Walmart is one of the leaders of the global retail industry, ranking as number one in the Fortune 500 list of companies. In spite of its worldwide presence, the company’s operations are centered around the market of the United States. In this country, Walmart is spread nationwide, providing millions of customers with an array of products at a good value. The company’s enhanced presence, combined with its reputation among clients, has secured its leading position in the United States, and this status translates into overseas success. At the same time, each major company that seeks to transcend the local level has to operate in a highly complex environment with different interrelated features that may impede the sustained growth of the business. As such, it appears valuable to review the operational context of Walmart in relation to its current position and the future.
First of all, the company’s center of operations revolves around the United States as its key market. This country is generally characterized by a considerable level of development, which secures the purchasing power of the target audience. The local environment is highly familiar for Walmart, and vice versa. More specifically, customers know what offers they may expect from Walmart, which remains a reliable brand for them across the nation. In terms of politics, the United States is a developed democracy that is often taken as a reference by foreign systems. Nevertheless, the past years have been characterized by an increased level of uncertainty, as well as heated political debates.
Amid this situation, Walmart has been able to retain its position due to its long history of endurance and ability to adapt to the changes in both political and economic environments. As the company’s CEO states, the ability to change is one of the key features that define Walmart as a successful, steadily growing organization (Walmart, 2020). However, the international presence of the company sees additional difficulties from the political and economic perspectives. For example, Walmart has faced an array of difficulties in terms of its operations in China (Li & Liu, 2018). When aiming at an international presence, each company is expected to show a certain degree of flexibility to adapt to the local rules of trade and legislative frameworks. If these requirements are not met, the governments are likely to interfere, putting additional stress on the operational environment. Under such circumstances, the company’s resilience sees additional importance. Even though Walmart’s challenges in such areas as China have been significant, the company still retained its leading position worldwide. Its continuous expertise in other areas compensated for losses in this particular part of the globe.
In 2019, the performance of Walmart was on par, as compared to the previous trends. Table 1 shows a comparison of the reported figures between the years 2018 and 2019. As can be seen from the data, Walmart retained its steady growth in sales and revenues in 2019 as a result of a stable performance. That year, the global economy remained on the increase, with the major players of G20 expanding their shares of the over $ 133 trillion turnover (Hamadeh et al., 2020). The rise of the GDP per capita in most G20 nations contributed to the purchasing power of the world’s population, which helped Walmart accumulate better returns. Within the framework of political and economic stability, the company secured its leading position, finding better opportunities for innovation and growth.
Table 1. Walmart’s Financial Performance in 2018-2019 (Walmart, 2020).
|Return on assets||6.29%||3.11%|
|Return on equity||8.9%||12.7%|
Hamadeh, N., Yamanaka, M., & Purdie, E. (2020). The size of the world economy in 2019: A baseline from which to measure the impact of COVID-19 and track economic recovery. World Bank Blogs.
Walmart. (2020). 2019 annual report. Web.