...Some threats and challenges Wal-Mart faces include increased competition, slow market growth, entry of new competitors, loss of sales to substitutes, growing bargaining power of suppliers, growing bargaining power of customers, adverse demographic changes, restrictive trade policies, and new regulatory requirements. Wal-Mart faces competition from general merchandise retailers, warehouse clubs, and supermarket retailers. They are also facing challenges from the discount retail industry. These challenges are coming from both inside the United States and internationally. The top competitors are Target, Kmart, Circuit City, and Bed Bath and Beyond to name a few. Even Sam’s Club is facing stiff competition from Costco. On the supermarket side of the industry, Wal-Mart is facing competition from Kroger’s, Albertson’s, and Safeway, even though these stores are finding it difficult to compete with Wal-Mart’s low prices. Some of the current challenges Wal-Mart is facing is the ability to expand in areas previously they have not been able to. Currently Wal-Mart really doesn’t have any more room in the United States to grow. Additionally, if they add more stores in the United States they will potentially face an issue with taking sales away from each other. An area in the United States that they could expand into where they have failed in the past is larger cities like New York City. The possible reason behind this is Wal-Marts opposition to unionized labor. Another possible...
Words: 3299 - Pages: 14
...International Business Strategy | Wal-Mart Case Study | | Aneesha Radia | | 09466782 | 1/28/2013 | | Contents 1. How attractive was the discount retailing industry in the USA when Wal-Mart first began operations in the 1950s? 3 THE THREAT OF ENTRY 3 THE DEGREE OF RIVALRY 3 THE THREAT OF SUBSTITUES 3 BARGAINING POWER OF BUYERS 4 SUPPLIER POWER 4 2. With reference to the key components of its Business Model, describe the sources of Wal-Mart’s competitive advantage in the USA 4 FIRM INFASTRUCTURE 4 HUMAN RESOURCES 5 INFORMATION TECHNOLOGY 5 PROCUREMENT 5 INBOUND LOGISTICS 5 OPERATIONS 5 MARKETING AND SALES 6 3. How sustainable is Wal-Mart’s competitive advantage in discount retailing in the USA? 6 IMITATION 6 SUSTITUTION 6 SLACK 7 HOLD-UP 7 4. With reference to Dunning’s Eclectic Paradigm of foreign direct Investment (FDI), compare and contrast Wal-Mart’s entry into the German market in 1997 with it’s subsequent entry into the UK market in 1999. Why was Wal-Mart unsuccessful in Germany, withdrawing in 2006, and relatively successful in the UK? 7 FIRM SPECIFIC ADVANTAGES 7 LOCATION SPECIFIC ADVANTAGES 8 INTERNALIZATION 9 APPENDICIES 10 APPENDIX 1 10 SOURCE: GOOGLE IMAGES 10 APPENDIX 2 10 SOURCE: GOOGLE IMAGES 10 APPENDIX 3 11 SOURCE: GOOGLE IMAGES APPENDIX 4 11 SOURCE: GOOGLE IMAGES 11 REFERENCES 12 1. How attractive was the discount retailing industry in the USA when Wal-Mart first began operations in...
Words: 5008 - Pages: 21
...Wal-Mart Principles of Management Introduction Wal-Mart (Wal-Mart Stores, Inc.) is currently ranked not only as America’s largest, but also as the world’s largest company (Soderquist, 2005). The store’s three business segments, Wal-Mart International, Wal-Mart Stores and Sam’s Club all operate in discount retail industry. Currently Wal-Mart’s leadership is facing challenging issues including an invariable customer base, a declining same store base and a crumbling reputation. However, Wal-Mart’s history is a living example of innovative and successful leadership. The company started with a single store in 1962, in Rogers, Arkansas and it has grown into what is now regarded as the world’s largest retailer. Wal-Mart runs each store with the products stocked in the store, to the front-end equipments, helping to speed up checkouts. Using the same philosophy in all its stores to provide low prices and superior customer service, Wal-Mart can sell at low prices and thus eliminate expenses associated with frequent sales promotions as well as have predictable sales. Wal-Mart has invented its own unique inventory system, the cross-docking system that has enabled the company to achieve economies of scale, thus reducing the cost of sales. In this system, goods are continually delivered to Wal-Mart’s stores within 48 hours and without the store having to inventory them. This allows the stores to replenish their shelves four times faster than...
