International Business Essay Example | Topics and Well Written Essays - 3000 words - 3

International Business - Essay Example (Appelbaum and Lichtenstein, 2006, pp.106-107). These global networks create buyer-driven commodity chains, which play the crucial role in shaping the world’s markets, setting the prices, and decide on the global distribution of labor. Both the UK and the US economies have undergone dramatic changes following the retail revolutions. The US is home to 7 out of 10 largest world retailers, which account for 30.1% of all sales of the 250 retailers(Campling,n.d). The most important US retailer is Wal-Mart, which owns nearly 4200 stores all over the world. In the UK, there are four big retail chains: Tesco, Asda, Safeway and Sainsbury, which possess 65% of the national market share (Burt and Sparks, 2003, p.239). Such market concentration, in the US case on international scale, has never taken place before. Thus, rapid rise of retail chains has benefited their shareholders and managers with enormous profits; Sam Walton, the founder of Wal-Mart, was ranked as the richest man in the U nited States from 1982 to 1988. Wal-Mart also created workplaces for 1.35 million associates all over the world. Thus, shareholders, managers and employees of large retail chains are definite winners of retail revolutions. However, there have been also waves of criticism regarding negative impact of retail concentration on suppliers, suppliers, and society in general (Seth and Randall, 2001, pp.256-257). Both the UK and the US economies have undergone dramatic changes following the retail revolutions. This paper focuses on the cases of Wal-Mart and the four leading UK retail leaders to contrast and compare the retail revolutions in both countries, their key factors, characteristics, and the winners and the losers of retail revolutions in the UK and US. To start with, while the changing structure of British retailing has affected the markets only on a national and local scale, the rise of large US retailers has had an enormous impact on the global economy (Burt and Sparks, 2001). In 2001, the world’s thirty largest retailers, most of them based in the USA or the European Union countries, reached the annual revenues of nearly 1.3 trillion dollars. The report by an international consulting group Deloitte from 2008 reveals that the economic concentration of the largest world retailers is growing continuously; in 2005 alone the market share of 10 largest retail companies increased 10 %, accounting for the 30.1% of all sales of the 250 top retailers (Campling, n.d). While 7 out of 10 the largest retailers are US-based companies, such as the world leader Wal-Mart or Home Depot, there is only one UK company, a grocery and general merchandising retailer, Tesco, in this ranking. Thus, the influence of the US leading retailers on the global economy is greater than of any other country; Wal-Mart alone operates nearly 4200 stores and employs nearly 1.35 million associates all over the world (Burt and Sparks, 2001). It owns over 386 million ft 2 of floor space in the US and 80 million ft2 abroad, with approximately 94 000 ft2 of sale space in each discount store and 182 000 ft2 per supercenter. In fiscal year 2000 Wal-Mart added 30 million ft2 to its floor space, planning to add further 40 million ft2 of space in 2001. In comparison, the British leading supermarket chain ASDA owns a total of only 18.8 million ft2, out of which 52% is sale space. That great difference in the scales of the UK and the US retail activities is also reflected through the overall share of world trade of these