The FIFA World Cup is going on in the USA (along with Canada and Mexico), and as many as 48 nations are participating in it for the first time. More countries from South America, Europe, Asia, Africa, and Oceania have gathered in the United States to cheer on their teams, show their support, and enjoy the FIFA World Cup.
However, as they are doing that, they are also living in the USA for a considerable period of time, a week or two weeks for some people. During that time, numerous people from Europe, Africa, and Asia were taking to social media platforms like Instagram and TikTok to share their experiences of culture shock.
So many non-Americans have never seen huge vehicles or large portions of food items in their countries, and therefore, their shocking reaction was genuine.
But the one common shocking reaction that most Europeans had after visiting the USA was seeing a ‘Walmart.’ Founded in 1962 by Sam Walton, Walmart is an American Multinational Retail Corporation that operates a chain of hypermarkets. The sheer size of a Walmart store is so enormous that it’s enough to make anybody gasp with wonder.
However, this made me wonder – Why are the Europeans so shocked to see a Walmart? Do they not have Walmart in Europe? Turns out, the answer is “No.” So, let’s find out why there is no Walmart in Europe.
It’s not as if there wasn’t any attempt made to introduce Walmart in Europe. Walmart, just like most other American MNCs, is often looking to expand into other foreign territories. But it failed. The reasons Walmart failed in Europe can be classified into 5 points. They are:
5 Reasons Why Walmart Failed in Europe
- Cultural Clashes – Walmart has a forced American customer service. It encourages practices such as mandatory smiling, loud team-building chants, and packing your shopping bags. Europeans didn’t like that. They rejected it since they found it artificial and forceful.
- Strict Labor Laws – European countries have strong labor unions and strict rules for employee rights. In the case of Germany, once, Walmart struggled to fight local unions and adapt to German workplace environments.
- Tight Competition – Local low-cost stores such as Aldi and Lidl already existed in Europe. They already control the European discount market, and therefore, Walmart could not beat them on pricing.
- Zoning Laws – The importance of local businesses is so important in European towns and cities that even mayors and urban planners aid their protection. European cities are tightly controlled. Mayors and urban planners often put a limitation on the construction of massive, car-dependent superstores for that reason.
- Shopping Habits – Lastly comes the shopping habits of Europeans, which vary vastly from those of Americans. Americans drive to a megastore once a week, whereas Europeans don’t do that. They prefer to do smaller, more frequent shopping trips at neighbourhood markets.
Walmart’s entry into the European market was attempted once in Germany. The giant MNC wanted to buy the established chains in Germany, but left after losing billions of dollars by 2006. When they tried to enter the European market via the UK, they owned the Asda supermarket chain. They had owned it for 20 years before selling it.
Walmart has an “Everyday Low Price” and a “Mega Store” model that was simply not accepted in the European culture. Today, whenever Walmart tries to find its footing outside of North America, it does so in emerging markets of Asia and South America. It doesn’t try to compete with Europe anymore.
The American business model is difficult to run elsewhere, and it has been found out multiple times with other multinational brands as well. Take Starbucks, for example, and how it failed in Australia.
