Examining the entry of Walmart into South Africa : a stakeholder management perspective

Abstract

The recent entry of the US multinational Walmart into South Africa has proved to be a source of controversy. Key stakeholders in South Africa objected to the merger and attempted to block it unless certain conditions were met. The aim of this study was to examine the controversy and the conditions surrounding the merger. The research employed a qualitative archival analysis to examine publicly available sources of information with regard to the merger. The findings revealed key stakeholders’ concerns that Walmart’s entry would lead to an increase in imports which would displace local producers, increase unemployment, marginalise trade unions and lower labour standards unless certain conditions were met. The results also revealed problems relating to the firm’s primary focus on “business” while neglecting “public interest” issues, naively relying on their “local retailer” to manage key stakeholders, and assuming that their perceived controversial reputation regarding treatment of trade unions and their views about unemployment as well as the controversies surrounding their history of entry into other global markets would not have the major negative impact it did on stakeholders in South Africa.