Introduction• Samuel Moore Walton (March 29,1918-April6,1992)• Founder of Wal-Mart• Declared “richest man in America” in October1985 by Forbes.• Born in 1918 in Kingfisher, Oklahoma during theGreat Depression.
Made in America:Sam Walton 3• Sam always set extremely high personalgoals.• Played football, baseball and basketballand became youngest Eagle Scout in thehistory of Missouri at that time.• Graduated from University of Missouri in1940 with a business degree.• Since high school he paid for all hisexpensesTo Value a Dollar
Made in America:Sam Walton 4First Job• Sam joined JC Penney, a retailingcompany, as a management trainee.• There watching store manager he gotexcited about retailing.• But due to war he had to resign the joband move in 1942.• He married Helen in 1943 while still oncommission.
Made in America:Sam Walton 5Starting on a Dime• Sam learned much about money andfinances from Helen’s father.• He purchased a store in Newport,Arkansas, a Ben Franklin franchise.• He learned a lot from running a store infranchise program.
Made in America:Sam Walton 6Wal-Mart’s philosophy• In his store, he would buy an item for 80cents, priced it to sell at $1.00 and sellthree times more of it than by pricing it at$1.20. The overall profit was muchgreater. By cutting the price, it boostedthe sales to a point where it earned farmore at the cheaper retail price than itwould had by selling the item at the higherprice.
Made in America:Sam Walton 7Bouncing Back• Due to lease contract,he hasto sell his store and move.• It led him to bigger and betterthings• Sam moved with his family toBentonville, Arkansas to openself-service Five & Dime storewhich at that time was a newconcept.
Made in America:Sam Walton 8Bouncing Back• He expanded very rapidly and openedmany variety stores.• But, a new concept of discount store cameinto existence and Sam immediatelysensed that discount idea was the future
Made in America:Sam Walton 9First Wal-Mart• He built a store in Rogers, Arkansas.• Nobody wanted to gamble on it so Samhas to put up 95 percent.• Sam always checked on competition andalways went around with his yellow pad tonote down any new idea.• He always used to promote a items veryinnovatively.
Made in America:Sam Walton 10Recruiting the team• All along ,history of Wal-Mart has beenmarked by having right people in right jobat right time.• Whitaker- To get it started• Ferold Arend- To get it organised• Jack Shewmaker- To push new ideas• David Glass- To keep cool in crisis andget control
Made in America:Sam Walton 11Taking the Company Public• Due to rapid expansion, Sam accrued ahuge debt.• To get relief, he went public.• Over the years, even though many haswritten them off, Wal-Mart stock did verywell
Made in America:Sam Walton 12Building the Partnership• Sam attributes Wal-Mart’s unbelievableprosperity to the relationship managersenjoy with its associates, employees in thestore.• They have a profit sharing plan for all theassociates.• Information is also shared with associatesto give them a sense of partnership.
Made in America:Sam Walton 13Making Customer Number One• Sam always believed in secret ofsuccessful retailing is to give customerswhat they want.• Strong customer demand in small townsmade it possible for Wal-Mart to getstarted.
Made in America:Sam Walton 14Meeting the Competition• Sam believes that one of the smarteststrategic decision was to meet competitionhead on.• He tributes Kmart and Target forlegitimizing discount stores and alsoacknowledges that competition with themmade Wal-Mart a better company.• Kmart attack on Wal-Mart best externalevent in Wal-Mart’s history.
Made in America:Sam Walton 15• Sam always experimented with differentconcepts like Hypermart, Discount drugconcept and Sam’s club.• Sam’s club now is a $10 billion businesswith huge growth potential.• Sam’s club was result of competition fromPrice club stores.
Made in America:Sam Walton 16Expanding the Circles• Wal-Mart is known for its distribution andtransportation system.• Sam always put up a good fight wheneversomebody wants to buy a new system.• He tributes David Glass, Jack Shewmakerand Ron Meyer for putting pressure onhim for new systems.• They were the first to use satellite inretailing
Made in America:Sam Walton 17• “So you see, technology and distributionare every bit important to Wal-Mart’sability to grow and maintain control. But,don’t let anybody kid you. Without the rightmanagers, and dedicated associates andtruck drivers all across the system, all thatstuff is totally worthless.”
Made in America:Sam Walton 18• Think one store at a time• Communicate, Communicate,Communicate• Keep your ear to the ground• Push responsibility and authority down• Force ideas to bubble up• Stay lean, fight Bureaucracy
Made in America:Sam Walton 19Running a successful company1. Commit to your business. Believe in it more than anybodyelse.2. Share your profits with all your associates and treat themas partners.3. Motivate your partners. Money and ownership alone arenot enough4. Communicate everything you possible can to yourpartners.5. Appreciate everything your associates do for the business.6. Celebrate your successes.7. Listen to everyone in your company.8. Exceed your customers’ expectations.9. Control your expenses better than your competition.10.Swim upstream.
