Looking at the given data for Walmart’s operations, it is clear that the operating margins for each country can be looked as the independent variable while the dependent variables are the adjoining columns number of stores, net square footage, number of employees, etc. Upon performing analysis for the given data regarding Walmart’s operations in different countries across the world, it was observed that the two factors that most affect Walmart’s operating margins are the proximity of the respective country to the headquarters in Bentonville and the % of Walmart sales in supercenters. This can be confirmed by the fact that these are the only two variables that have a reasonably high r square, and a p value below 0.05. It is safe to assume that there is a strong correlation between these two variables and operating margins of Walmart across the world. Observing the data it is noticed that countries that are further away from the United States tend to have a negative operating margin than those that are closer. The reasons for that could be identified in the case study. A lot has been explained about Germany for example, and how the cultural fabric of Germany was compromised by the German Walmart’s tactic of adopting the American way of greeters and company cheerleaders, resulting in unhappy customers or how employees went on strike across 46 German Walmart stores. The case also explains other reasons for Germany’s poor performance: late deliveries and high stock outs, and retaliatory tactics employed by local markets against Walmart International’s Everyday Low Prices strategy. The case also mentions how Korea’s negative margins may have resulted as a consequence of Korea controlling the warehousing space, distribution and leasing selling space, causing lower return on investments. Another reason for the low operating margins in Korea are the possible existence of gray markets, markets that evade VAT. The fact that only 2% of Korean Retail stores have point of sales systems might explain Korea’s struggle. Mexico perhaps has flourished as a result of an early American Joint Venture in 1991 and also the close proximity to the United States. (only 1200 odd miles). Additionally as Mexico was growing economically rapidly at the time of the joint venture, Walmart’s operations have flourished successfully over there.
