Day 52: Globetrotting with Walmart and visiting WordPress friends

Wandering the World with Walmart

For the second day, we continued our journey with Walmart. This time we went all around the world – Indonesia, China, Germany, South Korea, UK, Japan, and finally into the African continent.

Not every place was a success. Again there were travel lessons.

In South Korea, Walmart’s positioning of low price did not fit with the customer preferences. In Germany, Walmart did not understand that the German did not appreciate strangers smiling at them nor did they appreciate help with bagging their groceries.

Lesson 1: Appreciate the local conditions and live by it

Despite going through the acquisition route, Walmart could not prevent poor performance in South Korea and Germany. Wrong partner. A wrong partner is more dangerous than going alone.

Lesson 2: Just having a travel partner is not enough, it matters who that partner is 

In these explorations, we learned a thing or two about the countries themselves. Germany has high trade unionism. This is paradoxical because Germany is known for its productivity. What explains this is the dual board or the two-tier corporate board structure of German companies. While the management board is equivalent of the normal board, there is a supervisory board that consists of creditors and trade union representatives. Learn more about it here: Why German Corporate Governance is so different?

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Some unoccupied spaces yesterday gave me the time to visit my friends at WordPress. Wheredreamscollide talked about Pakistan National elections in her recent post. Having a basic understanding of Pakistan national politics but not a regular follower, this had me interested. Imran Khan, the cricketer who, in 1992, led the Pakistani Cricket team to a World Cup victory, is assumed to take Prime Ministership. Imran Khan has been toiling in Pakistan politics for the last twenty years to reach here, it would be interesting to compare the characteristics that enabled his success in cricket and politics.

I also visited the people who had visited this page earlier. Joypassiondesire, a single mother of two, is passionate about self-empowerment and draws lessons from her own difficult experiences life. Her journey from self-hatred to self-love is phenomenal.

I’m still to explore James Edgar Skye’s The Bipolar Writer Blog. It looks interesting and he writes on mental health, a topic I care about. Photosociology is a regular visitor here, he tries to illuminate sociology through his photos. I have studied sociology and one day make time to explore his meticulous blog.

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Talking one-to-one with people on a personal level brings more self-understanding and clarity to oneself. The conversation may lead to turmoil or self-doubt in the beginning,  but you find the gaps in yourself and try to fill it. You reach a higher level, a more stable equilibrium. This happened to me today.

Day 51: Rediscovering the American continent with Walmart and learning to self-negotiate

Retail tour

Mexico, Canada, Brazil, Argentina. We were tracing the international journies of Walmart in our international business strategy class.

First, one goes to the places closest to one’s home. And also, cheapest on the pocket.

With the cost of labor many times lower than that in the US, and other advantages like cheap real estate, low competition, and a sizeable population, Mexico was the first choice of entry for Walmart. It entered Mexico through a joint venture with Cifra, Mexico’s leading domestic retailer, and then later acquired a majority stake in the business.

While it made mistakes in the beginning (providing US-like large parking spaces while, in Mexico, most customers came on the bus), it quickly learned to adapt to the local conditions.

The nature of the industry or the market you’re in is a major determinant of country entry strategy. The organized retail industry is a high volume low margin industry with a high initial investment, acquisitions are a great opportunity to scale up fast without the undergoing the time necessary to build the infrastructure needed for physical retail.

A strategy must be both internally and externally consistent for it to be a success. This is true for individual lives as well.

Walmart’s internal competitive advantages of tight logistics and well-oiled supplier partnerships were in sync with its external positioning of being ‘everyday low price.’

Soon it entered Canada, again through the acquisition route by acquiring Woolco stores run by the Woolworth Corporation. It did well here too.

Next, it was Brazil and Argentina. Departing from the tested entry modes, Walmart entered Brazil through Greenfield route, by opening its own stores. Ditto in Argentina. But quickly, learning from its mistakes, Walmart unveiled acquisitions in Brazil. Despite this, Walmart is not finding it easy to make money in Brazil and Argentina.

Travel Lessons from Walmart: If you have a friend in the country you plan to visit, who has been living there for a long time, it is easier to have a good time there, and the risks are much lower. Going to a new country on your own may not pan out as you want it to.

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In the evening, I did some research on the airline industry in India. As I’d mentioned earlier, I had grown a certain fondness for this industry and wanted to explore it. I was with my friend who is an aviation industry enthusiast. I learned at least one thing I was ignorant about: Bilateral service agreements. These agreements between countries decide the capacity of air passenger flow between any two countries that are air-connected.

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Every individual goes through negotiations and conflicts in life. As a team member, as an employee, as a child, as a parent. If nothing, you will at least face conflicts with yourself and you may have to negotiate with yourself.

I was sitting through the brief on the Negotiation course that was offered in the coming semester. We had these briefs by the respective professors so that we can make an informed decision on our courses. I had not given a thought to self-negotiation until today. But now, I believe, of all the negotiations we may have, the ones we have with ourselves are the most important.

Here are a few reads on self-negotiation:

1. Mastering the Art of Self-negotiation
2. Negotiation with Myself