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Transcript of COMPANY PROFILE
Founder: Sam Walton
Headquartered in Bentonville, Arkansas
Revenue : fiscal year 2013 sales of approximately $466 billion
Employees: 2.2 million associates worlwide
10,900 retail units under 69 banners in 27 countries and e-commerce websites in 10 countries.
First Walmart store opened in Rogers, Arkansas in 1962.
Sam Walton's strategy was built on an unshakeable foundation: The Lowest Prices Anytime, Anywhere.
The company officially incorporated as Wal-Mart Stores, Inc.
Walmart Goes National
Walmart became a publicly traded company. The first stock was sold at $16.50 per share.
Walmart was listed on the New York Stock Exchange (WMT).
With 51 stores, Walmart recorded sales of $78 million.
The first Walmart Supercenter (1988)
Efficient supply chain management (Removing a few of the chain’s links.)
Technology for low-cost. Wal-Mart established it own satellite communication in the earlier 1980s
Supply chain initiative called VMI — vendor managed inventory
1. Scale of operation
2. Competence in information systems
3. Wide range of products
4. Cost leadership strategy
5. International operations
1. Lack understanding of differences between markets. (geographically)
2. Focused on all American products.
1. Retail market growth in emerging markets
2. Rising acceptance of own label products
3. E-commerce growth
1. Increasing competition
2. Rising commodity prices
President and CEO
Chairman of the Board of Directors
Charles M. Holley Jr
Mike Duke became CEO. (2009)
Walmart.com was founded, allowing U.S. customers to shop online.
VISION AND MISSION
EDLP- Every Day Low Price
Walmart went global, opening a Sam’s Club in Mexico City.
Help people save money so they can live better.
Lower cost of living for everyone.
Walmart United States
Supply chain: Cross Docking system
Able to generate large sales volume (economies of scale)
Competes in the retail industry
3 business segments: Walmart U.S, Walmart International, Sam's Club.
International: 26 countries
Focus on Joint Ventures with strong local supermarket operators.
International growth approaches:
Acquiring established dominant hypermarkets,
Acquiring weaker players
Building its own stores.
“Price match guarantee“ Challenge competitors to reduce price
Services: Hair Salon, Photo Developer, Optical Shops
Staging and Pacing
Expand market share by leveraging their scale, technology and passion for low prices.
Became international in 1991, started with Canada and Mexico.
Walmart's way of keeping prices low.
3. Perception of quality
Averaging 120,000 to 130,000 square feet.
Products: Regular retail items
Services: Photo developing, hair salons, optical shops.
90,000-100,000 square feet in size
Offer electronics, apparel, toys, home furnishings, health and beauty aids, hardware
Ideal format for urban and rural areas that lack access to larger stores.
15,000 square feet
Offer groceries, general merchandise and even pharmacies.
Approximately 38,000 square feet
Offer fresh produce, meat and dairy products, bakery and deli items, household supplies, health and beauty aids and a pharmacy.
Warehouse membership format with locations across the U.S. and around the world.
High-volume, low-cost merchandising.
Catered to businesses, and charged a membership fee which made up to two-thirds of the operating profits.
Puerto Rico: Concern for anti-monopoly laws.
Canada: Failed marketing- language differences
Brazil: Distribution- local suppliers having difficulty handling quality control packaging from Wal Mart's standards.
Consumer preferences :
Refuse to accept supplier's price-setting, selling some items at a loss to maintain competitiveness.
E.g: selling beer cans at 6 cents below wholesale.
Poor in presence.
Purchasing customs- customers make small purchases repeatedly.
Weights cost on shopping bags.
Legal issues: retailers could not sells below cost.
Prohibited to stay open 24 hours, could not open on a Sunday.
Germans did not like the greeters' welcome. (did not want to pay salary for "the guy at the door")
KOREA: Space constraint(built in a shopping center). Minimum Cultural adaptation.
U.K: Acquired 229 Stores of Asda Croup (U.K's largest supermarket chain.) for $10.7 billion.
JAPAN: Perception of Quality. March 2002: suffer economic weakness and price deflation. Aggressive Competition: Carrefour, and Ito-Yokado and Aeon Corp.
RUSSIA: Predicted the next global destination for retailing giant.