We will look at the strategies implemented by the companies Wal-Mart and Tesco, in order to internationalize their brand. To analyze the strategies, we will look at the various markets chosen abroad, the processes, the rate/rhythm and the speed of establishment of these two firms internationally, up until the year 2006. Finally, we will look into our topic further, with the following question: Can the cases of Tesco and Wal-Mart be used to show the shortcomings of the theory of Uppsala?
It is thus noted that Wal-Mart is mainly based abroad in Latin America and it is present in only two European countries (UK and Germany) and two Asian countries (China and South Korea). This is contrary to Tesco which is very well established in Europe (including Eastern Europe) and Asia.
In the two cases, the beginning of the internationalization process corresponds to the 1990s, and Wal-Mart began four years before its competitor, in 1992.
Wal-Mart is currently the world's leading supermarkets, Tesco ranks third but is the leader in the United Kingdom, which is its home market.
Let's look first at the speed of the process of internationalization of Wal-Mart.Wal-Mart began its process of internationalization in the early 1990s.
The company turned first to Hong Kong in 1990 and later to Mexico in 1991. In November 1991, it opened the SAM'S Club in Mexico.
Fifteen years later, Wal-Mart had 774 stores in the country, some that were as famous as Wal-Mart but the others were distributed in various joint ventures in which the company had decided to invest, such as Mi Bodega, Superama, Suburbia, etc.. We can therefore say that the speed of the internationalization of Wal-Mart in Mexico has been staggering. In terms of pace, this represents five stores on an average per year.
After Mexico, Wal-Mart then turned to Puerto Rico, an island whose special status of "Free Associated State in the U.S." makes it look like an extension of national territory in North America.The opening of the first Sam's store tracking mag in 1992, has had some great drawings; however, it does not mean that the establishment in Puerto Rico was really fast. Wal-Mart seems to have found its place, thanks mainly to the redemption of the chain comprising 32 Amigo stores that allows it to reach the current total of 54 stores this territory.
By 1994, the company turned to Canada, its other neighbor. The implementation was done through the purchase of 122 Woolco Canada Stores. This method allowed Wal-Mart to gain a foothold in Canada by reducing the risk in the years following the impetus to open stores in its name. Currently, there are 272 stores, which means that if the beginning was cautious because of local competition, Wal-Mart has managed to more than double its presence in terms of number of stores in a dozen years.
In 1995, Wal-Mart went into high gear by addressing Argentina and Brazil simultaneously. However, Argentina does not appear to have been a success since, currently, there are only 11 stores. Brazil marks a new success on the contrary, and in the space of 11 years, it has seen the rise of stores from 4 to 295.
Tags: Wal-Mart expansion strategy, Retail sector, Tesco globalization strategy
[...] C.Process Uppsala Tesco and Wal-Mart are two of the world's leading retailers. To internationalize their journey was almost identical, at least in Arence: in both cases, the beginnings of internationalization have been quite late, as we have seen, and the number of countries in which these two firms are seen here today is small (15 for Wal-Mart and 12 for TESCO).This contrasts with other retail giants like Carrefour. If you pass these two firms to the theories Jan Johanson and Finn Wiedersheim-Paul, or the theories of the "Uppsala school", we can see that there are differences in their process of respective internationalization. [...]
[...] The answer is yes since cultural differences are real differences between countries and even regions One of the most obvious criticisms that can be learned from studying the strategies of Wal-Mart and Tesco could be a significant challenge to the process . Indeed, for the economists for the school of Uppsala, a company develops various stages.One may say that there would be some kind of learning of internationalization, and business strategies that evolve towards increasingly sophisticated tiquées at the option of acquiring knowledge and experience on the international stage.The current reality proves less and less as this is a very mechanical approach. [...]
[...] So Level 3 constitutes the major step of the internationalization process for Wal-Mart and Tesco establishing subsidiaries abroad. Level 4 relates to the production that has no raison d'etre. This shows that the two competitors have moved from level 1 directly to level 3 as defined in the theory of Uppsala. However, we can qualify the aim in regard to what we have discussed earlier: Wal-Mart, and Tesco go through three distinct levels, and are being different from what has Uppsala.Indeed, a stage of internationalization nonexistent, Wal-Mart and Tesco are often located abroad by buying shares of companies already existed before creating their own branches. [...]
[...] In terms of speed, the implementation seems to have been very similar for Hungary and Poland and since a decade, Tesco has reached a level of 70 to 80 stores in each country. Regarding the Czech Republic and Slovakia, the rate of implantation was slower: there are only about thirty stores opened in a decade. The case of Ireland is a bit different in that the location of Tesco is later but faster and has been more successful: between 1997 and 2006, and the company has managed to give itself in almost 90 stores in the country. [...]
[...] Wal-Mart began its process of internationalization in the early 1990s. The company turned first to Hong Kong in 1990 and later to Mexico in 1991. In November 1991, it opened the SAM'S Club in Mexico. Fifteen years later, Wal-Mart had 774 stores in the country, some that were as famous as Wal- Mart but the others were distributed in various joint ventures in which the company had decided to invest, such as Mi Bodega, Superama, Suburbia, etc . We can therefore say that the speed of the internationalization of Wal-Mart in Mexico has been staggering. [...]
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