistics: Walmart and the architecture of fulfillment. U of Minnesota Press,
2016.
41 Ghosh, Debabrata, and Janat Shah. "Supply chain analysis under green sensitive consumer demand and cost
sharing contract." International Journal of Production Economics 164 (2015): 319-329.
42 Thomas, Steven Edwin. "Automated Statistical Analysis Job Chunking." U.S. Patent Application 15/381,568,
filed June 22, 2017.