Management Strategies Wal-Mart should undertake for Successful Global Presence - Essay Example

Decrease in government restriction resulted in increased opening up of the China retail market. Global retailers such as Wal-Mart took advantage and opened store in China. Though Wal-Mart started as a small, store in Arkansas, it spread rapidly and dominated the retail sector in United States. Wal-Mart’s founder, Walton, believed that discounting was crucial in retail business. He opened stores in neglected areas and sold goods at considerably cheap prices (Glass, 2012). The use of “Everyday low prices” gave Wal-Mart a competitive advantage over its competitors.

Additionally, Wal-Mart developed a strong marketing culture such that it remained popular even when its competitors, Kmart and Woolco, closed down. However, Wal-Mart’s entry into China was not successful. China opened up its market for foreign retailers in 2005, which Wal-Mart saw as a great opportunity. This is because China’s thriving economy provided a great opportunity for profitable retailing. Despite Walton’s insistence on discount prices, Wal-Mart remained less popular in China (Farhoomand & Wang, 2006).

One of the main drawback was the resignation of Cassian Chueng, the president of Wal-Mart China, which happened at the time when the entry plan was at the initial stages of implementation. Irrespective of being the world largest retailer, Wal-Mart is ranked at position twenty in China in terms of its sales (Glass, 2012; Wang, & Jha, 2011). One of issues facing Wal-Mart is managements’ refutation of employee’s unionization. Sam Walton opposed formation of union by War-Mart employee’s rights from the initial stages. . The Wal-Mart employees have attempted to demand for salary increment and they feel that such grievances have not been clearly addressed (Wang, & Jha, 2011).

To create a successful global presence and ensure the success of Wal-Mart in meeting its goals and mission, the management must address the issue of Unionization. This issue has been criticized strongly, which could affect Wal-Mart performance. Additionally, the success of any organization greatly depends on the level of satisfaction among the employees. It is thus inevitable that Wal-Mart should consider accommodation unionization to ensure the employees’ grievances are addressed accordingly (Glass, 2012; Farhoomand & Wang, 2006).

Another issue that has affected Wal-Mart’s entry into China is their expansion strategy. In United States, Walton preferred opening stores in small towns, which gave Wal-Mart a competitive advantage. However, Chinas economic growth is more rampant in large cities, particularly those along the coastal region. It is thus significant for Wal-Mart to reconsider the positioning of its store in China. Although there are existing barriers such as resistance from China authorities to let Wal-Mart expand in large cities, the management should consider forming venture in such regions (Glass, 2012; Farhoomand & Wang, 2006).

An alternative that would enable Wal-Mart to retain cheap prices and expand its operations would be to change their marketing strategies. The US market environment is quite different from that of China. This is mainly due to cultural differences. Wal-Mart should thus consider exposing its employees to Chinese culture to understand the needs of their consumer appropriately. As opposed to US where the