...STRATEGIC MANAGEMENT MGMT E -5000 WALMART CASE ANALYSIS BY Indhu SEPTEMBER 19th, 2012 SWOT Analysis of Wal-Mart: (2008- 2010) EXTERNAL ANALYSIS: Significant findings on the PESTEL analysis were:(Refer Fig 1 ) * Socio Cultural factor: One of the most important concerns among consumers during that period was price. Since its establishment Walton focused on Everyday low prices (EDLP) and always geared towards the low- income groups of the society. This provided Walmart better opportunities and helped them gain a competitive advantage in the industry. * Demographic factor: Another opportunity facing the industry was that Consumers (working Mothers and other American workers) wanted ease of shopping (fast, efficient and one-stop shopping). Walmart provided its customers with what they want in the Walmart supercenters combined with its wholesale unit “Sam’s Club”. * Technological Factor: Heightening of Internet users (70% of the population) and more people were comfortable shopping online. This yielded both favorable (lower over head costs and convenience to the customers with wide choices of items and prices that were appealing) and unfavorable (Walmart has invested heavily on the infrastructure like the EDI links and POS systems) circumstances. * Economic Factor: Domestically the U.S market had a very slow growth. Although the economy was said to be in recession it favored the growth of the organization because it offered consumers commodities at a...
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...Walmart Case Study Beth R. Thornhill Organization The relevance of choosing Walmart lies in their enormous growth and their strategies to be and maintain their competitiveness in the free-market. Some of their strategies were outlined by San Walton, founder of Walmart include: Sam Walton’s strategy of, “If we work together, we’ll lower the cost of living for everyone…we’ll give the world an opportunity to see what it’s like to save and have a better life.” (Walmart.com) Background on Walmart Walmart serves customers and members more than 200 million times per week at more than 10,130 retail units under 69 different banners in 27 countries. With fiscal year 2012 sales of $443 billion, Walmart employs 2.2 million associates worldwide. Walmart was founded in 1962, with the opening of the first Walmart discount store in Rogers, Ark. The company incorporated as Wal-Mart Stores, Inc., on Oct. 31, 1969. The company's shares began trading on OTC markets in 1970 and were listed on the New York Stock Exchange two years later. The company grew to 276 stores in 11 states by the end of the decade. In 1983, the company opened its first Sam’s Club membership warehouse and in 1988 opened the first supercenter -- now the company’s dominant format -- featuring a complete grocery in addition to general merchandise. Walmart became an international company in 1991 when it opened its first Sam's Club near Mexico City. (Walmart.com) Background on Walmart Strategy Traditionally, Walmart...
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...Financial Analysis of Target & Walmart Corporation Columbia College ABSTRACT This paper is a brief background and historical overview as well as financial analysis of Walmart and Target public incorporated companies operating in the retail industry. The financial analysis of both companies using current ratio, net income margin on sales and book value per share reflect relative stable companies with strong balance sheet and low exposure to equity investment risk. Although both companies appear to be fundamentally strong and stable, however, Target seems to be better than Walmart in the context of profitability, liquidity and equity risk exposure as reflected in the calculations. Between 2009 and 2013, Target consistently outperformed Walmart in terms of liquidity position, profitability as well as risk coverage measured by book value per share. INTRODUCTION Walmart is a well-known in the industry when it comes to retail business across the globe. It operates many retail stores in various formats around globally. The company was founded by ”Sam Walton in 1962, incorporated on October 31, 1969, and started trading as public quoted company on the New York Stock Exchange in 1972, and it currently has 30% market share in the America retail industry” (Reuters). It is headquartered in Bentonville, Arkansas. Two of their fundamental operating principles are Everyday Low Cost (EDLC) and Everyday Low Price (EDLP). These two principles allowed the company to build a foundation...
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...primary intent of this paper is to compare the current strategy and operational approaches for two pharmacy retail stores such as Walmart and Walgreens chain stores. A SWOT analysis for both companies is bellow in table. My understanding after the initial study / investigation is that Walgreens has chosen to be conservative with their strategy in increasing their customer reach, market and base by a more organic growth than Walmart which growth approach is to rapidly build small and large supercenters on major neighborhoods in the United States and key cities around the world. The main strategy reporting evidence that reflect these two companies operational growth is mainly reflected in each financial statement that shows profit and loses for each company and their reinvestment percentage into each one. The financial analyses display the result of each company decisions to their market growth approach and impact on investment. Because of their more conservative stand and minimum risk taken by Walgreen’s, their operations model seems more solid and better prepare to accept their rate of growth in contrast to Walmart aggressive scheduled and heavy investment direction. Two different and what appear to be very effective approaches despite their very recent and impressive operations growth for each company. SWOT Analysis Walmart Weakness * Walmart approach to go with large space stores has little penetration in urban stores, plus as it continue to open in larger cities...
