Walmart: A SWOT Analysis Of Walmart

The first Walmart was located in Rogers, Arkansas, it was founded in 1962, by Sam Walton, he called it simply “Walton’s”. At first it started as a small town mom & pop store, and then it grew, the original store is actually now the location for The Walmart Museum.

Strengths

Walmart is a global retail store, since March 2016 there have been a reported 11,539 Walmart stores, this number does include the 654 Sam’s Club stores. Sam’s Club is owned by Wal-Mart Stores, Inc, which is the retail corporation that does business as Walmart. Walmart is one of the strongest brands in the world. It is the world’s largest company by revenue. Walmart is one of the strongest brand names in the United States, there aren’t many people who don’t know

In just 2016 alone, there was hundreds of thousands of petty crimes. Additionally, that same year, there were 200 violent crimes including, attempted kidnappings, stabbings, shootings, and murders. Walmart’s cost cutting measures have resorted in not enough security personnel, out of date video cameras, or just lack of video cameras in general. These cost cutting measures are directly related to their low profit margins.

Walmart has thin profit margins, which leads them to cut costs, as much as possible. Thin margins are an effect that is caused by using the cost leadership strategy. Since Walmart prices are so low, they must reduce their operating costs. They can do this by lowering their workers hours, developing new technology to speed up efficiency in stores, and by lowering worker accidents and liabilities. In turn, however, this may also cause more employee and customer accidents because, with cutting costs, comes more risk. While stores are trying to cut costs, the inventory side of the business can be problematic.

Walmart stores have very high inventory levels. They are inventory rich so they have to have huge storage rooms with additional staff to maintain the rooms and the efficiency. This can become a very expensive operation because of employee wages. They also must have their employees unload their freight trucks, which is another big cost.