International Business Communication
The Wal-Marts was able to thrive in the Chinese market by focusing on three strategies. That includes enhancing union with national and local government officials as well as agencies, implementing “the small store urban operation” that is fundamental in larger Chinese metropolises, and advancing comprehensive customization of their supply chain to the market needs. Walmart organization stumbled in China as if it failed to research the customer desires in concern to Chinese culture adequately and cater to its stock in the market. Sales declined, food safety scandals, CEOs rapid turnovers, and government scuffles prevented the organization from prevailing in the market despite being viewed as a golden opportunity.
Walmart faced several operational and cultural issues in China as compared to America. To begin with, the shopping mode of Walmart in China faces the danger of the convenience stores. The other operational issue facing China is the potential entrants to the market who diversify the market, thereby leading to competition and reduced sales for Walmart. That has been an increasing trend in China. Walmart, being a large enterprise, its bargaining power ought to bring about advantages. In sharp contrast, the bargaining advantage in China has ceased to exist due to local government protection and relationship marketing in the local supermarkets (Jun & Yu, 2015). It is important to note that the consumers in China are not accustomed to America’s mode of “membership” and are not familiarized with the shopping setting of the great packaging warehouse.
Additionally, Walmart being the leader in the retail chain, has the advantages of the talent reserves, brand value, financial resources, innovative technology. The economy of China has the feature of economic transition and has not established the market mechanism and perfect market framework. In many scenarios, government policies have the characteristics of executive meddling (Jun & Yu, 2015). On the other hand, the cultural issues include the location, attention to price, mode of shopping, and consumption trends. To begin with, many American citizens reside in the conurbations and continuously drive to supermarkets. The Chinese people opt for living in places that emphasize more on the opportuneness of life to enable them to buy things they require when they go out to relax (Jun & Yu, 2015).
The American citizens are much concerned with the expenditure while shopping, whereas the Chinese consumers opt for determining through prices, for instance, by comparing prices and choosing promotions. American consumers often go to the shopping malls at a definite time weekly, whereas the Chinese people prefer to go frequently and purchase less. The negotiator would have educated the Walmart management on the consumption habits, the way of shopping of the Chinese. That would increase the total sales made by Walmart in the Chinese market.