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...Industry size Supermarkets & Grocery Stores Market Research Report | NAICS 44511 | Jan 2015 Shopping smart: Increasing premium brand sales and healthy eating trends will spur growth The Supermarkets & Grocery Stores market research report provides key industry analysis and industry statistics, measures market size, analyzes current and future industry trends and shows market share for the industry’s largest companies. IBISWorld publishes the largest collection of industry reports so you can see an industry’s supply chain, economic drivers and key buyers and markets. Market Share of Companies Kroger Publix Super Markets Inc. Safeway Industry Statistics & Market Size Revenue $584bn | Annual Growth 10-15 1.3% | Annual Growth 15-20 | | Profit | Employment 2,489,995 | Businesses 42,036 | Industry Analysis & Industry Trends The Supermarkets and Grocery Stores industry has grown over the past five years, benefiting from a strengthening domestic economy. As per capita disposable income has grown over this period, some consumers traded up to premium, organic and all-natural brands, helping lift industry revenue. Over the next five years, the industry is anticipated to grow as a result of rising discretionary income, albeit at a more conservative rate than in the previous five-year period. As health concerns intensify, more consumers will seek all-natural and organic products, which are priced at a premium... purchase to read more Industry Report...
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...Foreign Markets Executive Summary Walmart has grown into one of the largest retail stores in the world and has proven their operation is successful and effective. However, Walmart is being faced with understanding the symptoms of their domestic problems before being able to compete globally and face additional foreign challenges. This report documents the overview of Walmart and its key strategies. Then, Walmart is analyzed and evaluated. Finally, recommendations regarding Walmart competing in foreign markets is provided. Overview Walmart is the number one retailer in the United States and is at the top of the Fortune 500 listing. Wal-Mart operates in many countries worldwide and is pursuing market share in new countries. As Walmart grows, so do the number of people who have a stake in Walmart. Each year, more claims are made against Walmart by the unions, disgruntled employees and other advocacy groups supporting various interests. Additionally, Walmart is often able to undercut many other local industries forcing more and more local businesses to shut down when Walmart moves into town. As a result of Walmart's ever growing size and dominance, their reputation is becoming more important than before. Also, as Walmart expands into different markets, they will need to be aware of specific country regulations and cultural expectations. These issues need to be addressed by Walmart in order to make it possible for Walmart to build a positive reputation and continue...
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...more specifically how Walmart does business. As many know, Walmart is an American based multinational retail corporation that operates a chain of hypermarkets, grocery stores and discount stores. With over eleven thousand stores and clubs in 27 countries, information technology and data analytics play a major role in Walmart’s survival and helps maintain its competitive advantage. Data Analytics Overview The business intelligence and analytic technologies and applications currently adopted in industry can be considered as BI&A 1.0, where data are mostly structured, collected by companies through various legacy systems, and often stored in commercial relational database management systems (Bottles and Begoli, 2014). The analytical techniques most commonly used in these systems, popularized in the 1990s, are mainly grounded in statistical methods developed in the 1970s and data mining techniques developed in the 1980s (Chiang, 2012). The digitalization of information has created more data and the development of cloud computing, and faster and faster computers has made the increased data more accessible and useful (Bottles and Begoli, 2014). As many may see, business intelligence and the related field of data analytics have become increasingly important in the business communities over the past two decades (Bottles and Begoli, 2014). For example, based on a survey of over 4,000 information technology (IT) professionals from 93 countries and 25 industries, the IBM Tech Trends...
