Wal-Mart Finds That Its Formula Doesn’t Fit Every Culture

Wal-Mart executives eventually realized that requiring employees to smile at customers or participate in the “morning Wal-Mart chant” at its German stores did not mesh well with either the staid employees or customers. Differences in corporate and national culture, combined with competition from local discount vendors, hampered success of the giant US retailer, which left Germany after eight years. Still, Wal-Mart International is committed to expanding business outside the US, and learned some lessons from its failures. The company is more flexible in dealing with employee unions, hiring locals as managers and no longer insisting that acquisitions abroad bear the Wal-Mart name. Wal-Mart also carefully researches any local chains that it acquires, making sure that location and size offer immediate impact in new markets. Despite some failures, including attempts to sell ice skates in Mexico, 2005 sales for Wal-Mart International grew at double the rate of US stores. – YaleGlobal