Words: 3388 - Pages: 14
...Wal-Mart Incorporated Strategic Initiative Paper Angie Minich, Lakisha Matthews, Rose Pabon, and Steven Sheetz FIN370 December 5, 2011 Alex Gialanella Strategic Initiative Paper Learning Team has discussed and referenced the strategic and financial planning of Wal-Mart Inc. Wal-Mart has proven to be very successful through its many years of service. Wal-Mart has continued to increase in sales since the first store was opened in 1962. The reasoning behind Sam Walton’s, founder of Wal-Mart, success has been his strategic and financial planning through the years. According to Wal-Mart’s 2011 Annual Report, the company’s vision is to save their customers money so their customers can live a healthier life, (Wal-Mart, 2011.) This is Wal-Mart’s strategic plan set for their employees to achieve. Extensive research has to be done on an every day basis to discover what products can achieve this strategic plan. Within Wal-Mart’s vision are two set initiatives; low prices and healthier products. One way Wal-Mart can achieve this is their Global Business Processes team. This team handles the implementing and developing efficiencies within the company. Some ways this can be done is by improving work productivity, understanding the consumer’s needs and wants and also finding the best suited individuals for the company. The Global Business Processes team helps streamline the financial costs to benefit the company’s needs and requirements. An example of an...
Words: 1103 - Pages: 5
...Brian Cash Wal-Mart Case Study International Business How has the implementation of NAFTA affected Wal-Mart’s success in Mexico? When NAFTA was implemented in Mexico, it was an almost immediate success for Wal-Mart. This was because they lowered and abolished the tariffs that Wal-Mart was required to pay prior to the implementation of NAFTA. With the lack of tariff fees, all of the Wal-Marts' in Mexico have been able to offer the “Every Day Low Prices” that we Americans are used to. The Mexican population has other retail options, but none offer the variety of products at the prices that Wal-Mart can offer them. Prior to NAFTA, Wal-Mart was having strong levels of success all over Mexico, but was taking a huge hit as it struggled to incorporate the import costs on the products it sold in the stores. In 1994, NAFTA was implemented in Mexico they were able to do a multitude of things. Firstly, they lowered tariffs from 10 to 3 percent on all American goods travelling from the United States into Mexico. (Daniels, Radebaugh, & Sullivan, 2013) At the same time they were also helping the government by encouraging them to improve its infrastructure. The improvements to subpar roads and the various routes delivery trucks utilized helped connect the logistical issues that plagued Wal-Mart and kept them from branching out into further enterprises within Mexico. The strategy worked and allowed Wal-Mart the ability to transport goods directly to the warehouse and...
Words: 1596 - Pages: 7
...better understand the power of Wal-Mart? In preparing your answer you need to consider Wal-Mart’s relationship with its organizational environment. The list of a variety of successful multinational corporations recorded in the pages of history is unending and in part B of this assignment, one of the world’s most successful corporations, Wal-Mart Stores Inc. will take centre-stage in the discussion of a corporation’s relationship with its organizational environment. The chosen perspectives of Modernism and Post-Modernism discussed earlier in part A will be elaborated further, with respect to Wal-Mart. Subsequently, a brief discussion on how Wal-Mart exercises power and authority and experiences resistance and obedience from its employees and partners will be carried out. From since the humble beginnings of a five-and-dime store in 1962 henceforth, Sam Walton’s Wal-Mart has transformed into one of the most successful retailers in the pages of history and in the world today. Wal-Mart is by far the world’s largest corporation today and it is a company that has become a household name that most Americans are familiar with, a company with stores that offer everything a person could need at low or discounted prices. (The global 500 2002; Belsie 2002) The success of Wal-Mart’s can be critically attributed to the corporation’s ambitions and objectives in helping its customers and people to save money, in order to live better. (Wal-Mart Corporate, 2011) Wal-Mart became the biggest retailer...
