Walmart International Strategy (What Is It, Strategies + More)

Walmart has rapidly grown to be everyone’s favorite big box store that sells everything from apparel to groceries and electronics.

The company has grown to be a giant retailer with successful operations outside the United States. Due to this, you might be asking, what’s Walmart’s international strategy? I researched the matter in-depth, so here’s everything I discovered!

What Is Walmart’s International Strategy In 2022?

Walmart uses an international expansion strategy to enter into overseas markets, establish a growing presence and become profitable in the retail industry as of 2022. While Walmart may dominate the domestic sector, the management utilizes formal and multi-strategic plans that mitigate expansion risks and encourage the utilization of resources and capital to penetrate new markets.

If you want to get more information about Walmart’s international strategy, how it expands internationally, its successes, and much more, keep reading!

Which International Strategy Does Walmart Follow?

Walmart follows an international expansion strategy and continues to achieve extraordinary growth and success in the US and international markets.

That said, the giant retail store has globalized its operations to serve underserved markets and gain the growth earnings expected by the shareholders.

Currently, Walmart dominates the US domestic market and earns 24% of its total sales from international markets.

Moreover, the store operates around 10,500 stores and warehouse clubs under 48 banners in 24 countries and eCommerce websites.

Under its parent name, Walmart operates in the United States and Canada, as Flipkart Wholesale in India, and as Walmart de México y Centroamérica in Mexico and Central America.

Also, other Walmart locations operating under different banners include stores in Chile, China, and a few countries in Africa.

Why Is Walmart Successful Internationally?

Walmart is successful in international markets due to the unique business model that promotes effective ways to enter and penetrate a new market.

Initially founded in the US, the store has expanded its operations and is successfully operating retail stores in different countries due to effective international expansion strategies.

For example, Walmart’s business model of promoting the “Every Day Low Prices” is the integral success factor that makes Walmart succeed in international markets.

That said, the business model creates a way of maintaining competitive prices by concentrating on four key areas:

  • The volumes of sales
  • Innovation of supply chain management
  • High bargaining power with suppliers
  • Minimization of overhead and operational costs

Moreover, the results of enacting these strategies are the realization of low operational costs passed to the consumer through competitive prices.

As a result of the low cost of merchandise, Walmart attracts customers in new markets to shop at newly established stores.

How Is Walmart Expanding Internationally?

How Is Walmart Expanding Internationally?

Walmart is expanding internationally by setting up stores under different banners in new markets.

Currently, Walmart’s international operations include 5,224 stores in 23 countries outside the US, with wholly owned operations in the UK, Canada, Brazil, and Argentina.

With approximately 2.2 million employees, Walmart prides itself as one of the largest private employers in Mexico, Canada, and the United States. 

However, to achieve success in the international market’s Walmart indulges itself in the following critical activities:

Conducting An Internal Business Audit

Walmart ensures that internal variables such as service types, product offerings, and overall brands are market-ready for domestic and international markets.

In this internal auditing, the company analyzes its SWOT, the gaps, and market segmentation to understand the strengths, possible growth areas, and differentiating value propositions.

Conducting A Competitive Analysis

Walmart vets the business offerings and other operations relating to industry competition in a new market.

With that, once the company concludes the competitive areas in the market, it devises business plans with strategies that curb any aggressive competition within new markets.

Conducting A Market Analysis

For Walmart to excel in new markets, it researches the health and landscape of the new target market.

Then, the market analysis ensures market size and potential of growth, consumer attitudes, consumer bases, market channel research, state of the economy, and market investment analysis.

Setting A Marketing Strategy

Walmart employs a feasible marketing strategy in determining the brand positioning, marketing channels, the delivery of products and services.

In addition to this, the marketing strategy outlines different marketing programs and pricing evaluations based on the economic environment of new markets.

Localized Infrastructure Plans

Walmart outlines the needs and methods of building a compliant local and regional presence for effective international growth strategies.

The localized infrastructure plans include:

  • The positioning of a physical base or facility
  • Hiring international executives and employees
  • Finding local vendors, legal regulators, and tax statuses

Creating A Top-Down Budget

Walmart dedicates launch resources that run the business for a while before it runs as an entity.

Further, the success of the international stores is supported by the expansion of the initial budget for at least three years of continual support, during which Walmart tracks the budget-based KPIs monthly.

Setting Expansion Timelines

Walmart expansion strategies rely on feasible and competitive timelines that provide commitment dates that map out the entire expansion period.

Also, the timelines and feasibility of the set commitment dates usually synchronize with Walmart’s objectives and initiatives without overshadowing the resource of domestic stores.

How Successful Is Walmart Internationally?

Walmart achieved early success in Canada, Mexico, and the UK but failed with strong market entries into South Korea, Indonesia, Hong Kong, and Germany.

So, while most strategies initiated in new markets have been successful, Walmart experienced challenges in South Korea and Germany and exited both countries in less than ten years.

However, the current international divisions have been strengthened through different strategies to contribute to Walmart’s general approach.

Last year, international division sales amounted to approximately $120.824 billion, which translates to around 23.7% of total sales in the company.

Through different expansion strategies, Walmart takes a multi-local and tailored approach in bringing valuable businesses to communities that need them.

Furthermore, these operations have led to the employment of 1.6 million associates in the US and many more worldwide.

If you want to know more, you can also read our posts on Walmart’s cost leadership strategy, Walmart’s supply chain strategy, and Walmart statistics.

Conclusion

In conclusion, Walmart utilizes an international expansion strategy to grow beyond domestic operations and penetrate new markets outside the United States.

With the integration of secondary growth strategies, the company has opened and operated new stores in foreign markets, ultimately increasing Walmart’s revenue.

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Marques Thomas

Marques Thomas graduated with a MBA in 2011. Since then, Marques has worked in the retail and consumer service industry as a manager, advisor, and marketer. Marques is also the head writer and founder of QuerySprout.com.

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