interoffice memorandum to: | [Recipient Name] | from: | [Your Name] | subject: | [Subject] | date: | [Click to Select Date] | cc: | [Name] | | | 1. Business Level Strategy a. Wal-Mart’s initial business strategy used in foreign markets in the early 1990’s was to use a focus low cost approach. By creating a very efficient and effective distribution channel they are able to price their products low. Their marketing strategy of “Ever Day Low Prices” relates to their business level strategy by providing low prices in the specific geographical region they were going after. An example of this is made clear when they decide to enter into a foreign market; they focus on only that country, not surrounding ones. They decided which penetration approach would require the least investment cost. b. Local competitors in Brazil responded to Wal-Mart’s arrival by lower their prices as well, initiating a price war and creating losses. Competitors remained profitable by continuing to sell the leading category, food, and pricing them competitively. Advantage for them was having a long relationship with the local suppliers. Wal-Mart continued to use focused low cost approach as their business level strategy to compete but also stressing their customer service enhanced by its policy for hiring and promoting. c. When expanding to Germany, the supply chain management issues impacted the company’s business level strategy by the resistance to switch to a new supply system. In the resistance there was often empty shelves found. Wal-Mart management greatly underestimated the difficult of penetrating this market. A ratio that can help in evaluating inventory management is inventory turnover, and days in inventory. This way we are able to see how many times we are able to get ride of our inventory every year, as well as how long our inventory stays sitting