Words: 1744 - Pages: 7
...Wal-Mart has become the world’s largest company because of visionary leaders and superb management. Technology has also played a big part in Wal-Mart’s success. Although they have lacked in the e-commerce area, their internal information systems has paved the way for minimizing errors. From managing inventory to managing productivity, Wal-Mart has soared to great heights. One of Wal-Mart’s goals is to be merchants first and technologists second. Wal-Mart has been a responsible and ethical company and has very few issues since their inception. Wal-Mart has always been at the forefront in hiring individuals with disabilities and handicaps. They have been an equal opportunity employer since it has been monitored and offer additional insurance to veterans and seniors. Wal-Mart provides intranet technology to all of their employees so they can view hours worked health benefits available, family and friends’ discounts available, and payroll deductions. By offering this, Wal-Mart is able to save money on administration costs. Wal-Mart stores are well known for promoting within the family (Wal-Mart employees). The company uses technology to organize management training programs for interested employees. The employees are able to look at job postings within the organization apply accordingly. Wal-Mart uses the intranet to provide information to the employees of the skills needed. By organizing the workforce as such, Wal-Mart is able to assemble a workforce by allowing the...
Words: 479 - Pages: 2
...Wal-mart 2013 Principles of Management Wal-Mart and Effective Management Karwan S. Othman Wal-Mart, United States Of America Wal-Mart at Its Peak Wal-Mart is the largest retailer worldwide; the reasons may vary from different functional fields of the company. Fifty years ago, the company started the business based on the lowest prices that could be offered to customers. Since then, Wal-Mart is “Everyday low price” pricing strategy to maximize the sales as much as possible. Besides of that, it is using the current technology to keep track on every single sale at each store among all the stores in around forty countries. New financial systems through the new technology being in charge enable the company to manage the financial systems of each single store. Wal-Mart’s mission is to get to zero waste and highest sales among the other retailers. It is been said that Wal-Mart is doing the best of retailing, and it is because of various aspects of the organization although I believe planning, low pricing, using modern information systems and controlling strategies are the most vital characteristics of the organization’s triumph. Wal-Mart is established based on lowest prices possible for customers, and that is one of the most significant factors of the company’s success. Everyday low pricing, EDLP is a strategy that organizations use to offer low prices than common prices of products which would encourage customers to purchase without waiting for sales. According to the...
Words: 1906 - Pages: 8
...Analysis Twila Clayton BUS 475 June 6, 2012 James Sternieri Strategic Plan Part 2: Swot Analysis Internal Analysis Wal-Mart’s culture includes a list of values and beliefs based on their management and employee relations. This culture that’s included are an Open Door Policy where management believes open communication critical to understanding and meeting our associates’ and our customers’ needs. Associates can trust and rely on the open door; it's one of the most important parts of our culture. Sundown Rule is a rule that management attempts to answer request by the close of business. Grass Roots Process is a belief that associates’ ideas, suggestions and concerns matter. The 10-foot Rule is a customer service tactic that greets and engages customers that are within 10 feet distance. Servant Leadership is a policy Wal-Mart uses to listen to their partners and associates in an attempt to create morale and teamwork. Teamwork is a big part of their store culture as Sam Walton believes in the power of teamwork to help grow at the pace of modern life. Wal-Mart Cheer is incorporated by all associates by shouting enthusiastically inside the store to show pride in the company. Lastly, Wal-Mart reads associates’ stories to carry out their beliefs and values as well. Company image Wal-Mart aims to help customers save money to improve their purchasing power to live better. The company’s marketing efforts are to establish awareness that they are the price leaders in their market...
