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  • January 2006 (Revised December 2006)
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Wal-Mart's Business Environment

By: Felix Oberholzer-Gee
  • Format:Print
  • | Pages:14
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Abstract

In 2004, Wal-Mart Stores, Inc. proposed to build a new supercenter in Inglewood, a low-income community near Los Angeles. The proposal was a part of Wal-Mart's strategy to bring its supercenter format to California. Introduced in the late 1980s, supercenters added a full line of groceries and specialty departments to Wal-Mart's traditional assortment of general merchandise. Wal-Mart's planned entry into California caused problems even before the discounter opened a single supercenter. To compete with Wal-Mart, supermarkets in California cut grocery workers' health benefits and wages. The unions ordered a strike against the supermarkets. The labor unrest lasted five months and involved 70,000 workers. In the meantime, Inglewood's city council rejected Wal-Mart's request to build a supercenter. The retailer took its expansion plans directly to the voters of Inglewood. With the help of the California initiative process, Wal-Mart forced a public vote on the proposed 60-acre development. Will Inglewood's voters dampen the shine of "America's most admired company?"

Keywords

Goals and Objectives; Expansion; Market Entry and Exit; Corporate Strategy; Labor Unions; Conflict and Resolution; Retail Industry; Los Angeles

Citation

Oberholzer-Gee, Felix. "Wal-Mart's Business Environment." Harvard Business School Case 706-453, January 2006. (Revised December 2006.)
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About The Author

Felix Oberholzer-Gee

Strategy
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  • Coca Cola İçecek—Managing a Sudden Turbulence By: Felix Oberholzer-Gee, Namrata Arora and Gizem Cihan Dincsoy
  • Tesla Motors in 2024--Turbulence Ahead? By: Felix Oberholzer-Gee and Kate Stoppiello
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