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Wal-Mart's competitive strategies
Recommendations for strategy of walmart
Walmart success and failures
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Wal-Mart Stores, Inc.: On Becoming the World’s Largest Company (2002)
Executive Summary:
Objective:
This case’s objective is to be able to find out how Wal-Mart Stores positively responded to the time when they encountered a lot of problems and still end up to be the world’s largest company.
Problem:
Wal-Mart had experienced a very disappointing year. It was when sluggish consumer spending, rising unemployment, the energy crisis, and the terrorist events of September 11, 2001 all have unite to make the year a very difficult time in retailing. How did Wal-Mart prevail over this challenging time in history?
Alternative Courses of Action:
• Be consistent in executing their goals in the company.
• Be persistent in treating their customers with a clean, pleasant, and friendly shopping experiences that will definitely satisfy their wants and needs.
• Before deciding to expand stores in other countries, have a marketing research team to study the cultures and buying preference of the target markets.
Methods of Analysis:
1. SWOT Analysis. It is a tool for strategic planning that will help evaluate the company’s Strengths, Weaknesses, Opportunities, and Threats. This tool helps us see why the company is doing better in some areas. This tool identifies the external and internal factors of the company.
2. Value Chain. It is an analytical tool that describes all allowances that make up the economic performance and capabilities of the firm. It is also used to analyze and examine activities that create value for a given firm.
Recommendation:
I recommend alternative number two that Wal-Mart should still be persistent in treating their customers with a clean, pleasant, and friendly shopping experiences that will definitely satisfy their wants and needs. I chose this alternative because as Wal-Mart continues to please customers, they will gain loyalty. With these loyalists they will not run out of customers because a lot of these customers are satisfied and happy with the products and service Wal-Mart offers.
Conclusion:
In conclusion, Wal-Mart has overcome all the difficult time in retailing for the reason that they were so good in treating their customers with satisfying strategies.
Analysis:
SWOT Analysis
Strengths
• Well trained employees.
• Aggressive Marketing Strategies.
• They have number of stores and outlets.
• Consistently updating their technologies.
Weaknesses
• Employees leave the company because of other lawsuits.
Opportunities
• Find new areas to grow sales and profits.
• Expansion of stores to other countries.
• They have been given titles (“Retailer of the Century”, “100 Best Places to Work”, “America’s Most Admired Companies”, and Global Most Admired Companies”) that can increase awareness to customers and people who are unemployed.
• They have variety of products that are sold.
Wal-Mart has had a significant economic impact on the US, as well as the economies of countries that have relations with the US. Wal-Mart is the world’s biggest company of any kind, with 80 percent of the households in America purchasing something from the superstore; it is the nation’s largest retailer. Wal-Mart’s continuing price reduction has given Americans the advantage of being able to afford 15 to 20 percent more than they previously could. (Hansen) In a world governed by globalization and greed, competition has become rigid; as a result firms like Wal-Mart have utilized advanced marketing strategies to insure that they are on the ‘neck’ of competition, and are the core deciders of the market. (Ortega) However, Wal-Mart made decisions that were of a disadvantage to aspects of the economy, including the depletion on a small scale of Small Town USA.
The success of Wal-Mart has yielded admiration and sometimes condemnation from numerous stakeholders. While some people applaud the retail giant for improving the living standards of citizens, creation of jobs, and improving the welfare of its employees, others argue that the retail giant has disrupted communities, brought down small retailers and compromised the living standards of
Within an excerpt from, “The United States of Wal-Mart,” John Dicker explains that Wal-Mart is a troubling corporation. Dicker begins his article by discussing why the store is so popular within the news in an age of global terrorism, coming to the conclusion that Wal-Mart has a huge scope in the United States and that it has more scandals, lawsuits, and stories than any other supercenter. Continually, he goes on to explain that Wal-Mart outsources jobs and their companies demands makes it hard for employees to have livable wages and good working conditions. Furthermore, Dicker addresses the claim that Wal-Mart provides good jobs, by destroying this perception with statistics showing how employees live in poverty and that their union scene
However, it has made lot of success and its working culture and style of working is also different from other departmental stores.
Wal-Mart is one of the world's greatest assets to most people. It provides consumer's a place they can go to virtually get anything they need from, car repairs, to groceries, prescription's, even the latest toys and electronics. With all that said, this paper relates to the different forces in business that affects business: competitive, economic, political + legal + regulatory, technological, cultural + social, demographic, and natural forces. Although there are technically seven we are going to focus on competitive, political, technological, and natural forces.
