Wal-Mart Case Study: Fsa's Strategies
Wal-Mart case 21-22-07 Amber Nan Hu S2811995 Germen Nuis S2947633 Stef Lips S2968649 1. What are some of Wal-Mart’s FSA’s? To what extent are these FSA’s location bound or internationally transferable? The firm specific advantage of Wal-Mart is based on its services and cooperate culture. Wal-Mart has basically two FSA’s in our opinion. The first FSA is the strategy that they are implementing in their daily operations. This strategy is the ‘’everyday low prices’’ or just ‘’EDLP’’. They use the loss-leader strategy to lure more customers to their stores. The other FSA is their ‘’exceptional services’’, which basically means that all their employees need to be customer friendly. They need to smile to a customer if they are …show more content…
They thought that they could transfer their strategies, which were very successful back in the United States, to Germany and that it would automatically work just as successful. The strategies are the ‘’Everyday Low Prices’’ or ‘’EDLP’’ and the ‘’exceptional services’’. Both FSA’s turned out to be not as transferable as they thought. The EDLP did not work, because Wal-Mart Germany could not implement their loss-leader strategy. This strategy was prohibited, because of the German fair trading and anti-trust laws. These laws prevented Wal-Mart from reducing the price of the products below their costs to attract more customers. The other FSA, the ‘’exceptional services’’, was not a success, because also in this case they struggled with the differences between American thinking and German thinking. Wal-Mart had the policy were they would smile to customers when they were in close proximity. About 10 feet to be precise. In the United States the customers reacted to this as very pleasant. In Germany the customers thought entirely different. Some thought it was way to flirty and some even filed harassment
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