Words: 1497 - Pages: 6
...Case Objective: This case objective is to study Wal-Mart’s history, external environment, internal environment, perform a SWOT analysis, analyze its business strategy, performance measures, and to provide strategic recommendations. Moreover, Wal-Mart’s “glory days are over” and its stock is “dead money”. So, what had worked in the past for Wal-Mart was no longer sustainable in the current competitive environment. The president Lee Scott wondered whether he should somehow adjust Wal-Mart’s course or to change efforts he had started over the past few years would begin to have a positive effect. These statements and facts will be addressed and discussed in the course of the paper and presentation. Wal-Mart's Mission: "To give ordinary folk the chance to buy the same thing as rich people" Wal-Mart's Vision: "To become the world leaders in retailing" (WalMart.com, 2011) Introduction: Wal-Mart Stores, Inc. is an American public corporation that runs a chain of large, discount department stores. It is world’s largest public corporation by revenue and was founded by Sam Walton in 1962. It is the largest private employer in the world and the fourth largest utility or commercial employer. Other key facts about Wal-Mart are that “at the end of fiscal year 2010 Wal-Mart has over 4,300 stores and clubs in the U.S., and more than 8,400 units worldwide.”(Walmart.com, 2011) They employ 1.8 million in over 6,700 stores in 14 countries and on a weekly basis “they serve 200...
Words: 2508 - Pages: 11
... July 5, 2011 Resources and Capabilities of Wal-Mart Wal-Mart had enough financial resources to make capital investments to improve its operations and labor productivity. Most important investments were technological investments such as the UPC (Uniform Product Code) infrastructure, the computerized system within stores and the satellite network that enabled almost real-time communication among the stores, the distribution centers and vendors. These technological resources can also be classified as equipment related resources. As a result of these resources, Wal-Mart had strengthened capabilities in financial management, purchasing, administration, inventory management, labor productivity and store management. The computerized system within the stores enabled Wal-Mart to wire the merchandise requests of the stores directly to the central computer at the related headquarter, which functioned as a distribution center. In case the stock levels were lower than the critical levels, the merchandise could be reordered directly from the related vendors thanks to this computerized system. This system not only enabled to track inventory, sales and accounting functions but also strengthened the bargaining power in purchasing of Wal-Mart. Each vendor could supply no more than 2.8% of total purchase of Wal-Mart. With the $20 million worth of satellite network investment, Wal-Mart could ease the real-time communication among the stores, the distribution...
Words: 1354 - Pages: 6
...Wal-Mart Stores Inc INTBUS202 Assignment- Group 11 2nd February 2012 Prepared By: Kanji, Kalavati (4299847,kkan040) Lai, Xin (1273844, xlai007) Lawrence, Lily Veronica (1655682, llaw039) Lovell, Eryn Isabel (1502870, elov008) McClain, Todd Micheal (1025058, tmcf011) Table of Contents Introduction………………………………………………………………3 Stakeholder Analysis…………………………………………………4 External Analysis………………………………………………………7 Opportunities/ Threats……………………………………………9 Industry Analysis…………………………………………………….10 Value Chain Analysis……………………………………………….13 Core Competencies…………………………………………………16 Recommendations………………………………………………….18 Conclusion……………………………………………………………….21 References………………………………………………………………22 Introduction Wal-Mart Stores, Inc. (Wal-Mart) is currently ranked as, not only America’s largest, but the world’s largest company (DuBois, 2011). Wal-Mart’s three business segments, Wal-Mart Stores, Sam’s Club and Wal-Mart International, all operate in the discount variety retail industry. Currently, Wal-Mart’s strategic leaders face challenging issues including declining same-store sales, an invariable customer base, and a crumbling reputation. In analysing the company’s stakeholders, external and internal environments, its opportunities and threats, and its core competencies and competitive advantage we recommend that Wal-Mart: • Place a greater emphasis on the local communities in which it operates in order to stimulate same-store sales; • Improve their supply chain efficiency...
