Walmart Case Study

Ch happyer 1& 2 Module 1 Wal-Mart Case Study Shannan Haynes St Gregorys University Give a short account of the history of the participation, and trace the evolution of its strategy. Try to mark off whether the strategies evolution of your company is the product of intended strategies, emergent strategies, or near combination of the two. The Wal-Mart story began in 1962 when Sam Walton receptive the first disregard hive away in Rogers, AR. In 1970 Wal-Mart experienced signifi pott growth and make huge advancements In1970 Wal-Mart opened its first distri besidesion center and the Wal-Mart Home section in Bentonville, AR.By 1970 Wal-Mart employed 1,500 associates and had 38 stores with gross revenue of $44. 2 million. In 1970 Wal-Mart also began selling sh ars over the counter as a publicly-held company. In 1971 Wal-Marts stock had is first 100 percent split. At that succession Wal-Mart had stores operating in five states. By 1975 Wal-Mart employed to a greater extent than 7,500 associates and had cxxv stores. By 1977 Wal-Mart was operating in 10 states and opened Wal-Mart Pharmacy. Their growth continue into 1980, when Wal-Mart stock split 100 percent for the fourth time. That year Wal-Mart opened the largest distri just nowion center in Palestine Texas.In the late 1990s, Wal-Mart became the largest orphic employer in the world. They employed 1,140,000 employees. In 2000 Wal-Mart appointed H. Lee Scott as its chief executive officer. That year Fortune magazine ranked the company fifth in its orbiculate Most Admired All-Stars list and named Wal-Mart the third most admired company in America. Wal-Mart made a commitment to bring environmental sustainability into its p atomic number 18ntage in 2005. They opened a store in McKinney, Texas that saved dexterity and conserved natural resources, and reduced pollution. They were also active in conserving decisive wildlife habitats.By 2005 Wal-Mart employed more than than 1. 6 million employees and had more than 6200 stores. By 2006, the number of employees grew to more than 176 million and 6779 locations. In February 2007 Wal-Mart helped launch Better wellness Care Together, Later that year, Wal-Mart expanded its successful 4 dollar generic program. By 2007 Wal-Mart had save their customers more than $396 million on prescription do drugs embodys. On February 1, 2007, Mike Duke took over as chief executive officer. (Pereira, 2002) Sam Walton built Wal-Mart on Respect for the Individual, Service to the Customer, and he always strived for Excellence.He respected his employees and was move to his customers. With commitment to his customers came low prices. Wal-Mart strategy is an intended strategy. It is clear and direct. It was put into baffle in the 1960s by Sam Walton, and refined over the decades. The company is knightly of its strategy and even incorporates it within its moniker Always Low prices, Always. (Pereira, 2002) delineate the mission and major goals of the company. S aving people money was Sam Waltons goal when he opened his first store 40 age ago. Wal-Mart still has the homogeneous goal today.Wal-Mart has expanded their savings to energy, prescription drugs and has partnered with providers and stakeholders to render a competitive advantage. Wal-Mart mission is to do well as a business but to also do good. (Walmart, 2009) Do a former analysis of the internal strengths and weaknesses of the company and the opportunities and threats that it faces in its environment. On the basis of this analysis, see the strategies that you think the company should pursue. Wal-Mart is the number one seller in the unite States. Wal-Mart has a reputation for low prices, restroom and a large selection of products.Wal-Mart has invested into technology and an inter study logistics system. Wal-Mart is ball-shaped but has a presence in relatively few countries. Wal-Mart has invested in human resources and retention of their staff but still cede extensive trava il relation problems. Wal-Mart has been cited by labor groups for wage issues, shift scheduling, and workplace abuses. Wal-Mart has been accused by community groups of destroying the topical anesthetic retail environment in the downtowns of small towns. (Marketing Teacher , 2000) Wal-Mart still has rough opportunities to merge, or form alliances with other global retailers.Wal-Mart rump do more to call attention to its good deeds to help with their image issues. Wal-Mart can continue to expand its supercenters into large cities. (Avila, 2009) Who is the chief executive officer of the company? Evaluate the CEOs leadership capabilities. On February 1, 2007, Mike Duke took over as CEO of Wal-Mart. On June 5, 2009, Mike Duke announced that Wal-Mart was up 6 percent to $3. 