Walmart
The biggest company with the biggest failure
“Shoppers there are very price-conscious and the competition essentially out-Walmarted Walmart”
Jon Jacobs, an analyst at Cantor Viewpoint in New York explained. Walmart had seen their amazing success in the US as proof that they could take on the world, but they couldn’t.
Walmart had a genius system.
A low price system to draw customers in and excellent customer service to keep them coming back for more.
They designed the aisles to perfectly flow throughout the store. You can see the flawless design, as you pass by the lush smell of bread and cakes, hearing the chimes from the trolleys. Walmart has a unique feel.
So why did it fail in Germany?
Upon its arrival in Germany, it was under pressure for its low price system. They faced many accusations stating that Walmart was using short-term predatory pricing to put small shopkeepers out of business.
At the same time, Walmart could not compete against outdoor markets, where prices were so cheap, that the market stalls would hardly make a profit.
They had out-Walmarted Walmart
Furthermore, Walmart’s customer service was not-so-excellent in Germany. It was the same as the US’ customer service and that was the problem.
The Germans felt that the employees were intruding on their personal space. The Germans were completely capable of handling their groceries, and many male customers believed that the smiling clerks were flirting.
The Germans were freaked out!!
On top of that, Walmart did not pay enough attention to the unions. Secretary of the Verdi union, Hans-Martin Poschmann said
“They didn’t understand that in Germany, companies, and unions are closely connected… they thought we were communists”
All of this meant that Walmart completely failed in Germany. They left having lost $1 billion.
If you are interested, I will leave a few fun facts about Walmart in the comments. I hope you enjoyed the story!!