Read the case study Wal-Mart Goes South at the end of Chapter 8 in your course textbook, and respond

to the follo in! "uestions# $o %uch of Wal-Mart&s success is due to '()*(, and ho %uch is due to Wal-Mart&s inherent co%petiti+e strate!y, $o has the i%ple%entation of '(*)( affected Wal-Mart-s success in Mexico, )aced ith !oin! out of business, hat steps did Co%erci take to re%ain co%petiti+e, What other steps do you think Co%erci should take to secure its future and further co%pete ith Wal-Mart&s operations in Mexico,
Wal-Mart was very successful in its business due to NAFTA because of the policies of NAFTA helped Wal-Mart a lot in expanding its business. Wal-Mart appeared as a strong retail chain, which sell every product with lower prices rather than other co petitors. !t was due to the NAFTA"s lifting of tariffs. Therefore, it helped Wal-Mart to have a strong co petitive advantage in the new ar#et and being beco e a largest retailer in Mexico. $%very &ay 'ow (rice) and $%very &ay 'ow *osts) is #nown as slogans of Wal-Mart. The slogan $%very &ay 'ow (rice) is used to attract ore custo ers while the slogan $%very &ay 'ow *ost) is for the internal usage, which eans Wal-Mart has been using it to inspire its e ployees to wor# efficiency and wor# hard to the lower cost. Moreover, Wal-Mart has a very big si+e and volu e of purchase so it is easy for Wart-Mart to negotiate with the suppliers to cut down the prices of products. Additionally, to reduce the production costs, which could be passed on Wal-Mart and also its custo ers fro the suppliers, Wal-Mart had used an advanced infor ation syste to wor# closely with the suppliers on inventory level. Thus, the suppliers could #eep the inventory on the right trac#, they could #now when purchases have been ade fro Wal-Mart and when were the next orders of Wal-Mart, which would help the to plan the production running ore accurately and effectively. Additionally, Wal-Mart has a uni-ue distribution syste that can help Wal-Mart to reduce the expenses in transportation. All these above co petitive strategies have helped Wal-Mart a lot in developing and are resulted in great successful for Wal-Mart. Wal-Mart"s success in Mexico has been surely affected by the i ple entation of NAFTA. !t has brought any benefits to Wal-Mart"s business in Mexico. First of all, NAFTA reduced tariffs on A erican goods which were sold in Mexico ar#et fro . to /0 percent. This would bring a big advantage for Wal-Mart to co pete with other co petitors in Mexico. 1econdly, the logistic proble of Wal-Mart was solved because NAFTA has encouraged Mexico to i prove the transportation infrastructure. Therefore, Wal-Mart could reduce the lead-ti e in logistic because of better transportation infrastructure. Further ore, NAFTA has also opened its gate to attract ore foreign invest ents into the Mexico ar#et. For Wal-Mart, it could spend a lot of oney if it wanted to i port foreign goods fro other regions such as %urope and Asia because of high i port fees and transportation cost. 2owever, since NAFTA encouraged foreign co panies investing and building anufacturing plants in Mexico, it could help Wal-Mart to cut the logistic cost down. *onse-uently, Wal-Mart could save a lot of oney and be ore successful in Mexico because of receiving strong supports fro NAFTA. 1ince Wal-Mart entered into Mexico ar#et, it was difficult to *o erci to co pete with Wal-Mart because of great expand of Wal-Mart in Mexico. %ven, not only Wal-Mart can receive benefits fro NAFTA, other retail chains such *o erci also ta#es advantages fro Wal-Mart. 2owever, *o erci and other co petitors of Wal-Mart have not used NAFTA"s benefits as good as WalMart. To re ain the co petitive in the ar#et, *o erci has collaborated with two other struggling ho egrown super ar#et chains, which are 1oriana and 3igante. This collaboration is #nown as 1inergia, it was established to allow the 4*o erci, 1oriana and 3igante5 to

