This Post is about the Top Reasons for Walmart failure in Brazil (accompanied with Video Guides), Conclusion and Lessons Learnt from that Failure
Walmart Failure in Brazil Learning Video Guide 1
“Walmart operates more than 11,000 locations across 27 countries. In June 2018, Walmart sold 80 percent of its stake in Brazil, a country where it once had 558 storefronts at its peak. Watch this video to find out why the American retailer had to pull back from the Brazilian market.” – CNBC
Why Walmart Did not Succeed in Brazil ?
Present in 24 countries and employing over 2 million people, Walmart is not only the largest retailer in the world, but also, in the general ranking, the company with the highest turnover in the world. Its founder, Sam Walton, built an empire, left a legacy and also a lot of wealth. His third generation heirs are considered the richest family in the world. In this video, however, we will unravel the reasons that led Walmart to fail in our country. From its rise to its fall, we’ll see why, despite having a lot of economic power, the American giant didn’t succeed in Brazil.
Inteligência Visionária
Walmart failure in Brazil Learning Video Guide 2 (Portuguese Video with English Subtitles)
Conclusion on Why Walmart Failed in Brazil :
- Lack of understanding of the Shopping Behaviour of the Brazilian Consumers (who are not Exactly Similar or exhibit similar Purchase Pattern like US Customers)
- Overall Lack of Understanding of the Local People and Local Culture which also resulted in Labour Troubles.
- Walmart Struggled to Compete with more Established Supermarket Chains (uncompetitive pricing, lack of people and culture understanding, overall inefficiency in the store operations – all contributed to this)
- Inefficient Store Operations – Lack of Adequate and Effective Customer Service, Ineffective Strategies to deal with Stock-outs and Supply Chain Issues also dealt a setback to Winning the Brazilian Customers
- Ineffective Sales Strategies that could not lure customers from the Local Competition (Local Supermarkets who were more successful)
- Poor Store Locations affected Customer Turnout in the Malls
- Walmart Did not adapt its Pricing to the Local Market
Lessons Learnt from the Walmart Failure in Brazil as mentioned by Nelson Fraiman (Professor, Columbia Business School)
Firms in North America are getting better, but still aren’t very good at learning about local cultures. Large firms like Wal-Mart have gone to countries like Brazil and failed — the same way they’ve gone to countries like Korea and failed, the same way they’ve gone to countries like Germany and failed — mainly because of not understanding the local culture.
The U.S. can become better at learning about the people and working together as equals, rather than imposing a series of systems and procedures that work here, but don’t necessarily work there. Little details do matter. If a country like Germany doesn’t like to smile, then don’t smile when you say have a good day. Little details are what usually kills American companies that forget to pay attention.
A lot of these entrepreneurs grow locally, and they’re not aware of what it means to compete globally. If you want to get better, you have to shape up in your processes before you can think of going global.
Nelson Fraiman (Professor, Columbia Business School) in a CBS News Report
