Wal-Mart
At the time that Wal-Mart embarked on a program of international expansion, the United States was undergoing negotiations with Mexico and Canada over the North American Free Trade Agreement or NAFTA and this brought Mexico to the attention of Wal-Mart as a fit global venue (Hill 2002). Although the Mexican economy, at the time, was beset with huge barriers to cross-border trade and investment, substantial state involvement in business activity and high inflation, the government of Carlos Salinas introduced free market reforms that rendered the country's conditions attractive to Wal-Mart. Since Salinas assumed office in 1988, Mexico's economy was growing at 4-5% yearly and with an increase in disposable income at 70%. Although it was considered a very poor country by American standards, 30 of its 80 million people could be classified as middle class, the affluent segment concentrating in Mexico City and two others. Wal-Mart's Sam Walton and a founder of Cifra in Mexico believed that the NAFTA agreement and conditions augured well. A decade earlier, Mexicans cried out against colonial and economic imperialism. But that cry died out later.
2) Wal-Mart's competitive advantage consisted...
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