Words: 3943 - Pages: 16
... Ark., he had a simple but momentous idea. Like any retailer, Walton was always looking for deals from suppliers. Typically, though, a retailer who managed to get a bargain from a wholesaler would leave his store prices unchanged and pocket the extra money. Walton, by contrast, realized he could do better by passing on the savings to his customers and earning his profits through volume. This insight would form a cornerstone of Walton’s business strategy when he launched Wal-Mart in 1962. Walton understood that a major requirement for keeping costs down was controlling the payroll. He said, “Payroll is one of the most important parts of overhead, and overhead is one of the most crucial things you have to fight to maintain your profit margin.” Not only did Walton prefer to hire as few people as possible, but he also feared paying them more than he had to. Unions were particularly feared, and Walton did everything he could to fight them, almost always successfully. The company was incorporated as Wal-Mart Stores, Inc. on October 31, 1969. In 1970, it opened its home office and first distribution center in Bentonville, Arkansas. It had 38 stores operating with 1,500 employees and sales of $44.2 million. It began trading stock as a publicly held company on October 1, 1970, and was soon listed on the New York Stock Exchange. The first stock split occurred in May 1971 at a market price of $47 (equivalent to $274.00 in 2014). By this time, Walmart was operating in five states:...
Words: 1675 - Pages: 7
...Griggs, Alejandro Ortiz, Angela Johnson MGT/330 May 18, 2011 Dr. Alex Karie Control Mehcanisms Wal-Mart is a increasingly large industry functioning to meet the needs of its consumers, employees and producers by using controls; the controls that Wal-mart feel are the most effective at achieving the goals of the company are market control, clan control, manager audits, and performance standards. These controls help make Wal-Mart the growing empire it is today. No business can thrive without some form of control. The way that each form control works effects all of the four functions of management; organizing, leading, controlling and planning. Each control chosen by Wal-Mart was chosen because they are important to thrive in the business world they help increase the confidence of customers, employees and suppliers. All controls involve managers making decisions that are for the betterment of the company. But there are differences between the many control mechanisms that are implemented within Wal-Mart. The following control mechanisms are used at Wal-Mart; market control, clan control, manager audits and performance standards. Market Control is maintained through certain aspects of the market including market share, price, and competition. This form of control is also called decentralized control. Market control is used when there is a reasonable level of competition within the market especially in the service area as well as goods. Managers compare prices and profits to establish...
Words: 1477 - Pages: 6
...implementing innovative business models within his operations and finance departments (complex supply chain management and low profit cost-cutting schemes, respectively). Over the next 65 years, Wal-Mart grew to be the largest corporation in the United States with over 5,000 stores and a staggering 1.2 million employees. In fact, Wal-Mart’s staff accounts for 1% of the United State’s working population (Blodget, 2010). Unfortunately, such an enormous presence, combined with negative reviews, has turned Wal-Mart into the country’s most hated retailer of all time (Picchi, 2015). As such, Wal-Mart is constantly investigated, scrutinized, and sued. The following essay analyzes Wal-Mart’s effect on local communities and the corresponding implications the effects may have. In this essay, a community is defined as the combination of local businesses and people surrounding a Wal-Mart store. The analysis is divided into three Parts. Part 1 analyzes Wal-Mart’s effects on local businesses. Part 2 analyzes Wal-Mart’s effects on local populations. Both Part 1 and Part 2 suggest the potential organizational/ethical implications associated with Wal-Mart’s perceived effect. Lastly, Part 3 outlines potential solutions to Wal-Mart’s problems. Part 1: Effect on Local Businesses Wal-Mart reduces the number of small businesses within a community. According to a Hunter College study, local discount stores’ sales decline an average of 10-40% after a Wal-Mart moves in (De Blasio, 2011). As a result...
Words: 2424 - Pages: 10
