The Success Story of Wal-Mart in Mexico

However, the company was able to overcome these hurdles because of strong support from the Mexican government as well as common people, who were eager to benefit from Walmex's reputation as a company that offered quality products at affordable prices. Analysts said that in Mexico, protests against Walmex were led by small groups of traders who were affected by the competition on the price front, but these groups failed to mobilize the masses and other activists against the company.

Prior to Wal-Mart's entry into Mexico, people bought their regular requirements from informal street shops, where locally made and relatively cheap products were available.

However, the street shops could not withstand the competition from Walmex as the products they sold were not of the same quality and of the same range as those at Walmex. Organized retailing in Mexico was confined to a few local players like Controladora Comercial Mexicana SAB de CV⁶ (Commercial Mexicana), Organizacion Soriana SA de CV⁷ (Soriana), Grupo Gigante SAB de CV⁸ (Gigante), etc. Wal-Mart's success in Mexico forced these local retailers to improve their operational efficiency. They started focusing on their database management, supply chain, store interiors, product pricing, and customer care in order to compete with Walmex (Refer to Exhibit I for a note on the retail market of Mexico)...