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Services Geography Global stimuli OUTLINE

Outsourcing definition Outsourcing can be done domestically or abroad and always involves work done externally.

outsourcing Benefit Drawback

Benefit Less capital expenditure Less management headache Focus on core competencies

Drawback Less managerial control Outsourcing company goes out of business May be more expensive

walmart’s outsourcing

OUTSOURCING FACT manufacturers outsourcing 70% merchandise Chinese component. global leader of outsourcing.

EXPANSION OUTSOURCING profit

Content: Efficiency

Services Financial services Insurance and real estate Transportation and communication

Financial services Payroll check cashing Money orders Money Transfers Bill payment Walmart branded credit cards

Insurance and real estate Credit card and billing services Balance Protection Plan Extensive Coverage through every Stage of your Life Unbeatable Price for all this Protection Additional Details of Coverage

Transportation and communication Safety Economic competitiveness, State of good repair, Livability Environmental Stability

GEOGRAPHY  Wal – Mart: _ comprise 4,263 stores ; 660,000 workers in 15 countries outside the US. _ ranked No.2 (Fortune 500 list of largest companies in America 2009) _ add to the more than $400 billion in annual company revenues. _ sales were $100 billion, or 24.7% of total sales (2010). VariedStrategy HOWEVER series of acquisition (Germany, Argentina, and Canada). Wal-Mar hypermarkets (Mexico and China)

 WAL-MART try to: _ Satisfy customer’s needs. _ Company’s unique culture and effective retailing concepts  each new countries. How could Wal-Mart be so successful overseas ? Wal-Mart go overseas adapt to local cultures become involved in the local community GEOGRAPHY

- Wal-Mart has been able to run an international business, maintaining the advantages of huge economies scale and buying power, whilst at the same time being flexible on the local level. Glocalisation and the success GEOGRAPHY

Canada Mexico NORTH AMERICA CENTRAL AND SOUTH AMERICA Brazil Chile

Russia UK EUROPE ASIA ChinaJapan

WHY?

CHINACHINA  >= 80% of Wal-Mart’s Global Suppliers Are Based in China  Imports Could Be As High as $30 Billion A Year  70% of Goods Sold at Wal-Mart Contain Components Manufactured in China  8 th largest Trading Partner.

Growth in technical education Cheap Labor Language Labialisation of laws and government policies Existence of offshore manufacturing and physical proximity to major markets

In March 2004, Business Line reported that Wal- Mart intends to outsource $11 billion in textile merchandise over the next few years. Wal-Mart Operates an 80 Person Sourcing Office in Bangalore. Wal-Mart Is Increasing Purchases From India By 30%. INDIAINDIA

High-quality and cost-effective services High-end technology and best-of- breed infrastructure Skilled, talented and experienced professionals Wide range of services Save on time, effort and infrastructure Latest software and technologies

GLOBAL STIMULI Distribution of labour:  The largest private sector recruits and uses the amount of employment all around the world.  Provide the great number of jobs.  For any position and hierarchy: manager, accountancy, research & development, marketing & advertising, public relations.  Decrease the proportion of unemployment and solve the career problem.  Enhance the world economy.

International Trade:  Leave with radical reductions in fixed assets and exuberant dark store expenses related to the discontinuance of the international stores  60% of Wal-Mart products are imported from such countries as fast-growing South Korea, Philippines, Malaysia, Cambodia, Thailand and Vietnam.  The company's biggest trading partner is China.  Sales from stores outside the U.S. are growing faster than Wal-Mart's American retail operations. GLOBAL STIMULI

Income of workers Impact on Wal-Mart workers Impact on Wal-Mart Shoppers GLOBAL STIMULI

Impact on Wal-Mart workers: What if Wal-Mart put in place a $10 per hour minimum wage for all its hourly employees in the U.S.? How much would it cost Wal-Mart ? how much of the increase would benefit workers in poor and low-income families? GLOBAL STIMULI

Impact on Wal-Mart Shoppers GLOBAL STIMULI

Not only concerned with the average Wal-Mart shopper, but also with the low-income Wal-Mart shopper How would these low-income shoppers fare if Wal-Mart were to increase its prices to recoup the costs of a wage increase? GLOBAL STIMULI

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