Tuesday, May 23, 2006

Walmart's Korean Retreat Tactical or Strategic

Walmart (NYSE:WMT)retreats from Korea because they cannot achieve the scale they feel they need. Little information provided as to why they cannot bite off a piece of the market to their liking. Most military planners accept occasional retreat as sound. Cut your losses and fight another day. Why did the Walmart model not work in Korea? Should Walmart draw strategic conclusions about the experience? The sale price was announced (US$882 million) I assume all cash as nothing else was said. Are there any other impacts to earnings and or balance sheet? Sometimes defeats teach more than a long string of victories.