International Business Strategy research project for WalMart potential in Philippines

1. Team 3 Cohort 54
Robert Hughes
Christina Roc
Rich Sluys
George Vernia

2. Sam Walton Ranked 14th largest company
• First Wal-Mart opened 1962 in world
• Pioneer of low prices to small cities
• Estimated 2.1 million associates 1. JP Morgan Chase
2. General Electric
3. Bank of America
4. ExxonMobil
5. ICBC
• 2nd largest company in the world 6. Banco Santander
• 2nd largest employer in the U.S.A. 7. Wells Fargo
• 2nd largest employer in Canada 8. HSBC Holdings
• Largest employer in Mexico 9. Royal Dutch Shell
10. BP
11. BNP Paribas
12. Petro China
13. AT&T
14. Wal-Mart Stores
Sales & Stores
• $258B in sales – 2009 15. Berkshire Hathaway
• 5236 stores/14 countries
• 730,000 associates worldwide Source: Forbes – the Global 2000, April, 21, 2010
• Supercenters, discount stores, Sam’s
Source: http://walmartstores.com/AboutUs/297.aspx
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3. • Present in 14 Walmart is bigger than Carrefour,
countries with 5236 Metro AG, and Tesco combined
locations worldwide
• Walmex in Mexico
• ASDA in UK
• The Seiyu Co. Ltd in
Japan
• Best Price in India
• Wholly owned
subsidiaries in
Argentina , Brazil
Canada, Puerto Rico
• Many other Latin and
South American
locations.
Source: http://www.answers.com/topic/wal-mart-stores-inc (January, 2011)
Source: http://prudentinvestornewsletters.blogspot.com/2009/01/from-
deloitte-2009-world-largest.html
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4. Choose Country
Determine Specifics of the
business environments
Source: http://rw-3.com/?s=wal+mart
Source: http://www.mariarogal.com/weblog/wal-
mart-takes-over-the-world/
Decide Entry Strategy
Acquire an Existing Player
Joint Ventures (Mexico, India, Brazil,
Green Field Operations (Germany, Canada, UK, South
Honduras, Guatemala, El Salvador, Start New Stores on Own
Nicaragua, Costa Rica),
(Argentina,, China) Korea, Puerto Rico, Japan, South
Africa, Chile)
Source: http://walmartstores.com/aboutus/246.aspx
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5. • Area: 300.000sq km (slightly less than the US)
• Capital City: Manila
• National Currency: Peso (fx 42.5 to 1 USD)
• Population: 101,833,938 (July 2011 est.)
• Population Manila: 11,449,000
• President: Benigno AQUINO (June 30, 2010)
• Ruling Party: Democratic
• GDP: $351.4Billion –PPP (2010 est.)
• GDP Growth: 7.3 % pa (depends on source)
• GDP per capita: $3.500 (2010 est.)
• GDP by sector: agriculture: 13.96%, industry:
31.3%, services: 64.8.6% (2010 est.)
• Population below poverty line: 32.9% ($90/yr)
• Industrial production growth rate: 11%
• Foreign direct investment: $147 billion in 2008
• Education expectancy: 12 years average
• Literacy: 92.6%
• Ethnicity: Tagalog, Cabuano, Iiocano,
Bisaya/Binisaya, Hiligaynon Ilonggo, Bikol,
Wara, Other
• Religion: Roman Catholic 80.9%, Muslim 5%,
Evangelical 2.8%, Iglesia ni Kristo 2.3%,
Aglipayan 2%, other Christian 4.5%, other 1.8%,
unspecified 0.6%, none 0.1% (2000 census)
• Terrorist activities generally limited to
Source: CIA and World Bank southernmost regions
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6. • Population: 7,832,000 (2010)
metro (636 sq km)
• Percentage of national
population: 24.6%
• Per-capita GDP US$2,000, has
grown from $1000 (yr 2001)
• Top 5 Richest cities in Manila
• Makati $29,259 GDP per capita
• Mandaluyong $20,258 GDP per
capita
• San Juan City $16,893 GDP per
capita
• Muntinlupa $13,789 GDP per
capita
• Manila $13,731 GDP per capita
• Inflation 3.8%
• Good public transportation
• Highly educated population
Source: http://www.adb.org/documents/books/ado/2011/ado2011-phi.pdf
Source: CIA World Factbook Philippines
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7. Source: http://www.adb.org/documents/books/ado/2011/ado2011-phi.pdf
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8. 8

9. S Strengths
W Weaknesses
• Efficient supply chain management
• Targeted marketing • Public image often poor
• Service innovation and technology • Inability to adapt in some countries
• Growth through adaptability. • Union/nonunion labor laws
• E-marketing strong • Unskilled media relations
• Strong penetration strategies • Constant law suits against the
company.
• Infrastructure (financial strength)
• Low penetration in European union
T
Opportunities Threats
O
• Globalization (diminishing trade • Terrorism in country exists
barriers)
• Many competitors
• Increase in consumer purchasing
• Barrage of negative publicity
power
• Anti-competitive campaign practices
• E-business
• International laws against dumping
• Improve employment
Source: Cohort 54 Team 3 Discussions
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10. Source: http://www.foreignpolicy.com/articles/2009/10/19/the_wal_mart_effect
November/December 2009 Foreign Policy – Author Michael Wilkerson
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12. Tremendous Large market and growing. Consumer class (particularly in
Market urban areas) very affluent.
GDP/Per capita incomes growing rapidly and in positive
Economy directions. Consumer spending, especially in credit cards
increasing.
Filipinos enjoy American goods. Many have visited America.
Cultural Looking for variety, customer service, low cost.
Stable government, laws conducive to good business
Government
practices.
Financially Walmart is financially stable, well-funded enterprise. Has
stable enjoyed reasonable successes in overseas endeavors.
Source: Team 3 Cohort 54 discussions
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13. Source: Google Images www.CartoonStock.com
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