• The company was founded by Sam Walton in 1962, is headquartered in Bentonville, Arkansas.• Wal-Mart has 8,500 stores in 15 countries, under 55 different names.• No. 1 Retail giant topping in Fortune 500 Inc.
COMPETITVE ACTIVITIES FIT & SCOPE TRADE-OFFsADVANTAGE - Economies of scale Efficient distribution; match1. Distribution e.g. cross-docking, volume-based strategy - ExpenseCapabilities predominance of - Cost savings from - Requires WalMart’s lower inventory partnership own distribution levels relationship with centres, and “inside- - Cost-savings can suppliers out” translate into - Requires location strategy lower prices and more sophisticated IT customer Satisfaction Wal-Mart integrates - Improves supply chain -Relatively high2. Partnership suppliers via IT and and lowers cost of goodsRelationship treats them well in distribution costs soldwith Suppliers terms of pricing; they - Additional cost savings - Requires are more partners than from elimination of integrated IT “value takers” manufacturer reps - Access to sales & inventory info.
COMPETITVE ACTIVITIES FIT & SCOPE TRADE-OFFsADVANTAGE - Useful data for suppliers - Improves customer 3. Advanced satisfaction through more Data-Mining Active collection accurate forecasting of and usage of demand Expense and time customer purchase - Improved matching of behaviour info supply and demand, creates superior sales/ sq ft - Improves customer satisfaction through low - Only possible so 4. EDLP Maintenance of prices long as you really “EVERY - Matches volume-driven have the lowest DAY LOW strategy prices PRICES” - Drives down costs through less advertising.
• One Idea is to use micromarketing, where stores are clustered into groupings based on their specialized markets, Wegmans can utilize micromarketing by offering Large packs for stores in family-oriented neighbourhoods and prepared single- serving portions for stores with a high proportion of single residents.
• Costco can adopt unbundled pricing in order to curb cost. In this way, it can charge separate prices for an appliance, delivery, installation, and carting away of the old appliance. This unbundling strategy satisfies the needs of both the low- cost segment and full-service customer segments. Unbundled pricing also enables a retailer to match the price of low-cost retailers that do not provide ancillary services. It also charges customers for only those services that they desire.
• Another strategy is to adopt E-commerce, Many bricks-and-mortar retailers have web sites that offer a different selection of goods and services. Some retailers use the Web as a means of promoting the sale of closeouts and broken lots. Both Wegmans & Costco must use the Web as a means of selling distinctive merchandise that appeals to markets too small for their traditional store-based channel.
• Wegmans must exploit the these two key market segments in order to compete with Wal-Mart:-• Organic & Frozen food Segment, and,• Backward Integration into Supply Chain
• Costco although having mass loyal customer base but it always ignored the power of E-commerce. Costco should deveop an online ordering system and delivery service, which allows customers to browse Costco products from an online inventory and have them shipped directly to their homes or businesses.
• Wegmans Family owned management structure emphasized only on having business in certain cities where their roots exists. In this global war of retails Wegmans must review its business expansion strategy in the means of Transnational as well as Remote Domestic market.