Global Walmart: Lessons from the Locals | God's World News

Global Walmart: Lessons from the Locals

09/06/2016
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    Shoppers poke and prod before buying fish on sale at a Walmart in Shenzhen, China. (AP)
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    Baby will have to be patient as this Walmart shopper nets a live fish for dinner in China. (AP)
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    Lab workers evaluate samples in a van used to test food safety at grocery stores. (AP)
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    Walmarts in Chile changed their sale signs to red. People in that country associate red with good deals. (AP)
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    Chile is one of the top three bread-buying countries, so Walmart worked on its bakery departments. (AP)
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In the Land of the Big Box, Walmart is king. But even the king sometimes struggles to get along with the citizens. And as Walmart seeks to expand its already ginormous empire, the superstore has had to learn a few lessons.

Walmart operates more than 11,500 stores in 28 countries. The retailer is firmly entrenched in the U.S. marketplace. But establishing Walmart in other countries has been difficult.

Walmart gave up in Germany and South Korea 10 years ago. The company is closing 10 percent of its stores in Brazil. In the United Kingdom, it is slugging it out with no-frills German discounters Aldi and Lidl.

But Walmart experiences some international successes too. In Mexico, Canada, and Japan, the company has won shoppers over time.

CHINA: LESSONS IN CHANGE

China, the world’s most populous country, is the most sought-after global market. Walmart has just over 400 stores there, compared with more than 5,000 in the United States.

But China is not the United States.

In the States, Walmart offers “everyday low prices.” Penny-pinching, bulk-buying American customers love a deal. But Chinese consumers are wary: If milk seems too cheap, they wonder if it is safe. If items stay on sale too long, they worry there’s something wrong. Plus, Chinese shoppers seek fresh food daily—their tiny refrigerators don’t allow for stocking up.

In U.S. Walmarts, fresh meat appears behind glass—no touching the pigs’ feet or sausages. But in Shenzhen, Walmart customer Zhong Guoyan sifts through piles of fish with her hands. She studies the fins—are they firm? She inspects the eyeballs—do they bulge?

“If it’s good, then I will buy it. If it’s only cheap, I won’t buy it,” Zhong says.

Chinese shoppers want to know that efficiency and good management—not cutting corners—make low prices possible.

CHILE: A STUDY IN SUCCESS

In Walmart’s global kingdom, Chile is the crown jewel. Sales in the South American country have soared.

Admittedly, conditions in Chile were favorable from the get-go. The economy is stable, and Chilean customers are similar to Americans. It also helps that Walmart bought an already successful chain called Lider. Such factors allowed Walmart to swiftly convert the Chilean business to its “everyday low price” model.

But a big part of Walmart Chile’s success is tracking price perceptions. Workers visit customers’ homes daily. They monitor 1,500 people in 11 cities. Walmart makes adjustments based on customer responses. The result? Chileans believe the price gap between Walmart’s Lider and competitors is twice what it really is.

Walmart also adopted local custom by making red the signature color for price signs—Chileans associate red with good deals. Further, the company found a message that speaks to no-nonsense Chilean shoppers: “Precios Bajos Todos Los dias. Compruebalo en el Total de tu Boleto”—“Everyday low prices. Check the receipt as proof.”

Even Walmart’s failures in Chile show a commitment to adapting quickly.

Take the bread fiasco.

Bread is a big deal in Chile. The average household eats nearly 200 pounds of soft rolls, biscuits, and other breads per year.

Walmart officials tried to save money by making bread at a company-owned bakery. But customers complained the bread wasn’t right.

“It doesn’t have that crunchy aspect,” said the manager at a Walmart store in Santiago.

Walmart listened. It tweaked the bread-making process.

LISTENING TO THE CUSTOMER

Walmart wants to keep its corporate culture—without forcing it on non-Americans. That attitude may be key to the company’s global success. Walmart founder Sam Walton famously said, “There is only one boss. The customer. And he can fire everybody in the company . . . , simply by spending his money somewhere else.” Walmart seems intent on heeding that observation—even if it means fish in the aisles.