35 per share and that 7. 3 billion dollars were returned to shareholders. He also said that sales surpassed 400 billion for the first time. Wal-Mart has satisfying balance sheets and access to pileus markets.Mik e Duke has enhanced training and development of Wal-Marts global workforce. He has also reiterated Wal-Marts commitment to low prices. Based on gain and the commitments he has outlined, I would say that Mike Duke leadership capabilities as CEO are very promising. (Walmart, 2009)+ Apply the five forces model to the attention in which your company is based. What does this model tell you about the nature of rival in the intentness? Potential Competitors Medium squash Grocers could potentially enter into the retail side.Entry barriers are relatively high, as Wal-Mart has an outstanding distribution systems, locations, set name, and financial capital to fend off competitors. Wal -mart often has an absolute cost advantage over other competitors. Rivalry Among Established Companies Medium constrict Currently, there are three main incumbent companies that exist in the same market as Wal-Mart Sears, K Mart, and Target. Target is the strongest of the three in relation to retail. Target has experienced tremendous growth in their house servant markets and has specify their niche quit effectively.Sears and K-Mart seem to be drifting and surrender not challenged Wal-Mart in sometime. Mature industry life cycle per second. The Bargaining proponent of Buyers Low shoveure The individual buyer has little to no pressure on Wal-Mart. Consumer advocate groups have complained about Wal-Marts pricing techniques. Consumer could memory at a competitor who offers comparable products at comparable prices, but the convenience is lost. Bargaining Power of Suppliers Low to Medium pressure Since Wal-Mart holds so much of the market share, they offer a lot of business to manufacturers and wholesalers. This gives Wal-Mart a lot of ower because by Wal-Mart threatening to switch to a different supplier would create a scare tactic to the suppliers. Wal-Mart could vertically integrate. Wal-Mart does deal with some large suppliers like Proctor & Gamble, Coca-Cola who have more bargaini ng male monarch than small suppliers. Threat of substitutes-Low pressure The market is crowded but Wal-Mart has the terminal costs, prices, profits, and market share Wal-Mart is able to negotiate for pricing. This analysis tells me that Wal-Mart does not have to worry about threat to new entrants because it has the capacity to produce more in order to lower the cost.There are high barriers of accounting entry for companies trying to come into the retail industry because of the resources that Wal-Mart has. Are any changes winning place in the macro environment that might have an conflict, collateral or negative, on the industry in which your company is based? If so, what are these changes, and how might they affect the industry? Wal-Mart has received some bad press in the past and is making great commitments to helping the health and eudaimonia of our nation. In 2005 Wal-Mart made a commitment to become more environmentally friendly. Wall-mart adopted an approach they call Sus tainability 360.This approach looks for ways to reduce their environmental impact. In 2008, they announced a new set of clearly defined environmentally and socially responsible practices into their supply chain, where goods are made in a way that protects our planet. (Walmart, 2009) The economy has affected many companies recently yet Wal-Marts overall sales arent rising dramatically, but they are raising, even as the economy grinds to a halt. (Gross, 2008) I believe Wal-Marts macro enviroment is modify them both positvely and negatively. Identify any strategic groups that might exist in the industry.How does the intensity of arguing differ across these strategic groups? Walmarts immediate competitors are those in its strategic group. Included in this group are Wal-Mart, Kmart, Target, and Fred Meyer. Wal-Mart is looking to grow. Their latest initiative, Project Impact, aims to make stores easier and quicker to navigate, improve customer service, and to move in on competitors ter ritory as much as possible. Project Impact calls for remodeling about 70% of Wal-Marts in the adjoining five years, and improving sales in major competitors fields, such as toys and crafts.Wal-Mart has more staying power and is able to dominate its competitors. Target is