Introduction to Wal-Mart An American public corporation that runs a chain of large discount department stores & warehouse stores. World's largest public corporation by revenue. Largest private employer in the world. Fourth largest utility or commercial employer. Largest grocery retailer in the United States. Largest toy seller in the United States. World’s biggest retailer.

2.  Introduction to Wal-Mart
 An American public corporation that runs a chain of large
discount department stores & warehouse stores.
 World's largest public corporation by revenue.
 Largest private employer in the world.
 Fourth largest utility or commercial employer.
 Largest grocery retailer in the United States.
 Largest toy seller in the United States.
 World’s biggest retailer.
Introduction

3. • Founded by Sam Walton in 1962
• Incorporated on October 31, 1969.
• Publicly traded on the New York Stock
Exchange in 1972.
• Walmart operate retail stores in various
formats across the world
Company Overview

4. Company Overview

5. • Founded : Arkansas, USA (1962) by Sam Walton.
• Headquarters : Bentonville, Arkansas, U.S.A.
Company Overview

6. Slogans:
 The Lowest Prices. Guaranteed!
 Save Money, Live Better
 We Sell For Less Everyday!
Company Overview

7.  1918: Born in a farmer’s family in Kingfisher,
Oklahoma.
 1940: Graduated from the University of Missouri.
 1950: Gave up job and opened his first store in
Arkansas.
 1962: Walten Brothers opened fist Walmart in
Arkansas.
History of Walmart

8. “To be the best retailer in the hearts and
minds of consumers and employees.”
Vision

9. “Saving people money so they
can live better.”
Mission

10. Slogan Save Money. Live better.
Slogan

11. Business Description
Product
•Dry and wet grocery
•Beverages
• Frozen food
Brand
•Walmart
•Great value
•Sam’s choice
Service
•Photo processing service
•Cellular service plan
• Money order

12. Integrity Opportunity
Family and
Community
Purpose Responsibility
Values of Walmart

13.  Sam Walton gave 3 Policy Goals to define Wal-Mart's
business:
The Corporate Strategy
Respect
for
Individual
Strive for
Excellence
Service for
Customer

14.  The Corporate Strategy Dominance in the Retail
Market.
 Expansion in the U.S. and International Markets.
 Creation of Positive Brand and Company
Recognition.
 Branch Out into New Sectors of Retail.
The Corporate Strategy

15. • Consistently stock the shelves with a wide range of
goods at low prices.
• Keep the store open later than most other stores,
especially during the Christmas season.
• Discount Merchandising.
Buy wholesale goods from the lowest priced supplier.
Pass on the savings to the customer.
Sam Walton’s Practices

16.  Three successful elements and a fourth element of
Walmart strategy formulation:
1. Dominate the Retail Market wherever Wal-Mart has a
presence.
 Wal-Mart is primarily a discount retailer.
 Lowering the markup, and earn profit on the
increased volume of sales.
 Competitiveness of every unit.
Strategic Goals

17. 2. Growth by expansion in the US and Internationally.
 Gain entry into a nation by Corporate Takeover of a national
retailer.
 Once the company is bought, WalMart converts the stores
into Wal-Mart stores.
3. Create widespread name recognition and customer
satisfaction with the Wal-Mart brand, and associate the retailer
with the reputation of offering the best prices.
 The company accomplishes this through television advertising
campaigns and newspaper adverts.
 The company engages in partnerships and cobranding.
Strategic Goals

18. 4. Branching out into new sectors of retailing such as
pharmacies, automotive repair, and grocery sales. •
Move into the grocery store business with its new
"Neighborhood Markets."
Strategic Goals

19. Competitors

20. Low Cost Leadership. The giant retailer prides itself
on providing customers with low-cost items that beat
competitors.
Differentiation Strategy. WalMart uses the
differentiation strategy to succeed by creating a
product or service unique to customers. WalMart has
achieved this strategy by offering unique warranties
and brand images exclusive to the store.
Competitive Strategy

21.  The company's competitive strategy is to dominate every
sector where it does business.
 It measures success in terms of sails and dominance over
competitors.
 Sell goods at low prices, outsell competitors, and to
expand.
 To build more stores, make existing stores bigger, and to
expand into other sectors of retail.
 Every step of the way, it strives to make money and
dominate its competitors, to the point of putting some
competitors out of business.
Competitive Strategy

22. Low Cost Leadership Strategy: Walmart’s value
proposition is based on offering Everyday Low Price
(EDLP). This is the core of Walmart’s Business Model and
the rest of the key features of Walmart’s Business Model
are aligned to keep the everyday low price.
 Pressure Over Vendors: To deliver low price, Walmart
exchanges information on sales and inventory levels based
on “Vendor Partnership” concept. It has its own
distribution channel which is a major distribution channel
for many vendors.
Business Strategy

23. Investment in Technology: Walmart invested heavily
on technology to help enhance communication
between headquarters, stores, and vendors. As a
result inventory costs decreased and inbound
logistics became more efficient.
Human Resource Policy: Walmart was recognized as
one among 100 best companies to work for in
America. It used to offer a percentage of store profit
as incentives to store managers.
Business Strategy

24. Location Selection: Walmart focused on rural suburban
areas ignored by other companies. Establishing stores
close to distribution center, it developed a dense
distribution network that allowed the firm to spread costs
and exploit economies of density.
Product Selection: Walmart gives its customers a wide
range of selection. It offers grocery items in super centers.
Sam’s club caters to the wholesale purchase need of
customers.
Business Strategy

25. Cost Consciousness: Walmart developed a cost conscious
culture for the company to reduce costs whenever
possible. It controlled costs by systematic elimination of
superfluous expenses.
Customer Service: Walmart implemented policies to create
friendly shopping environment for customers. It started its
“Aggressive Hospitality” program in 1984, where
customers were received by “people greeters” and they
enjoyed benefits such as extended opening hours, free
parking, no hassle refund and exchange policies, speedy
checkout lanes, wider aisles, and clean stores.
Business Strategy

26. 1. Economies of Scale
2. Supply Chain with Integrated Technology
3. Superior Logistics Systems
4. Decentralized Operations
5. Every Day Low Prices
Key Success Factors

27. 1. Bargaining Power of Customers: Low.
Customers usually make small purchases.
A large number of customers.
Wal-Mart’s main customers are individuals.
Five Forces Model

28. 2. Bargaining Power of Suppliers: Medium-Low.
 Wal-Mart purchases huge quantities of products
from its suppliers.
Low switching costs from one supplier to another.
 Products have a lot of substitutes.
Five Forces Model

29. 3. Potential Entrants / Barriers to Entry: Medium-High.
 Economies of scale.
High capital requirements.
Customers mainly look for products with low prices
and standard quality.
Requires a precise distribution system.
Five Forces Model

30. 4. Threat of Substitutes: High.
Prices and quality of substitute products are very
competitive.
Consumer switching costs are low.
Five Forces Model

31. 5. Potential Competitors/ Rivalry: High.
Wal-Mart represents the 25% share of the U.S.
supermarket business.
Competitors have similar sizes.
Industry growth is slow.
Exit barriers are high.
Five Forces Model

32. Thank You