Wal-mart Presentation

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Wal-mart Presentation

  1. 1. Wal-Mart ALTA Consulting Stephanie LeVonne, David Taub, Alex Zafrin, Allison Lerner April 17, 2013 1 1
  2. 2. History Issue SWOT Alternatives Recommendation Implementation Conclusion Questions? 2 2
  3. 3. 1962- Invented by Sam Walton 1970- Began Trading Stock 1983- First Sam’s Club opened 1988- First Wal-Mart Supercenter opened 1991-1999- International Expansion 2000- Walmart.com Launched 2010-2011- Net Sales Stagnant 3
  4. 4. Bargaining Power Over Suppliers Frugal Money Management Strengths Brand Recognition and Global Reach Global Acquisitions & Joint Ventures SWOT Analysis—Internal Factors 5
  5. 5. Weaknesses Global company- in few countries Lack of security measures Employee compensation Standardized worldwide approach Lack of market research in other countries SWOT Analysis—Internal Factors 6
  6. 6. 7
  7. 7. Grocery Express Stores E-commerce China & Beyond SWOT Analysis—External Factors 8
  8. 8. Discount Retailers Space Limitations Negative Perceived Image SWOT Analysis—External Factors 9
  9. 9. Alternatives • Pros: Variety of services and products • Cons: Limited room in U.S. markets • Pros: Growth; increased revenues • Cons: Potential failures Build New Supercenters • Pros: Increased spending per customer • Cons: Isolates “core customers” Increase International Expansion Increase Focus on Upper Income Bracket Explore New Store Formats • Pros: Convenience • Cons: Lack of popularity 10
  10. 10. Recommendation 1. E-commerce: • Improvements to mobile app (more user friendly) • RFID checkout system 2. Build more Wal-Mart Express stores (in the US): • Emphasis on groceries and healthy options • Urban markets • Potential for expansion into China 3. Continue to improve brand image: • Appeal to younger demographic (ages 0-20) • Reusable canvas bag giveaways • Paper & plastic option 11
  11. 11. RFID Check-Out System Explained Customer leaves the store without waiting in line Embedded tag reader calculates cost of all items in shopping cart Bill is sent to the bank 12
  12. 12. Advantages of RFID Reduces checkout time Reduces costs Reduces theft Sales associates can spend more time helping customers Assists with marketing & sales research 13
  13. 13. Hire Sourcebits for mobile app development and improvement • Founded in 2006 • Develop apps for iOS, Android, Blackberry, Symbian, and WinPhone platforms • Past clients: GE, Coca-Cola, Intel, Hershey’s • Cost: $100/hour • Begin process as soon as possible Implementation Sector 1 E-commerce 14
  14. 14. • • • • Invest in RFID tags on sales floors Previous failures with RFID Begin with high-risk items After 6 months, move on to lower-risk items Price of RFID Tags, 2010 Quantity Average Price Per Tag 10,000 ~$0.15 100,000 ~$0.12 Implementation Sector 1 E-commerce 15
  15. 15. 16
  16. 16.  Wal-Mart Express—similar to Neighborhood Market concept  Allow for expansion in key urban areas— Boston, Cambridge, Seattle, San Francisco, Stamford, Detroit, and NYC  Will allow Wal-Mart to compete with dollar store chains  Begin process as soon as possible 17
  17. 17. Cost Calculation One Express Cost of one store is about Cost of one supercenter ¼ the size of Express store one ~$23,000,000 $5,750,000 supercenter 18
  18. 18. Implementation Sector 2 Expansion 1. 2. 3. • 2 years after US effort: refocus on China • Stick with supercenter and hypermarket models in heavily populated urban areas • Use Wal-Mart Express model in lesspopulated areas 19
  19. 19. 20
  20. 20. 2009 2010 2011 898 810 708 Number of International Units 3,595 4,099 4,557 US Net Sales Increase from Prior Fiscal Year 7.6% 1.1% 0.1% International Net Sales Increase from Prior Fiscal Year 6.2% 1.3% 12.1% Number of Domestic Discount Stores 21
  21. 21. Appeal to a younger demographic • Advertise for annual events • Reallocate $50 million of last year’s $2.5 billion to new ad campaigns geared toward target audience Implementation Sector 3 - Brand Image (this year) 22
  22. 22. Give away reusable canvas bags for 1 week Offer paper bag optionAverage bag costs approximately $0.10 Bags Average bag costs $0.10-$0.25 to make  $50,000,000 expense Wal-Mart has $7,395,000,000 cash and cash equivalents Implementation Sector 3 -Brand Image (this year) 23
  23. 23. 24 Summary Hire Sourcebits to improve mobile app Invest in RFID tags on sales floors Continue Wal-Mart Express implementation plans Look to China in 2 years Appeal to a younger demographic Bag solutions 24
  24. 24. Questions? 25

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