Wumart has several competitively distinct resources that form the basis of its competitive advantage regionally and domestically. These include its strategic relationships that provide access to prime retail locations, its early adoption of information technology, geographical advantages, its widely recognized brand image, and its strong corporate culture emphasizing respect, responsibility, innovation and attention to detail. Domestically, its control over its brand value and the difficulty for competitors to substitute its resources are also distinct competitive advantages.

1. WUMART STORES
Resources and capabilities
Henrik Engervall (20848@student.hhs.se)
Erik Ingemansson (egjin@kth.se)
Karl Nielsen (40201@student.hhs.se)
Teresia Schullström (tsch@kth.se)

2. Principal resources and capabilities that form the
basis of Wumart’s competitive advantage:
1. Strategic relations
• Extensive network with prime locations thanks to SOE’s
• Future expansion potential thanks to good relations
2. The earliest among domestic retailers to realize the importance
of information technology in the development of a retail chain
3. Geographical advantage / Physical uniqueness
4. Widely recognized brand image of reliability, quality and value for
money.
5. Strong corporate culture characterized by respect, a strong
sense of responsibility and co-operation, innovation and
learning, and great attention to details.
6. Zhang Wenzhong

3. Regionally
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2.
3.
4.
5.
6.
It is hard to copy yes no yes yes yes yes
It depreciates slowly
yes no yes yes yes yes
Your company controls its value yes yes yes yes yes no
It can not be easily substituted yes no yes yes yes yes
It is better than competitorsʼ similar resources
yes yes* yes yes yes yes
Pass or fail?

4. Wumart’s competitively distict resources
(regionally):
1. Strategic relations
• Extensive network with prime locations thanks to SOE’s
• Future expansion potential thanks to good relations
2. The earliest among domestic retailers to realize the importance
of information technology in the development of a retail chain
3.Geographical advantage / Physical uniqueness
4.Widely recognized brand image of reliability,
quality and value for money.
5.Strong corporate culture characterized by
respect, a strong sense of responsibility and co-
operation, innovation and learning, and great
attention to details.
6. Zhang Wenzhong

5. Domestically
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po ality ant
cu d v
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dv
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la
zh
ca
hi
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W
ap
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d,
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gr
at
an
an
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or
el
Zh
Br
IT
G
R
C
1.
2.
3.
4.
5.
6.
It is hard to copy - no - yes yes yes
It depreciates slowly
- no - yes yes yes
Your company controls its value - yes - yes yes no
It can not be easily substituted - yes - yes yes yes
It is better than competitorsʼ similar resources
- no - no yes? yes
Pass or fail?

6. Wumart’s competitively distict resources
(domestically):
1. Strategic relations
• Extensive network with prime locations thanks to SOE’s
• Future expansion potential thanks to good relations
2. The earliest among domestic retailers to realize the importance
of information technology in the development of a retail chain
3. Geographical advantage / Physical uniqueness
4. Widely recognized brand image of reliability, quality and value for
money.
5.Strong corporate culture characterized by
respect, a strong sense of responsibility and co-
operation, innovation and learning, and great
attention to details.
6. Zhang Wenzhong

7. International
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ltu alu
po ality ant
cu d v
g
dv
en re
on
la
zh
ca
hi
te
qu
ns
W
ap
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io
d,
g
gr
at
an
an
eo
or
el
Zh
Br
IT
G
R
C
1.
2.
3.
4.
5.
6.
It is hard to copy - no - yes yes yes
It depreciates slowly
- no - yes yes yes
Your company controls its value - yes - yes yes no
It can not be easily substituted - yes - yes yes yes
It is better than competitorsʼ similar resources
- no - no yes? no
Pass or fail?

8. Other Industry
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la
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d,
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gr
at
an
an
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or
el
Zh
Br
IT
G
R
C
1.
2.
3.
4.
5.
6.
It is hard to copy yes no - yes yes yes
It depreciates slowly
yes no - yes yes yes
Your company controls its value yes yes - yes yes no
It can not be easily substituted yes no - yes yes yes
It is better than competitorsʼ similar resources
yes yes* - yes yes yes
Pass or fail? *

9. Easier to expand in other industries regionally than
internationally as Wumart since most competitive advantages
are local.

10. Suggested improvements for future success:
• How to sustain regional performance?
➡ Guard brand values, political relations, corporate culture and IT
➡ Upgrade expansion pace
➡ Upgrade inventory/product offer
• How to expand domestically?
➡ Upgrade relations outside region
➡ Branding
➡ Invest in prime locations

11. Thank you for listening!

12. Reference list
1. Wumart stores: Chinas response to Wal-Mart
2. Collis, D.J. & Montgomery, C., “Competing on Resources”, HBR, 2008
3. Regnér, P. “Strategy-as-practice and Dynamic Capabilities: Steps towards a
Dynamic View of Strategy”, Human Relations, 2008