negotiate better bul# prices fro their suppliers. Fro that, they can save ore oney and then reduce the prices of their products to co pete with Wal-Mart. Further ore, *o erci has 6 strategies that it can use for the future and further co pete with the Wal-Mart. The first strategy is that *o erci still re ains independent business as before but it should create a uni-ue and differentiated i age for its own business to co pete with Wal-Mart. 7therwise, erging with local retailers 4li#e 1inergia5 is the second strategy that *o erci can apply to aintain the co petitive with Wal-Mart in Mexico ar#et. References: &aniels, 8., 9adebaugh, '., : 1ullivan, &. 4600;5. International business, environment & operations 4/6th ed. !nternational %dition5. <pper 1addle 9iver, N8= (earson (rentice 2all. 'uhnow, &. 4600/5. Lower Tariffs, Retail Muscle Translate Into Big Sales for Wal-Mart in Me ico!, Wall 1treet 8ournal. 9etrieved fro http=>>www.wright.edu>?tdung>Wal art@in@ exico.ht l

What are the principal re!ulations or practices of nontariff "uantity controls instituted by !o+ern%ents that affect i%ports and exports, Why are these practices or re!ulations i%ple%ented, .o you feel re!ulations and controls should be increased/decreased, Support your perspecti+e ith rationale, e+idence, and/or exa%ples0 Re%e%ber to cite any sources used, includin! the textbook 1(2( for%at is re"uired30
Quota= the govern ents set the li itation of -uantity products that can be i ported or exported in particular period. !n general, -uota generates the revenue for the co panies that can obtain a portion of li ited supply of product which will be sold to local custo ers. Buy Local Legislation= is another for of -uantitative trade-control. Through this legislation, the large part of total countries" expenditures is govern ent purchases. These countries always refer to buy goods fro do estic producers. 2owever, so eti e the govern ents of these countries will restrict the percentage of do estic content, which eans that the govern ent will set a certain percentage of the product, ust be produced do estically. Standards and labels: the purpose of this barrier is protecting co unity health and safety but so eti es, countries have re-uire ents of labels, standards that a#e the sale of do estic products easier and li it the sale of foreign products. Specific permission requirements: with this barrier, the i porters>exporters are re-uired to sub it sa ples of products to govern ents in order to get i port>export license. This barrier has either direct or indirect i pacts on i ports>exports activities because the govern ent ay deny the re-uest and the process would ta#e a lot of ti e, oney to co plete. Administrative Delays eans that international ad inistrative delays create uncertainty and raise the cost of carrying inventory. 2owever, because of co petitive pressure, the govern ents try to i prove the process of ad inistrative in order to ini i+e the cost of ove ent of goods between countries. Reciprocal Requirements: so eti es, govern ents re-uire foreign suppliers to ta#e products instead of oney. !t also can be understood as a direct exchange between two countries. For exa ple, !ndonesia bought 9ussia Aets but 9ussia too# rubber instead of oney.

Restrictions on services= there are . reasons for restricting trade in service, including= essentiality, standard and i igration. %ssentiality= eans that there are essential services for co unity such as transportation, postal, ban#ing and utilities and these services are not sold for profit. Thus, govern ents set price control to prohibit either local or foreign co panies. 1tandard= the govern ents li it the foreign entry into particular service professions. Thus, the foreign co panies ust hire local professionals or send e ployees studying at the host countries to get local certificates. ! igration= the govern ents want organi+ations which are either local or foreign, hire local -ualified wor#ers first before see#ing for foreign wor#ers.

There are any reasons for the govern ents to i ple ents these regulations. The govern ents favor do estic over foreign suppliers, avoid bad>har ful products to protect co unity health and safety, ensure the goods are enough for local citi+en first before exporting or prevent Bbrain rain". !n y opinion, these regulations and practices should increase to #eep the balance between i port and export. Also these regulations will protect the do estic producers and give the opportunities to co pete with i ported products e-ually. Moreover, there are any regional trading groups and each group has its own non-tariff barriers between nation e bers in order to enhance the econo ic, relationship and so on. Therefore, if those groups are getting larger, the non-tariff regulations>practices ay also increase. References: &aniels, 8., 9adebaugh, '., : 1ullivan, &. 4600;5. International business, environment & operations 4/6th ed. !nternational %dition5. <pper 1addle 9iver, N8= (earson (rentice 2all. Merwe, *. 4600;5. "on-tariff, regulator# barriers on t$e rise as worl% tra%e contracts&. %ngineering News. 9etrieved fro http=>>www.engineeringnews.co.+a>article>non-tariffregulatory-barriers-on-the-rise-as-world-trade-contracts-600;-0C-/;