To start with, factor endowments in the United States are very high being that the nation is amongst the most developed, if not the most developed, hence access to exceptional infrastructure amongst other necessary resources. The country’s level of organization through labor unions is also a noteworthy aspect that provides the needed support to propel the country’s production and product marketability hence growing the overall Gross Domestic Product (GDP). The nation’s large population in its notable organization provides the driving force particularly for the company’s manufacturing and production endeavors. Local demand conditions, which are moderate, ensure that the company’s wholesale and retail industry of consumer goods remains afloat
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Competencies particularly related with Wal-Mart’s success include; an integrated tech supply chain, the capability to generate huge sales volumes, decentralization of operations, loftier logistics system, effective management practices within all branches notwithstanding the involving management style between the headquarter and individual stores. When observed individually, these competencies are mere competitive advantages, but together they act as a sustainable core aptitude for Wal-Mart’s evident profitability. Their investment in high technology limits other competing companies from doing so as they would require a lot of money for installation of systems remotely close to those of Wal-Mart. Their production levels also make them a huge firm to compete with particularly as they gain bargaining power for their inputs. Vertical and horizontal communication between all of Wal-Mart’s stores facilitate enhanced effectiveness and employee relations further improving their productivity …show more content…
Local suppliers, cost dissimilarities, and the absence of their efficient supply chain management systems could pose considerable challenges in implementing the US operation model in China. Factor endowments such as monetary employee reward systems could fail to work in China as they do in the US because the cultural diversity bends them towards valuing different motivators, which require research to tailor in the Chinese markets for success. The cultural distance between the US and Chinese markets highlight the impossibility of applying similar operation models. For instance, Chinese people perceive commercial shopping as a leisure unlike in the US where it is a basic need for the purchase of day-to-day products including foodstuff. Furthermore, they prefer to buy smaller quantities more frequently being that they live in grouped populations thus increasing service cost allocated to each customer as compared to the US where customers prefer to buy in
Competencies particularly related with Wal-Mart’s success include; an integrated tech supply chain, the capability to generate huge sales volumes, decentralization of operations, loftier logistics system, effective management practices within all branches notwithstanding the involving management style between the headquarter and individual stores. When observed individually, these competencies are mere competitive advantages, but together they act as a sustainable core aptitude for Wal-Mart’s evident profitability. Their investment in high technology limits other competing companies from doing so as they would require a lot of money for installation of systems remotely close to those of Wal-Mart. Their production levels also make them a huge firm to compete with particularly as they gain bargaining power for their inputs. Vertical and horizontal communication between all of Wal-Mart’s stores facilitate enhanced effectiveness and employee relations further improving their productivity …show more content…
Local suppliers, cost dissimilarities, and the absence of their efficient supply chain management systems could pose considerable challenges in implementing the US operation model in China. Factor endowments such as monetary employee reward systems could fail to work in China as they do in the US because the cultural diversity bends them towards valuing different motivators, which require research to tailor in the Chinese markets for success. The cultural distance between the US and Chinese markets highlight the impossibility of applying similar operation models. For instance, Chinese people perceive commercial shopping as a leisure unlike in the US where it is a basic need for the purchase of day-to-day products including foodstuff. Furthermore, they prefer to buy smaller quantities more frequently being that they live in grouped populations thus increasing service cost allocated to each customer as compared to the US where customers prefer to buy in