Reckless Expansion And Lack Of Brand Positioning Doomed Wal-Mart's Brazil Business, Analysts Say

Wal-Mart’s failure in Brazil is caused by the retailer’s over expansion and a lack of brand positioning. After entering the local market in 1995, Wal-Mart adopted a measured approach to expanding its operations in the country. When Brazil’s economy began growing fast in the early 2000’s, Wal-Mart began its rapid expansion, including the acquisition of local supermarket chains. Relying on an over-optimistic sales forecast, Wal-Mart executives pushed for opening of an increasing number of stores, reaching a total of 544 stores, 200 pharmacies, 50 restaurants, and 10 gas stations in 18 states and the country’s capital.