Topic > The Home Depot Failure in Chile - 1372

Each country has its own culture, with subcultures within the dominant culture (Schaefer, 2009, p.69). “Culture is the totality of habits, knowledge, material objects and behaviors learned and transmitted socially” (Schaefer, 2009, p.57). Values, artefacts and ideas are also part of culture (p57). With globalization comes the integration of these cultural aspects, as well as language, social movements, and ideas around the world (Schaefer, 2009, p.20). Internationalization helps in this integration. Internationalization is the process of planning and implementing products and services so that they can be easily adapted to specific local languages ​​and cultures (Linfo, 2006). Numerous American retail companies have expanded into other countries. Many have been quite successful due to their internationalization. However, failing to study the culture, retail practices and consumer market of the country they plan to expand into can be quite costly. Although Home Depot is one of the largest home improvement stores in the world, its expansion into Chile cost them huge financial losses, resulting in their divestment (Bianchi & Ostale, 2006, section 1, paragraph 3). This article will examine the success of the international expansion of Home Depot stores, analyze the mistakes made in Chile, and make suggestions about what could have been done differently. Home Depot reached first place in home improvement centers worldwide in 2001 (Bianchi, 2006, section 1, paragraph 1). In 2002 their net sales reached $58.2 billion (Bianchi, 2006, section 2, para1). At the end of 2003 there were more than 1500 Home Depot stores in the United States, Canada and Mexico. In 1994, Canada became the first foreign country Home Depot expanded into… middle of paper… .executive picks and gaining relationships with local suppliers, the company has a good chance of achieving success in its expansion abroad. Works Cited Bianchi, C. (2006). Home Depot in Chile: case study. Retrieved January 10, 2011, from http://www.carlospitta.com/Courses/Gestion%20Financiera%20Internacional/Cases/Home%20Depot%20Case.pdfBianchi, C. & Ostale, E. (2006). Lessons learned from failed internationalization attempts: Examples of multinational retailers in Chile. Retrieved January 11, 2011, from http://www.carlospitta.com/Courses/Gestion%20Financiera%20Internacional/Cases/Failed%20retail%20attempts%20in% 20Chile.pdfLinfo (2006). Internationalization: a brief introduction. Retrieved January 11, 2011, from http://www.linfo.org/internationalization.htmlSchaefer, R. (2009). Sociology: a brief introduction. New York: McGraw-Hill