Obstacles Of Retails To Globalization

Submitted By Just4FunHigh5
Words: 663
Pages: 3


The article attempts to underline the main obstacles of retails to globalization and some different solutions. The first part talks about the pressure to globalize and some main reasons include: greater economies of scale and scope, a need to diversify risks, a desire to attract fresh talent and create new opportunities for existing leaders, and a need to make up for constraints imposed by regulatory agen- cies in homemarket. However, it is difficult for the retailers to globalize and increase profit by investing abroad. There are a lot of factors that influence retailers’ globalization strategies. Eventhough a great number of retailers failed to go gloabal, a few have succeeded by developing strategies that apply four rules for globalization. Rule 1: The home market is the linchpin. Rule 2: Always bring something new to market. Rule 3: Differentiation is more important than synergies. Rule 4: Timing is critical. In my opinion, the globalization for retailers is a long-term strategy. In most of the countries, the local retailers still dominate and international players are absent form the large retail market in the local country. As rule 1 said, the home market stays critical to the retailer’s performance. Therefore, the retailer need to strong its market position at home first to have a better chance of going global. I aslo think after the retailer develop its market position and reputation in its own country, the good image will spread to the world which may help its development in other countries. Second, retailers should not centralize all their actions in the foreign market, leaving their principal home market on the side. They have to know that the strength are from their home market and they need to perserve it. Therefore, Retailers needs to rethink their attitudes to globalization and plan good strategies. Most of the retailers tend to go abroad without a good globalization strategy. The second rule is that you need to bring something new. I think it is also a very import step to go global. It is impossible to succeed if you don’t offer some element of novelty compared to the already-implanted chains. For example, when Walmart entered into Chinese market, they brought the new idea “fresh” and brought the wet market indoors. During that time, the wet market and supermarket is separated, so people need to go different markets to get their stuff. Now, people can shop in Walmart and pick out their own dinner which attact a great number of customers. Moreover, in today’s world, people are more concerned