Walmart: Strategic International Management, Essay Example

It is due to the imposition of strict laws by the Japanese government that made the international companies difficult to gain entry into the market of Japan. Moreover, many of the corporations in Japan resisted the merger and acquisition by these international firms because the Japanese owner did not want their enterprises to be intensively altered. Majority of the managers were loyal to the company and stayed in the same organization. So, in the market there was less talent of management available. Additionally, the economy of Japan was less attractive than other nations and it was growing slowly.

Foreign Direct Investment unlike local enterprises, can bring into the Japanese market competition. This is because the foreign corporations are not bounded by the relationships or business practices as the local firms. These firms can bring in new technology, ideas, innovation and management strategies in the Japanese market which enhances productivity.

With the help of acquisition, the local enterprises productivity is enhance because of Walmart as it makes the firms more profitable. An example is that of the Seiyu company acquisition. New policies and ideas have been introduced into the Japanese market which gives more domestic power to the local enterprises through Walmart. The usage of global supply chain to reduce the cost and price, even the localized products both benefitted customers and corporations.

In Seiyu, when the employees were laid off by Walmart, many of the local employees complained that this was due to the business practices of America imposed on the Japanese firms. Also, the introduction of the goods at low prices by the Chinese didn’t win the customer’s preference in Japan. It became harder to sell products at higher value. Due to this a robust competition was developed by domestic competitors. These local competitors reduced their prices and adjusted their policies accordingly. Moreover, many of the suppliers in Japan were not willing to work in Walmart due to the reason that Walmart would too much cut off the prices. There were numerous strategies implemented by Walmart to expand its operations. For instance, the introduction of a 4$ meal for the elderly people of Japan was a special product. It used the supply chain globally instead of the traditional system of distribution of Japanese to reduce the prices and cost.

It is due to the fact that in 2012, Walmart was still in the phase of exploring the market of Japan. It faced a different environment and culture, Walmart has to figure out new innovative ways and strategies to compete in the Japanese market with that of the other corporations. It has to overcome numerous barriers to do so. Once this strategy was successful, Walmart aimed for more profits and expanded.

Works Cited

Walton, Sam. “Case Study: Walmart.” Strategic International Management: 67.