4.0 Walmart’s External Market Environment 4.1 4.2 4.3 4.4 Economic Environment Technological Environment Political and Legal Environment Cultural and Social Environment 4.1 Economic Environment Macro-economic environment includes national income, economic growth and inflation. Walmart operates both in the United States and internationally in 28 countries. Affected by economic market and business conditions around the world which Walmart operates. 4.1 Economic Environment Factors Economic Factors that can affect Walmart’s financial performance include: Inflation or deflation conditions within a country Consumer wages Unemployment levels Transportation, energy and utility costs Currency exchange rate fluctuations Consumer confidence and spending levels 4.2 Technological Environment Walmart has integrated online e-commerce business to grow their business beyond the physicial stores. Broad assortment of merchandise including items not offered in stores Merchandise can be shipped or picked up at a local Walmart store Walmart Pickup is for grocery items where pick-up time is selected and the groceries are delivered to the customer’s vehicle. 4.3 Political and Legal Environment Political factors affect the economic environment of a region. Example: Trade rules and regulations impact how international trade is conducted. World Trade Organization – global international organization that deals with rules of trade between nations North American Free Trade Agreement – created to eliminate trade barriers between United States, Canada and Mexico. 4.3 Political and Legal Environment Walmart has hired lobbyists to influence government legislation which in general can include lobbying on trade policy, taxes, and labor and workplace laws. Figure shows the amount of money Walmart has spent between 1998-2018 on lobbying. Taken from: OpenSecrets.org 4.3 Political and Legal Environment Legal Environment: Walmart operates in a complex regulated legal environment both in the United States and in the other countries it is located. Laws pertain to: Consumer protection laws Product safety laws Employment Regulations Workplace laws Taxes 4.3 Political and Legal Environment Legal Environment: Example: Walmart’s pharmacies must comply with the laws and regulations of the Drug Enforcement Administration (DEA). The DEA regulates the distribution and dispensing of pharmaceutical and controlled substances. Walmart is required to hold valid DEA and state-level licenses and comply with various federal and state controlled substance acts. 4.4 Cultural and Social Environment Affects customer buying behavior by taking into account how and why people live and behave as they do. Success of incorporating the cultural and social environment is shown by Walmart’s ability to adapt its stores to reflect the communities in which they operate. Walmart has been criticized in the past that the building of Walmart stores causes some small business own to go out of business because they cannot compete against Walmart. Walmart participates in social activites to develop a better relationship within the communities they are operating in. 4.4 Cultural and Social Environment Walmart publishes a Global Responsibility Report which shows examples of Walmart’s participation in local communities. Examples in 2018 Report include: Providing $44 million in funding to support disaster relief including funding for the hurricanes that hit the United States and Puerto Rico in 2017. Donated 2.5 billion pounds of food to relieve hunger since 2015. Hired more than 194,000 U. S. Veterans Section 4.0 Works Cited Walmart 2017 Global Responsibility Report, https://corporate.walmart.com/globalresponsibility/global-responsibility-report Walmart 2018 Annual Report, http://stock.walmart.com/investors/financialinformation/annual-reports-and-proxies/default.aspx Walmart Highlights Economic, Societal and Environmental Progress in 2018 Global Responsibility Report Summary, https://3blmedia.com/News/Walmart-HighlightsEconomic-Societal-and-Environmental-Progress-2018-Global-Responsibility OpenSecrets.org – Center for Responsive Politics: Walmart, https://www.opensecrets.org/lobby/clientsum.php?id=d000000367 Perreault, William D. Jr, Cannon, Joseph P., McCarthy, E. Jerome. Basic Marketing: A marketing Strategy Planning Approach (19th edition). McGaw-Hill Irwin. 2014. pp. 66-77. Panmore Institute. Walmart PESTLE Analysis & Recommendations. January 13, 2017. http://panmore.com/walmart-pestel-analysis-recommendations-case-study