3) What are Wal-mart’sWal-Mart’s

Do’sdo’s and Don’ts to guarantee its success

in ChinaTrung Quốc and India?

A) In ChinaTrung Quốc:

1. Advantages:

ChinaTrung Quốc – the most populous country in the world – has such an

attraction that can notcannot be ignored. According to “The Art of War” by Sunzi, if

Wal-Mart can take advantages of 3three factors: “Opportunities, location, and human

support”, they will succeed by any circumstances, or else they will be low-

developedlow ,developed or even fail. The case can be analyzed as below:

1.1. Opportunities:

Coming on time is better than coming early, ChinaTrung Quốc is a potential

market which is welcoming foreign investors after decades of isolation. Wal-

martWal-Mart jumped in it when the period of reforms byreforms by Deng Xiaoping

had just been taking place.

Before Wal-Mart’s appearance, ChineseTrung Quốc national retailers mostly

provide a limited number of goods whichgoods, which is often low quality, and most

stores are sombresomber, dirty, and disorganized. At that time, people have a saying,

“The early bird catches the worm” which means only the earliest has the chance to

purchase items. As a result, this is a good opportunity.

1.2. Location:
 Wal-Mart set the first headquarter in Shenzhen because of the two following

advantages:

- Deng Xiaoping, the former ChinseTrung Quốc President, had a motto “It’s a

good cat as long as it catches mice.” Shenzhen city was the first special economic

zone whichzone, which initially piloted open-market reformation of ChinaTrung

Quốc. The city received preferential treatment from ChineseTrung Quốc government,

which was favorable for enterprises’ investment.

- Shenzhen, the fifth largest port city in the world, is located near Taiwan,

Macau, and Hong Kong – One of the four Asian dragons of economics.

Wal-Mart is one of the big enterprises which soon invested in ChineseTrung

Quốc market had the priority to occupy "the most advantageous location" of large

cities.

In October 2006, Wal-Mart has outbid other competitors whichcompetitors,

which are Carrefourare Carrefour from France, Tesco from Britainfrom Britain and

Lianhua fromLianhua from ChinaTrung Quốc. The most important milestone was

that Walmart bought Trust-mart whichmart, which was the largest ChineseTrung

Quốc hypermarket at the price of $ 1 billion . billion. In the line of agreement, 101

stores will continue to operate under the Trust-Mart trademark. Wal-Mart vice

chairman Michael Duke said: " we have the opportunity to strengthen our presence in

ChinaTrung Quốc which is the world`s fastest growing retail market by investing in

Trust-mart .mart(. (Source:

http://www.tin247.com/walmart_quyet_xam_chiem_thi_truong_trung_quoc-3-

21293257.html)
 Trust-Mart operates 101 shopping centers and supermarkets

( including(including franchise stores) in 20 provinces of ChinaTrung Quốc. Trust-

Mart's turnover in 2005 was 1.67 billion, while Wal-Mart had revnuerevenue of only

$ 1.3 billion in the ChineseTrung Quốc market. Carrefour's revenue in 2005 was over

$ 2 billion. Wal-Mart planned to buy 31 of the Trust-Mart stores and gradually raise

the percentage of stock ownership in the company.

According to observers, the acquisition betweenacquisition between Trust-mart

and Wal-martWal-Mart will enable this group to become the biggest retail system and

inventory in ChinaTrung Quốc. At that time, Wal-martWal-Mart will become number

one, exceeding Carrefour and Tesco. (Source:

http://www.marketingchienluoc.com/index.php?

option=com_content&view=article&id=993:giau-nht-nh-ban-hang-r-nht-vn-ra-th-

gii&catid=39:articles&Itemid=12)

1.3. Human:

ChineseTrung Quốc officials are the ones who cherish big dreams to reduce

thereduce the poverty of the country. Wal-martWal-Mart is one of five hundred

world’s leading companies investing in ChinaTrung Quốc. Its mission is to change

ChineseTrung Quốc business philosophy, science, technology and backward

management experience. Therefore, Wal-mart is always warmly welcomed by

ChineseTrung Quốc officials and mediaTrung Quốc officials and media always

warmly welcome Wal-Mart wherever it comes. (Source:

http://finance.qq.com/a/20080125/002347.htm)
 Wal-mart’sWal-Mart’s presence in ChinaTrung Quốc has created new jobs for

local residents. Appearing in Shenzhen, ChinaTrung Quốc since 1996, Wal-martWal-

Mart has established 60 shops and 80 retail branches in 34 cities.

Wal-Mart also have the intention of opening more stores in 2007 while

increasing the labor force from 36.000 to 150.000 next year. (Source:

http://niemtin.free.fr/banlethegioi.htm)

One of the reasons for Wal-Mart’s preference is because they are tactful in

earning the ChineseTrung Quốc’s heart. From the first step into ChineseTrung Quốc

retail market in 1996, Wal-Mart has given donation in cash and kind to poor regions

of more than 600 millionsmillion yuanYuan. The staffs of Wal-Mart have done the

community service for more than 180.000 hours as well. (Source: http://www.wal-

martchinaTrung Quốc.com/walmart/wminchinaTrung Quốcinfo.htm)

2. Difficulties and challenges

The ChineseTrung Quốc retail market, with the size of more than 840

billionsbillion USD, is now in a fierce competition especially after Beijing has

removed the barrier for foreign retailers as a commitment to WTO. Therefore, Wal-

Mart may not keep its domination if it does not have an effective operation.