Walmart Success in Mexico

ISSUES AND CHALLENGES.

1. Cultural differences

Due to culturally diversified market, large retail companies when expanding their operations are forced to have joint ventures with other local retailers in the country to help them learn more about the country.. Because of significant income and cultural differences between the United States and Mexican markets about which Wal-Mart needed to learn, and to which it needed to tailor its operations, the company chose to form a joint venture with Cifra, Mexico's largest retailer, counting on it to provide operational expertise in the Mexican market. Multinational retailers expanding into culturally diversified markets chose to have joint ventures with local retailers in the country to help them learn more about the country (Sternquist, 2007).

2. Opposition

Whenever a Large retail giant enters a country it expects opposition from government and local retailers. This was the case with Wal-Mart company.to its advantage Wal-Mart received support from the Mexican government and common people who would benefit from quality products at low prices

3. Laws and regulations

Mexico sent many request to the congress to approve the proposal to upgrade the anti-monopoly laws to international standards. This would affect Wal-Mart if the laws were approved, it would see him lose better technology and larger sizes to offer lower price

4. Economic slowdown

Slow growing purchasing power in a developing country affects how consumers spend. The slow growing Mexican economy was a threat to Wal-Mart since it would his company growth

The slow growing economy in Mexico was a challenge to Wal-Mart which in turn affected the consumer spending

5. Competition

Whenever a company enters a new country, it can expect retaliation from local competitors as well as from other multinationals already operating in that market. Successfully establishing local presence requires anticipating and responding to these competitive threats.

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