Contemporary issues
The most common contemporary issue that Wal-Mart faces internationally is that it faces opposition on every attempt to open or expand their goods and services to Africa. The idea of introducing Wal-Mart into Africa has threatened local retailers arguing that they would not be able to cope with it set volumes and prices. Some people denounce Wal-Mart regards it as a corporation that to pay its employees paltry salaries and wages. This move is of significant impacts to the local retailers because Wal-Mart would create jobs and improve the current survival state of small and upcoming local retail (Vedder, 2006).
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Mexico is a broad foreign market for the company. This has made it to dominate within the country’s economy and as a result, issues arose as to how it acquired its construction permit. It is believed that Wal-Mart obtains its construction permit through bribery of a lump sum of $24 million. It is also in the records that Wal- mart is subject to criminal probe for their employees are violating the Foreign Corruption Practices Act. The company is alleging to have paid the Mexican government to issue approval permits thus giving them a way into the market more easily without undergoing a normal routine for acquiring them (Vedder, 2006).
Wal-Mart has encountered difficulties in making the decision of whether to adapt to the strategies that were there from the past in facilitating a smooth management process. This therefore, contributed to the haphazard increase of sales and growth of the net income throughout the entire stores in the world. It adopted low cost leadership strategy to outshine all its competitors and emerging as the most effective and efficient company in the retail industry (Vedder, 2006).
Effects on the international financial management for Wal-Mart
Facing opposition from Africa has affected its international market share and relation because majority of the world’s biggest retailer view Africa as a major target market. It therefore means that the contemporary issue disadvantages Wal-Mart since its competitors gets to cover more ground while it tries to find a remedy for the challenges. Allegation of bribery is another key factor that is destroying the good reputation of Wal-Mart. Many potential investors and customers tend to disengage themselves from Wal-mart on grounds that it is involved in unlawful activity that is affecting its international image (Vedder, 2006).
In conclusion, all this issues combine, has an impact on the international management for Wal-Mart in that, decision making progress is manipulated and managing all international branches become a bit difficult. It involvement in bribery brought financial inconvenience because fund were misappropriate in conducting unlawful action.
References
Vedder, R. K., & Cox, W. (2006). The Wal-Mart revolution: how big-box stores benefit consumers, workers, and the economy. Washington, D.C.: AEI Press ;.
