The document outlines Walmart's competitive advantages, including first-mover advantages and employee-centric values, alongside its lower pricing strategies and efficient distribution systems. It highlights challenges such as stagnant growth, increasing competition, and brand image issues due to lawsuits. The food retailing sector is identified as attractive but competitive, suggesting that independent players must adapt to supercenter models to improve margins.

1. Competitive Advantage
 First Movers advantage- One third stores were
located in areas not served by others.
 Employee centric Values- employee Benefits
 Walmart advertisement expense was 1.5% of
discount store sales.
 Differential pricing based on local demands and
competition. 2-4% below competitors
 Rental expenses only 3% while 3.3% for
competitors.

2. Competitor Advantage(Cont)
 Installation of Satellite System Electronic Scanning
of Uniform product code at point of sale for
improved efficiency and accurate pricing.
 Distribution via Cross Docking and direct supply
from 27 distribution centres.
 Electronic Date interchange- Suppliers received
daily sales records. They could accordingly
forecast, plan and supply. Reducing Inventory cost

3. SWOT ANALYSIS

4. Sustainability in the Market
 Announcement of growth in comparable store sales
to 7-8% led to share price drop.
 Enormous size and stagnant economy
 Growing Competition
 Multiple Law suits for low prices leading to fall of
brand image.

5. BCG Matrix

6. Food Retailing
 Attractive Industry ($ 380 billion) – Food retail
accounted for 40% sales of supercenters.
 Primarily made up of regional and local operators.
Low margins at present. Wal*Mart can leverage its
economies of scale.
 High competition present and more new entrants
expected.

7. Food Retailing
 Independent players need to move to a supercenter
model to increase margins (Barriers to entry)
 Acquisition of experienced distributors will add to
Wal*Mart’s competitive advantage.