Problems at Wal-Mart March 28, 2007Posted by collage9 in Retail.
It was interesting to see that one of the world’s largest and most successful corporations is actually facing some difficulties. I feel like most people see Wal-Mart as untouchable, when in reality they are not immune from facing obstacles just like any other company. We all know about the company’s success in the U.S., where it currently operates 4,000 stores, but this can’t be said yet for their global operations. Recently, Wal-Mart actually pulled out of Germany and South Korea. In other important countries, such as China, Wal-Mart is behind in market share to European competitors like Tesco and Carrefour. They need to figure what appeals to each region they operate in and have to realize that what appeals to the American market won’t exactly translate well over seas. They are beginning to take some minor steps, such as putting live seafood in its 73 stores located in China.
It is essential to the company that they straighten out their foreign operations because they really don’t have any more room to grow in the US. They are concerned with stores taking sales from one another since there are so many throughout the country. In addition to this lack of space, sales growth at older stores (stores open at least a year) is actually behind that of its archrival, Target. They have been growing about 1 to 3 percent on average in the last 3 threes, compared to more than 5% previously. I’m not saying that Wal-Mart is in jeopordy by any means, just that it needs to take a closer look at and improve its global markets if it wants the continued growth it has experienced throughout its lifetime.