BUS402 Week 5 Discussion Forum 2

Assessing how Cultural Barriers potentially affects the strategic considerations of Walmart in a global economic environment.

Being the leading retailer in the world, Walmart is conducting businesses across 27 countries. The expansion has made the company ready for entrant into new markets. Globalization, however, is continuing to attract more investors into the retail market industry. Walmart has been experiencing cultural barriers when expanding its operations in Asian markets, especially in India and China. Therefore, cultural barriers are some of the challenges that a company operating in international markets face.

The international business environment is always inundated with challenges of cultural differences. In the Asian market, Walmart encounters resistance from local communities. They view Walmart as attempting to intrude and snatch the business opportunities for the local small traders. In fact, in Asia, the local business communities coerce the authorities to deny Walmart’s permit to operate in their country. Here, cultural differences mainly affect Walmart’s operations in the Asian markets. For example, in China, Walmart is faced with aggression by the locals as they felt it wanted to alter their cultures. China’s retail stores are usually dirty, noisy, and overcrowded. Yet consumers love it that way. When Walmart tried to introduce the concept of hypermarket, with well-spaced, clean outlets, and sales, the consumers felt uneasy since they are used to their usual retail stores. This is the same situation in India. Locals prefer shopping in roadside stores rather than in hypermarkets that Walmart introduced. The disposable income level in India is very minimal; hence, locals establish personal relationships with store owners to obtain goods on credit when they do not have cash. Therefore, social relationship plays a significant role in the success of Walmart in India.

Propose language to add to the organization’s strategic plan that addresses the potential impacts to the organization’s global strategy

Walmart should establish consumer preferences that are driven by culture in some markets, primarily in the Asian markets. This will help to provide goods that promote the local community’s lifestyles. For example, they can start providing products at credit to customers to enrich the social relationship. Also, they can establish small retail shops rather than a giant hypermarket. In this, Walmart will not try to alter or change the locals’ culture but promote and embrace it.