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...Summary Comparing different companies under different rules, or comparing one company in different time period can be complicating and often misleading when differences in accounting methods are not captured. In this essay, I will start the analysis by examining each firm’s change in accounting methods compared to their previous year. Then I will move on to comparing the three companies’ ratios to conduct analysis of each company based on the DuPont Method. In addition, I will also look at how changes in accounting methods affected Seven and I holdings’ results in 2013 when compared to 2012. Finally, I will conclude my analysis on how comparable it was under different accounting methods based on above analysis. _____ Three Companies Chosen for Analysis For this ratio analysis assignment, I chose three companies from the UK, US and Japan: Walmart Country: US Industry: Supermarket Retail Accounting Standard: GAAP TESCO Country: UK Industry: Supermarket Retail Accounting Standard: IFRS Seven and I Holdings Country: Japan Industry: Supermarket Retail Accounting Standard: Japan Standard _____ Change/Amendments in Accounting Methods Walmart Even though there is a mention about recent accounting pronouncements and future adoption of those policies, there is and will be no effect in the firm’s net income, financial position or cash flows. Sainsbury Although there were two amendments effective from this annual reports, the firm has concluded...
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...| Walmart | | | | | Danielle S Holley | 11/28/2011 | | Firms choose from different business-level strategies in order to proposer in today’s markets. One of these being the Cost Leadership Strategy, an integrated set of actions taken to produce goods or services with features that are acceptable to customers at the lowest cost, in comparison to their competitors. Firms that chose to use this strategy must sell standardized goods and services which have to also include competitive levels of differentiation to the market’s regular customers. Cost leaders have to examine all support activities to find extra resources in order to cut production costs allowing them to maintain low costs for their customers. In any industry fixed and variable costs can cause companies to go out of business. Cost Leadership Strategy can put a strain on companies because they have to keep developing new technology that can support low cost goods and services (with differentiation) as well as low production costs to satisfy the needs of customers in the market place. Using this strategy effectively can earn firms above-average returns in spite of rivals in the industry. Having the low-cost position in an industry is valuable way to deal with competitors. The cost leader’s strategic position causes competitors to think twice before they compete on the basics of price and technology against the potential outcomes of such competition (Hitt). Walmart is known for its ability...
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...Global Presence Walmart, which is considered the largest international discount retail chain, was founded by a man named Sam Walton. He first opened a store by the name of “Walton’s 5 & 10” in 1950. When the store became successful he wanted to go bigger which prompted him to open the first Walmart in 1962 in Rogers, Arkansas. Walton wanted to have a store which offered low prices and still quality products. A lot of people doubted him and didn’t think he’d be too successful. They thought his low prices wouldn’t gain him enough profit to stay afloat. By 1967, only 5 years after opening the first Wal-mart, Walton owned 24 stores. The company went public in 1970 and by 1988 it was the most profitable retailer in the US. In March of 1992 Walton was awarded with the Presidential Medal of freedom by President George H. W. Bush. The Presidential Medal of Freedom is the highest civilian award of the United States and it recognizes “exceptional meritorious service.” (infoplease.com) Not even a full month afterwards, Walton passed away on April 5, 1992 of cancer. His oldest son then took over as chairman of the the corporate board of directors. In 2000 Wal-mart.com was founded for US Customers to be able to buy products online. Wal-mart now operates stores in all 50 US States and Puerto Rico. Walmart now has Supercenters, discount stores and neighborhood markets which all vary in size. When finding out so much information about Sam Walton and the history of Walmart I came across some...
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...or service. Step three is explaining the importance of marketing for organizational success. The fourth step analyzes the factors of strengths, weaknesses, opportunities, threats, and trends (SWOTT) of the new product or service. Step five is the marketing research approach for developing the marketing strategy and tactics of the new product or service (Perreault, Cannon, & McCarty, 2011). Organizational Overview Team Charlie chose the Walmart organization for completing this assignment. Walmart is one of the best known organizations in the world that have successful marketing plans and strategies. Sam Walton is the founder of Walmart and opened the first store in Rogers, Arkansas, 50 years ago in 1962 (Walmart, 2012). Currently Walmart operates in more than 10,000 retail stores under 69 diverse banners in 27 different geographic locations across the world. They service customers and members in excess of 200 million times per week with sales of approximately $444 billion continually for the fiscal year 2012 (Walmart, 2012). Sam Walton’s visionary leadership and focus point centered on helping customers and...
