Retailing is rapidly becoming a global industry and many retailers are expanding to foreign markets. However, some retailers successful in their home countries have failed in emerging markets such as Chile. A case study of the failed operation of Home Depot in the Chilean market helps in understanding why retailers do not succeed in all international markets. This case study is based on expert and consumer interviews, and analysis of secondary sources such as the local press and company reports. The main objective is to assess the role of the foreign environment on the performance of international retailers, and the main mistakes made by internationalizing firms.