Walmart has experienced significant growth and success since its founding in 1945. Sam Walton opened the first Ben Franklin franchise and later founded Walmart in 1962. Through the 1970s, Walmart began expanding rapidly across the US. By 1999, Walmart stock was named the #1 stock on the Dow Jones Industrial Average. The document discusses Walmart's competitive advantages in discount retailing, including its large store footprint and proximity to customers, low prices, and efficient supply chain and inventory management systems. It also considers the sustainability of Walmart's advantages in 1986 and whether Sam's Wholesale Clubs were likely to achieve similar success to Walmart's discount stores.

1. STRATEGIC
MANAGEMENT
Case Study Analysis –
(Walmart Discount
Operations) Submitted to – Dr. MA Akbar
Submitted by – GROUP 3
Himanshu Talmale – 20DM084
Manish Jindal – 20DM114
Mihir Manchanda – 20DM120
Mohammad Sohail – 20DM122
Pallavi Goel – 20DM147
Piyush Hirwani – 20DM151

2. Historyof
Walmart
In 1945 Sam Walton
opened the first Ben
Franklin franchise in
Newport Arkansas and
operated them with his
wife, Helen and brother,
Bud.
• These were small
chains
that were very
successful.
• In November of 1962
Wal-Mart was opened.
• Wasn’t until mid 1970’s
that Wal-Mart began to
grow.
1st IPO in 1970.
Then 100 shares were
worth $1,650 dollars and
now the same 100 shares
are worth more than $6
million dollars.
In 1999 named #1 stock
on the Dow.

3. Contoso Ltd.
Q1. What, historically, has been Wal-Mart’s key
sources of Competitive advantage in discount
retailing?
 The Industry is attractive
 Right timing
 Better informed customers – supermarkets and TV
 Government standards
 Low prices
 Number of stores – in small as well as large towns
– proximity to the customer home (an expansion
plan of “Pushing from inside out”
 Well treated Employees
 Wide variety of goods (hardware, clothes and
food)
 Good relationship with vendors
 Good communication network

4. Firm Infrastructure:
•High store volume
•No regional Headquarters
•IT support systems for
managerial decisions
•Human Resource
Management:
•Introduction of senior
manager with background
outside retailing (IT)
•Higher sales volume /
employee
SUPPORT
ACTIVITIES

5. Technological
Development
• It uses centralized purchasing
system.
• Installed computerized system to
track inventory.
• Switching to electronic scanning of
the Uniform Product Code (UPC) at
the point of sale.
• Using computer aided design.

6. Q2.) How sustainable is Wal-Mart’s
CompetitiveAdvantage in discount
retailing in 1986?
 Sustainability at the top place is
the most important job that
makes its managers strives
hard to frame the policies and
strategy to compete with its
rivals in the market.
 Wal-Mart with its visionary goal
of attaining zero waste status
and reaching 100% renewable
energy has planned to launch
number of sustainability
initiatives.
 Wal-Mart is planning to open
convenience stores as Tesco
has started and operating in US
called Fresh & Easy
Neighborhood Markets.

7. Contoso Ltd.
 Sustainable due to size and relationship with
suppliers
 Some aspects can be replicated by
competitors
– Hub and spoke model
– Buying directly from the manufacturer
 However difficult to replicate due to necessary
capital and size
DistributionNetwork
Sustainability

8. InformationSystemand
CostControlSustainability
Partly sustainable
•The technological system itself can
be replicated/purchased
•Capabilities difficult to replicate
–Partnerships
–Superior supply chain
management
Sustainable
•Bargaining power is difficult to
replicate
–Influence
–Disintermediation
•Ability to keep indirect costs low
–Culture of frugality
•Difficult to imitate
–Labour costs
•Exclusion of unions

9. Q3. Will Sam’s Wholesale Clubs prove as
big a success for Wal-Mart as its discount
stores?
Yes, Sam’s Wholesale clubs has proven to
be a success for Walmart as its discount
stores
 Targeting Untapped Markets and
taking the first movers advantage
 They already had an existing customer
base
 They could save marketing cost by
advertising through their marketing
channel
 Investors of Walmart were confident
on their management
 We could witness exponential growth
of this market as revenue figure
stands at $43 million in 1983 to $777
million in 1985 with a CAGR of 500%
approx