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...Walmart is classified as a department store by the Department of Labor, with the Standard Industrial Classification (SIC) code of 5133. The Department of Labor website states, "…these stores must carry men's and women's apparel and either major household appliances or other home furnishings. These and other merchandise lines are normally arranged in separate sections or departments with the accounting on a departmentalized basis” (United States Department of Labor, 2014, para. 1.). The paper will examine Walmart and other industry department stores according to financial reportings, the Dun and Bradstreet Key Business ratios report, and calculations of financial ratios. Team Calculations Solvency Ratio Solvency ratio = (After Tax Net Profit + Depreciation) / Total liabilities 2013 16,999,000+ 8,478,000/ 126,243,000= 25,477,000/ 126,243,000=20% 2012 15,699,000 + 8,106,000/121,687,000 23,805,000/121,687,000=20% Profitability Ratio Return on Sales=Net Income /Net Sales 2013 16,999,000/116,354,000=15% 2012 15,699,000/111,516,000=14% Efficiency Ratio Fixed Asset Turnover Ratio=Net Assets/Net Sales 2013 55,846,000/116,354,000=48% 2012 50,664,000/111,516,000=45% Analysis When comparing the calculated financial ratios for Walmart for 2012 and 2013 to that of the industry averages in solvency, Walmart was steady at 20% in 2012 and 2013 while the median numbers in 2012 and 2013 respectively for the industry were 64.30 and 46.20 (Dun and Bradstreet, 2014, para. 1)...
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...Management & Walmart Outline * This article regarding Strategic Management & Walmart relate to the course content during Week 1 we learned that strategic Management consists of three ongoing processes. 1 Analysis – involves gathering and interpreting data pertaining to the internal and external environment of the organization. 2 Decision Making- leaders must formulate strategies based on the analyses that have been generated –strategic decisions determine what industries the firm competes in and how 3 Implementation – strategic decisions must be implemented effectively – this involves articulating strategies clearly, mobilizing resources, and developing a culture that will facilitate the adoption of the strategy. 1This article has an in depth analysis of Walmart internal and external environment. “Sam Walton's talent for discount retailing not only made Wal-Mart the world's largest retailer, but also the world's number one retailer in sales” 2The industry walmart competes in is discount retailing and the company continues to grow even after the creator and inventor Sam Walton passed away. The leaders of Walmart choose to continue to use the strategies and goals formulated by Mr Walt. “Wal-Mart executives continue to rely on many of the traditional goals and philosophies that Sam's legacy left behind, while simultaneously keeping one step ahead of the ever-changing technology and methods of today's fast-paced business environment” 3 Walmart has good strategy...
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...emergence of the concept suggested to as Green Supply Chain Management (GSCM). This research provided a concise background and challenges of green supply chain through applying qualitative analysis on potential implementation in existing literature. This research was use secondary data to analyze a single case study, which is a case study of Walmart GSCM. Data was collected through a quality source by process of evaluating the information sources. The research analysis have shown seven strategies that used at Walmart: Identifying goals, metrics, and new technologies, Providing network partner assistance to suppliers, Certifying environmentally sustainable products, Incentive for green products, Consolidating direct suppliers, Developing a sustainable standard, and Zero waste. In a conclusion, it was possible to understand that GSCM is one of the emerging approaches for retail industry. This approach had help the company differentiates from its competition and made its supply chain more efficient. This paper was useful in providing suggestions to the retail industry and other industries to either modify the GSCM strategy adopted within organization in order to achieve the required target, or identify the most suitable GSCM strategy to be implemented. Keywords: Supply Chain Management, Retail industry, Green Supply Chain Chapter 1: Introduction The world is warming. The average temperature has risen by...
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...strategic plan and strategy that was followed for the company to be so successful. Walmart which runs as a cost leadership strategy and Home Depot which runs as a service focused strategy are two very good examples of companies that have made it big and are their strategies are easily visible and explained. Walmart seems like an everyday trip to some families around the world because it has become so big that everyone has someone in their family that dreads hearing the famous phrase “We need to go to Walmart today” in their home. Walmart is a cost leadership strategy because they are the lowest cost producer that can sell at or below industry prices and by doing this they gain a bigger market share. This gives Walmart the competitive advantage in many different areas of the market and helps to control pricing.When we look at Walmart’s internal environment we look at their strengths which include the consumer’s knowledge and understanding of low prices, their market clout, their competence in information technology, and their wide range of stores across the world. Customers know that by going to Walmart is going to save them money because of the slogan of Walmart itself: “Save money. Live better”. What actually happens to most people is they go in the store and come out spending much more than they went in expecting to spend because of all the deals that were found while shopping. Walmart has become one the biggest...
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