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 and the speed of establishment of these two firms internationally 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?
[...] The investment process through a joint venture thus allows Wal-Mart to associate with existing and established local firms and be able to own many other companies without going through a long process of establishing branches abroad. Wal-Mart finds itself at the head of a very large number of stores avoiding most of the risks inherent during the process of internationalization. We found out that countries where the rate of the internationalization process is high, those companies make direct investments by buying a majority stake of existing businesses. [...]
[...] In terms of speed, establishment seems to have been very similar for Hungary and Poland 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 establishment was much slower with about thirty stores opened in a decade. In the case of Ireland, the process of establishment was faster and more successful. Between 1997 and 2006, the company managed to open around 90 stores in the country. [...]
[...] By 1995, the opening of branches in China had enabled Wal-Mart begin to gain experience in the Chinese market, unlike Tesco, which had taken a position in this market only 9 years later in In terms of Tesco, one can see that the results of a study with the theoretical model of the Uppsala school gives results close to those of Wal- Mart: the general characteristics of the internationalization strategy Tesco are the same, only the methods and selection of markets differ. [...]
[...] The beginning of internationalization had been quite late for both companies, as we have seen, and the number of countries in which these two firms are present today is relatively small ( Wal-Mart 15 and Tesco 12). This contrasts with other retail giants like Carrefour. If these 2 firms were to reveal their theories, or the theories of the "Uppsala school", we will be able to notice the differences in their processes of internationalization. It may be worth noting that Wal-Mart had its operations for some time in the UK market, dominated by Tesco (since 1999) and rumors are now that part of Tesco's intention is to enter the U.S. [...]
[...] Firstly, it may be interesting to see if the study strategies of Tesco and Wal-Mart's internationalization can not be a negative factor in denying the existence of a psychic distance between markets.We saw that Tesco, like Wal-Mart chose to internationalize later, that is to say, later in the 90s, in a context of globalization and development of new technologies of information and communication. The psychic distance which has no direct geographical link is still connected to the culture of the countries, and often the countries are close neighbors of their culturally. [...]
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