Walmart is an international company with its headquarters in the United States. Even though it is primarily a US company, it also has retail stores in a large number of developed countries around the world. With that being the case, the company has to pay careful attention to the political and other issues seen in different countries in order to remain successful and continue to expand.
International Corporation Walmart
Because of the abilities of the internet and the expansion of global interests, there are many more international corporations today than there were in the past. One of the largest and most recognized of those corporations is Walmart. It operates in nearly all developed countries in the world, and is one of the largest retailers on the planet (Fishman, 2006; Zook & Graham, 2006). While it started out small, the company has grown to enormous proportions. It has become so large that some countries and some communities have taken strong and significant steps to keep the company out. Not everyone is a fan of the company, and not all countries think Walmart is good for business. The way the company comes in and "takes over" is sometimes a problem for much smaller, "mom and pop" businesses that are not able to sell as inexpensively as Walmart. For other communities and countries, having Walmart available to them and provided them with great, low-cost alternatives to their other shopping choices (Ingram, Yue, & Rao, 2010).
The market systems and legal systems that exist in the countries were the corporation operates are all different, but the company most commonly operates in countries with democratic systems (Lichtenstein, 2009). This means that the company can sue and be sued, and that it is innocent until it is proven guilty by having a trial. Generally, communist countries and those with similar structures are not good choices for Walmart because they do not encourage for-profit businesses that are not operated by the government. Walmart remains focused on countries that want it there and that welcome it, as well as countries that have legal systems and market systems in which it can work the most comfortably. Most countries that are highly developed and that are democratic or socialist (i.e. not communist) in nature are "targets" for Walmart, because the company knows that there are people there who want to do business with the retailer and who want to purchase the goods it can offer to them.
The overall effect of the market systems and legal systems in the countries where Walmart has a presence do have an effect on the operations of the company, but they are significant only because Walmart is careful about the countries in which it chooses to do business. Before it moves into a new market, it focuses on the market very carefully and does its research thoroughly (Vance & Scott, 1997). Ultimately, Walmart is out to make money. If it is not able to make any money in a particular market, or if there are market and legal systems that preclude it from doing business in the way it wants to in order to maximize profit, it will avoid that country and move into a different country where it can move forward more easily and where it has a better chance of being successful.
Political risk is another area where Walmart has to be careful. While it may not seem like Walmart is political at all, every country has a political leaning and every country's political agenda could affect companies that are already in the country and that are planning to move into the country. In the United States, the upcoming presidential election will affect Walmart. Depending on who enters the White House for the next four years, the economy may stagnate, get worse, or improve. While the election does not control the entire U.S. economy, there will be a significant effect from it - and that is something companies like Walmart must pay attention to and consider carefully when they think of expanding or making any significant changes to their structure. In other countries where there are no immediate, upcoming elections, the main issue for Walmart is the overarching political climate. In other words, the political posturing and changes that might be taking place in a country have to be focused on in order to determine what may take place in the future.
If the politics of the area are not going well, it is quite possible that the finances of the area will also not be going well. The two are closely tied together for most countries, and right now there is a strong feeling of unrest in Europe, as well as other parts of the world. With that in mind, companies like Walmart must be aware of the political and financial issues that are faced by a company where it is operating or where it is thinking about operating in the future (Fishman, 2006; Lichtenstein, 2009). As a political consultant for the company, it would be recommended that Walmart approach political risk by considering financial risk. The risk that is seen with finances for any given country is sometimes more obvious and easy to detect than the risk that is seen with politics, and since the two are closely tied together they are often good indicators of one another and work well together for companies to determine the potential for success.
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