...in Germany. Wal-Mart had entered the German retail market in 1997, with the acquisition of the failing German retail chain Wertkauf, and had quickly encountered problems. Wal-Mart’s EveryDay Low Price (EDLP) guarantee, inventory control, and efficient distribution strategy, so strong in the United States, had each been a source of headaches. Wal-Mart went through protracted struggles with labor unions, with suppliers, and with local zoning boards. It also weathered a major pricing scandal, had been fined for failing to return used bottles to producers, and, in a case that was on appeal at Germany’s constitutional court, faced a 330,000 euro fine for failing to release financial data for Wal-Mart Germany. This was not the first time that Wal-Mart International had run into problems with overseas expansion. It had quickly pulled out of Indonesia after a disappointing ‘test project’ in the early 1990s. Yet in most cases, time had worked in its favor. In Mexico, where it was now recognized as the country’s leading retailer, Wal-Mart had needed five years to post profits. In the United Kingdom, which Wal-Mart had entered by acquiring ASDA in 1999, it was already enjoying double-digit sales growth. Could this success be duplicated in Germany? Wal-Mart: Brief Background Founded by Sam Walton in 1962 in Bentonville, Arkansas,...
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