Wal-Marts pressure competitor. Target is positioned well and has some staying power but Kmart was forced into bankruptcy. The suggestion of this on Wal-Marts competitors is fully grownger, more pleasant Wal-Marts. (Avila, 2009) How dynamic is the industry in which your company is based? Is there any evidence that innovation is reshaping competition or has done so in the recent past? The retail industry is dynamic with the previous innovation being department stores, ring armour order retailing and chain variety stores. However, shopping has changed.Big-box stores like Wal-Mart was authoritative in the evolution of retail trade, providing among other innovative features a one-stop convenience with low prices that many consumers seem to appreciate. (Emerald, 2006) In what stage of its life cycle is the industry in which your company is based? What are the implications of this for the intensity of competition both now and in the future? The Supercenters and Big lash stores are in their growth lifecycle. Led by Wal-Mart, the industry has displayed exceeding growth over the last 10 to 15 years, mostly at the expense of other retailers.What makes this unique is that the discount department store industry was perceived as being at maturity. There are signs that the industry is approaching saturation level. However, the industry is expected to do well by dint of the recession. (Emerald, 2006) Is your company based in an industry that is becoming more global? If so, what are the implications of this changed for competitive intensity? Yes, the retail industry has become more global. Wal-Marts international operations currently comprise 2,980 stores in 14 countries right(prenominal) the Unite d States.According to Wal-Marts 2006 Annual Report, the International division accounted for about 20. 1% of sales. Wal-Mart has inventory management system that no other company is apt to come even close to competing with. This enables it to vary its inventory from store to store and across cultures Wal-Mart has gone global with its buying strategy, and it now puts Chinese suppliers in competition with suppliers from Mexico, Indonesia, Sri Lanka, as well as the United States. world-wideization has changed everything by making technology and methods of production mobile, and by lowering business coordination costs. The big box discount retailers have changed the nature of global competition. (Palley, 2008) Analyze the impact of national context as it pertains to the industry in which your company is based. Does national context help or hinder your company in achieving a competitive advantage in the global marketplace? Wal-Mart has a strong economic affect in any area of the world. Wal-Mart has built an conglomerate on a low-cost model but at the same time, Wal-Mart has faced condemnation for labor practices and indirect burdens on our social and upbeat programs.Some of the business practices of Wal-Mart like the employees wage-benefits package, and the underemployment of women and minorities are the subject of ongoing tilt at the national level. Wal-Mart continues to work on its image and faces the same criticism globally as they do nationally. The reputation that Wal-Mart has here in the U. S. may hinder international expansion, but will not stop it. (USA Today, 2009) References Avila, J. D. (2009). How Wal-Mart allow for Save Wal-Mart. Retrieved April 15, 2010, from B-Net Today http//www. bnet. com/2403-13241_23-158179. html Emerald. (2006).Retrieved April 17, 2010, from Globalizations winners and losers Lessons http//www. emeraldinsight. com/Insight/viewContentItem. do? contentType=Article&hdAction=lnkhtml&contentId=1563323 Gross, D. ( 2008, Febuar y 26). Slate. Retrieved from The Wal-Mart puzzle http//www. slate. com/id/2185221/ Marketing Teacher . (2000). Retrieved April 15, 2010, from SWOT Analysis Wal-Mart http//marketingteacher. com/SWOT/walmart_swot. htm Palley, T. (2008). Manufacturing meets Wal-Mart The Economics of Global Out-sourcing. Retrieved April 17, 2010, from Economics for Democratic and Open Societies http//www. homaspalley. com/? p=19 Pereira, M. (2002, April ). Mike Pereira pen Works and Opinions . Retrieved April 15, 2010, from A Case Study on Wal-Mart Stores Inc. http//www. mike-pereira. com/subpage/docs/walmartcs. htmii2 USA Today. (2009). Retrieved April 17, 2010, from Wal-mart check out www. usatoday. com/money/ /2003-11-10-walmart_x. htm Walmart. (2009). Retrieved April 15, 15, from Our Mission Saving people money so they can live better. http//walmartstores. com/sites/sustainabilityreport/2009/ec_overview. html