In general merchandise retailing, Wal-Mart’s primary competitors are Target and Kmart. Retail superstores such as Circuit City and Bed, Bath, and Beyond, also provide retail competition. A survey found that the majority of respondents favored Wal-Mart over stores like Target and Kmart. Respondents claimed Wal-Mart offered lower prices, better variety and selection, and good quality. The needs of consumers is an important economic feature in all competitive environments. What attributes (price, variety, quality, etc.) prompt buyers to choose one retailer over another is very important in the competitive landscape.
Many large retailers such as Target and Nordstrom did not do well during the recessionary economy. Many of those large retailers had to shut some of their stores down due to low sales during the recessionary economy. During a slow economy the Wal-Mart Incorporation did great. Wal-Mart Inc. did great during the recessionary economy was due to Wal-Mart’s everyday low cost marketing strategy (Ferrell, Hirt, & Ferrell, 2009). The working class consumers are Wal-Mart Inc.’s primary target market clientele. As a result of the recessionary economy, Wal-Mart gained the competitive edge over its competitors and caused their upper class consumers to begin shopping at Wal-Mart Inc. (Collins, 2011).
Wal-Mart Stores Inc. is in the discount, variety stores industry. It was founded in 1945, Bentonville in Arkansas which is also the headquarters of Wal-Mart. Wal-Mart operates locally as well as worldwide. It operated 1209 discount stores, 1980 super centers, and 567 Sam’s Club by January 31, 2006. It has also extended its operations to many international countries. It runs its retail stores in two forms: Sam’s Club and Wal-Mart Stores. The Sam’s Club sells assorted product lines such as hardwares, electronics, jewelry, and to mention a few. The Wal-Mart stores also offer similar products in addition to the following: health and beauty products, apparel for women, men and children, household appliances etc (www.yahoo.finance.com). The Vision Statement, Mission Statement, Values and Code of Conduct, Corporate Governance: Directors, Executive Management, Committees and Stakeholder will be the key elements that will discussed in this report as it relates to Wal-Mart. In addition to that, the major trends in the general/macro environment and industry will be analyzed.
Wal-Mart as we know it today evolved from Sam Walton’s goals for great value and great customer service. Mr. Walton’s competitors thought his idea that a successful business could be built around offering lower prices and great service would never work. Mr. Walton also credited the rapid growth of Wal-Mart not just to the low costs that attracted his customers, but also to his associates. He relied on them to give customers the great shopping experience that would keep them coming back. Sam shared his vision for the company with associates in a way that was nearly unheard of in the industry. He made them partners in the success of the company, and firmly believed that this partnership was what made Walmart great.
With the ability to control its stock and see at a glance how any store is performing, Wal-Mart is able to keep its finger on the pulse of its business and make critical adjustments as necessary. The low transportation costs it achieves with its own transportation system makes it possible to deliver goods to different stores within or under 48 hours, and transportation costs are only 3% of the total costs, as compared with 5% for their competitors ("Wal-Mart 's Supply Chain Management Practices: The Benefits Reaped"). Its advanced methods of transport, This combination of technology and down-home attention to customers as people makes Wal-Mart hard to beat on any soil, and it uses the winning formula to maximum advantage.
The most significant component of Wal-Mart’s success was the way it treated its employees or as they are known as in Wal-Mart “associates”, the beliefs or rules of the Wal-Mart culture makes associates want to provide excellent service to its customers. During visits Walton encouraged associates to pledge to greet customers and ask if they assist them or walking into a Wal-Mart store customers are met by a greeter, an associate who welcomed them and handed out shopping carts (Farhoomand, 2006).
Wal-mart has been able to achieve respectable leadership in the retail industry because of its focus on supply chain management. Discuss in detail the distribution and logistics system adopted by Wal-Mart.
Wal-mart has a reputation for caring for its customers, of course their employees, and for the prospective public. So Wal-Mart can be an industrial leader for the world of shoppers with an eye for lower affordable prices, company decision makers would continue it's systematic strategies that it's founder and president established years ago. Sam Walton believed in three guiding principles in his strategy planning they were to provide the customer with good value and service, to have a good relationship with its associates, and to be involved with the community.
Wal-Mart Stores, Inc. is a renowned retail goods superstore that sits atop the Fortune list at number one. It would be very difficult to find an individual who is unaware of Walmart’s position as the largest brick-and-mortar retail chain in the world. The company has thrived over the past few years and continues to grow by effectively managing its store operations and distribution strategies. One of the major contributors to the business consistently meeting market expectations is directly attributable to their management approach. Walmart has revolutionized the way retail companies manage their supply chains in more ways than one.
I understand the term customer value to define how customers weigh the benefits of individual purchasing decision against the costs of these products.