Wal-Mart had established more than 4,300 stores by the year 2002 in different countries in the world; the largest number of stores was in United States with over 3,000 stores and the least number in Korea where they had 9 stores. There are five branches through which it operates in United States: Wal-Mart Stores, Wal-Mart Super Centers, Sam’s Club, McLane’s Company and Wal-Mart International.
Through Wal-Mart Stores the company is able to pay its revenue as 55% of the revenue comes from there, Wal-Mart super centers is growing fast as compared to the other departments and so it provides10% of the company revenue, the number of Super Stores in the United States is three. Any interested customer has the option of paying a certain amount of money per year in order to become a member in the Sam’s club (Katobe, 2003).
McLane’s company deals with the distribution in Wal-Mart, this company was obtained in 1990 and in 1995, and McLane generated 6% of Wal-Mart revenue. Wal-Mart international generates 17% of Wal-Mart revenue and had a net sale of $35 billion in 2002, an increase of more than 41% from the year 2000. The company ventured in Mexico, Canada, Argentina and Hong Kong in 1980’s through collaboration with the local companies.
In Mexico they collaborated with Cifra which later came to be called Wal-Mart de Mexico, in 2003, it was the largest retail store in Mexico. In Canada the venture was the easiest since majority of Canadians already knew about Wal-Mart due to its close proximity with United States, after eight years it was the best retail store in Canada, it is also the best success story in the Wal-Mart’s venture into the international arena (Katobe, 2003).
In Wal-Mart’s official website, under the basic rules and values, in order for Wal-Mart to still maintain the good reputation of good service and reduced prices that they hold with their customers, they have to show all people respect and treat their customers to the best service for all products that they require, good customer service is important (wamartstores. com). Challenges
The venture into Brazil was hampered by certain challenges, among the challenges, was high cost of production in Brazil due to the high electricity cost, therefore they had to import electricity from Paraguay, in addition, the Brazilian economy in 2003 was also not stable. They were also not able to understand the needs of Brazilians; Wal-Mart would sell products in their stores which were of no use to the ordinary Brazilians.
There was also a discord in the advertisement criteria because instead of using radio which majority of potential customers listens to, Wal-Mart chose to use television and newspaper advertisements. They also faced competition from other retail stores who seemed to understand the Brazilian market and the peoples needs better. The list of competition included: Carrefour a French retail store which had established stores in Brazil and had absorbed the Brazilian culture and thus are not seen as foreigners, and Royal Ahold a Dutch retail company, among others (Katobe, 2003).