Made in America:Sam Walton 20Giving something back• He discusses how he gave somethingback to the community in terms ofscholarships etc.• Another issue he discusses is Wal-Martbeing the huge importer of overseasmerchandise.• He says in too many cases importing isreally their only option as American goodsare simply not competitive.
Made in America:Sam Walton 21• He accepts that Wal-Mart had fallen into apattern of knee-jerk import buying withoutlooking at alternatives.• Today, Wal-Mart instructs their suppliersto look for alternatives in America itself.• He criticizes the Unions for not believing infree market and new solutions and beinginterested in only Union jobs.
Made in America:Sam Walton 22Wanting to Leave a Legacy• Sam believes in global economy, successfulbusiness is going to do just Wal-Mart is alwaystrying to do: give more responsibility for makingdecisions to the people who are actually on firingline.• He would like to see American industrychallenge Japanese industry like auto industry.• Thinks American management has bent too fartowards taking care of itself first.
Made in America:Sam Walton 24Criticism of his business policies• Walton was to the faith of consumerism what theMahatma Gandhi was to nonviolence” – Bob Ortega• Despite Wal-Marts claims of Made in Americaprogram, much of Wal-Marts merchandise was and ismade overseas.• The history of the company, he writes, provides ampleevidence that Wal-Mart, like any corporation, is merely amachine, an amoral construct with one imperative: theprofit motive. That pursuing that motive to the utmostmay have a corrosive effect on communities orindividuals -- including people within the corporation --never enters into the equation.
Made in America:Sam Walton 25Criticism of his business policies• Unfortunately, what America demands is not fairness ordecency, but cheap goods and lots of them. Its calledcapitalism.• A stingy low-wage employer with an arrogant disregardfor local and national laws . – The Nation• What do you get when you cross gutted labor laws with a corporateculture of impunity? Why, Wal-Mart, of course!• Who pays for Wal-Marts cheap products from China: theworkers who make them.• Managers are trained to call a special hotline at the firstsign of suspicious behavior, including “employees talkingin hushed tones to each other.”
Made in America:Sam Walton 26Criticism of his business policies• “From the Chairperson of the ‘Board’ downto the front-line manager … the entiremanagement staff should fullycomprehend and appreciate exactly whatis expected of their individual efforts tomeet the union free objective.”• Open Doors, Closed Minds
Made in America:Sam Walton 27Criticism of Made in America• Sam Walton says, he didnt believe ingiving "any undeserving stranger a freeride."• "We feel very strongly," he wrote, "thatWal-Mart really is not, and should not be,in the charity business."• He did not believe in being generous withcompany profits.
Made in America:Sam Walton 28Criticism of Made In America• Money that Wal-Mart donated to charity,he reasoned, would only come out of thepockets of "either our shareholders or ourcustomers." (He didnt mention workers,perhaps a tacit acknowledgment thatpicking their pockets was just business asusual.)
WALMART AT PRESENTMike Duke (President & CEO)S. Robson Walton (Chairman)• The company is the worlds third largestpublic corporation• Biggest private employer in the world withover two million employees• Largest retailer in the worldMade in America:Sam Walton 29
“Walmart remains a family-owned business,as the company is controlled bythe Walton family who own a 48% stake inWalmart””Its operations in the United Kingdom,South America and China are highlysuccessful, whereas ventures in Germanyand South Korea were unsuccessful”Made in America:Sam Walton 30
Other NamesWalmart has 8,500 stores in 15 countries,under 55 different namesUS – WalmartMexico – WalmexUK – AsdaIndia – Best PriceMade in America:Sam Walton 31
Types of Walmart Stores• Walmart Discount Stores51,000 square feet to 224,000 square feet• Walmart Supercenter98,000 to 261,000 square feet• Walmart Neighbourhood Marketaverage about 42,000 square feetMade in America:Sam Walton 32
• Supermercado de WalmartWalmart opened "Supermercado deWalmart" locations to appeal to Hispaniccommunities in the United States• Marketsidechain of four grocery stores, all in the stateof ArizonaMade in America:Sam Walton 33
• Walmart Expresssmaller discount store, with a range ofservices, from simple grocery shopping, tocheck cashing, and even gasoline service• Sams Clubchain of warehouse clubs whichsell groceries and general merchandise,often in large quantities.Made in America:Sam Walton 34
Walmart International“Walmarts international operations currentlycomprise 4,263 stores and 660,000workers in 15 countries outside the UnitedStates. There are wholly ownedoperations in Argentina, Brazil, Canada,and the UK.”Made in America:Sam Walton 36
Competition• North America - Kmart, Target, ShopKoand Meijer• Canada - Zellers, Hart the Real CanadianSuperstore and Giant Tiger• Mexico –Commercial Mexicana, SorianaMade in America:Sam Walton 37