Sam Walton

Made in America:Sam Walton 1
SAM WALTON
Made in America
By
K.Prashanth 03010420
K.Vidya Sagar 03010315
Sultan Ahmed 03010432
Introduction
Samuel Moore Walton (March 29,1918-April
6,1992)
Founder of Wal-Mart
Declared richest man in America in October
1985 by Forbes.
Born in 1918 in Kingfisher, Oklahoma during the
Great Depression.
Made in America: Sam Walton
Sam Waltons father Thomas Walton was
a hard worker and loved to trade.
He learned from early age to help provide
for the home.
Started selling magazine subscriptions
and also had paper routes from very
young age.
To Value a Dollar
Sam always set extremely high personal
goals.
Played football, baseball and basketball
and became youngest Eagle Scout in the
history of Missouri at that time.
Graduated from University of Missouri in
1940 with a business degree.
Since high school he paid for all his
expenses
To Value a Dollar
First Job
Sam joined JC Penney, a retailing
company, as a management trainee.
There watching store manager he got
excited about retailing.
But due to war he had to resign the job
and move in 1942.
He married Helen in 1943 while still on
commission.
Starting on a Dime
Sam learned much about money and
finances from Helens father.
He purchased a store in Newport,
Arkansas, a Ben Franklin franchise.
He learned a lot from running a store in
franchise program.
Wal-Marts philosophy
In his store, he would buy an item for 80
cents, priced it to sell at $1.00 and sell
three times more of it than by pricing it at
$1.20. The overall profit was much
greater. By cutting the price, it boosted
the sales to a point where it earned far
more at the cheaper retail price than it
would had by selling the item at the higher
price.
Bouncing Back
Due to lease contract,he has
to sell his store and move.
It led him to bigger and better
things
Sam moved with his family to
Bentonville, Arkansas to open
self-service Five & Dime store
which at that time was a new
concept.
Bouncing Back
He expanded very rapidly and opened
many variety stores.
But, a new concept of discount store came
into existence and Sam immediately
sensed that discount idea was the future
First Wal-Mart
He built a store in Rogers, Arkansas.
Nobody wanted to gamble on it so Sam
has to put up 95 percent.
Sam always checked on competition and
always went around with his yellow pad to
note down any new idea.
He always used to promote a items very
innovatively.
Raising a Family
Sam and Helen had four kids: three boys
and a girl.
Helen always insisted on living in small
town so that they could raise their children
with same values they has been exposed
to.
All four worked for Wal-Mart from young
age and even invested in it over years.
Recruiting the team
All along ,history of Wal-Mart has been
marked by having right people in right job
at right time.
Whitaker- To get it started
Ferold Arend- To get it organised
Jack Shewmaker- To push new ideas
David Glass- To keep cool in crisis and get
control
Taking the Company Public
Due to rapid expansion, Sam accrued a
huge debt.
To get relief, he went public.
Over the years, even though many has
written them off, Wal-Mart stock did very
well
Building the Partnership
Sam attributes Wal-Marts unbelievable
prosperity to the relationship managers
enjoy with its associates, employees in the
store.
They have a profit sharing plan for all the
associates.
Information is also shared with associates
to give them a sense of partnership.
Making Customer Number One
Sam always believed in secret of
successful retailing is to give customers
what they want.
Strong customer demand in small towns
made it possible for Wal-Mart to get
started.
Meeting the Competition
Sam believes that one of the smartest
strategic decision was to meet competition
head on.
He tributes Kmart and Target for
legitimizing discount stores and also
acknowledges that competition with them
made Wal-Mart a better company.
Kmart attack on Wal-Mart best external
event in Wal-Marts history.
Sam always experimented with different
concepts like Hypermart, Discount drug
concept and Sams club.
Sams club now is a $10 billion business
with huge growth potential.
Sams club was result of competition from
Price club stores.
Expanding the Circles
Wal-Mart is known for its distribution and
transportation system.
Sam always put up a good fight whenever
somebody wants to buy a new system.
He tributes David Glass, Jack Shewmaker
and Ron Meyer for putting pressure on
him for new systems.
They were the first to use satellite in
retailing
So you see, technology and distribution
are every bit important to Wal-Marts ability
to grow and maintain control. But, dont let
anybody kid you. Without the right
managers, and dedicated associates and
truck drivers all across the system, all that
stuff is totally worthless.
Thinking Small
well, now, Sam, how big do you really
want this company to be? What is your
plan?
-FEROLD AREND
Ferold, were going to take it as it comes,
and if we can grow with our own money,
well maybe add a store or two.
-SAM WALTON
Think one store at a time
Communicate, Communicate,
Communicate
Keep your ear to the ground
Push responsibility and authority down
Force ideas to bubble up
Stay lean, fight Bureaucracy
Running a successful company
1. Commit to your business. Believe in it more than anybody
else.
2. Share your profits with all your associates and treat them
as partners.
3. Motivate your partners. Money and ownership alone are
not enough
4. Communicate everything you possible can to your
partners.
5. Appreciate everything your associates do for the business.
6. Celebrate your successes.
7. Listen to everyone in your company.
8. Exceed your customers expectations.
9. Control your expenses better than your competition.
10.Swim upstream.
Giving something back
He discusses how he gave something
back to the community in terms of
scholarships etc.
Another issue he discusses is Wal-Mart
being the huge importer of overseas
merchandise.
He says in too many cases importing is
really their only option as American goods
are simply not competitive.
He accepts that Wal-Mart had fallen into a
pattern of knee-jerk import buying without
looking at alternatives.
Today, Wal-Mart instructs their suppliers
to look for alternatives in America itself.
He criticizes the Unions for not believing in
free market and new solutions and being
interested in only Union jobs.
Wanting to Leave a Legacy
Sam believes in global economy, successful
business is going to do just Wal-Mart is always
trying to do: give more responsibility for making
decisions to the people who are actually on firing
line.
He would like to see American industry
challenge Japanese industry like auto industry.
Thinks American management has bent too far
towards taking care of itself first.
CRITICISM
Criticism of his personality
Modest, down-to-earth and ''casually
relentless''
Gentlemanly, modest and notoriously
chintzy
A gifted leader

Criticism of his business policies
Walton ''was to the faith of consumerism what the
Mahatma Gandhi was to nonviolence Bob Ortega
Despite Wal-Mart's claims of ''Made in America''
program, much of Wal-Mart's merchandise was and is
made overseas.
''The history of the company,'' he writes, ''provides ample
evidence that Wal-Mart, like any corporation, is merely a
machine, an amoral construct with one imperative: the
profit motive. That pursuing that motive to the utmost
may have a corrosive effect on communities or
individuals -- including people within the corporation --
never enters into the equation.''
Unfortunately, what America demands is not fairness or
decency, but cheap goods and lots of them. It's called
capitalism.
A stingy low-wage employer with an arrogant disregard
for local and national laws . The Nation
What do you get when you cross gutted labor laws with a corporate
culture of impunity? Why, Wal-Mart, of course!
Who pays for Wal-Mart's cheap products from China: the
workers who make them.
Managers are trained to call a special hotline at the first
sign of suspicious behavior, including employees talking
in hushed tones to each other.
From the Chairperson of the Board down
to the front-line manager the entire
management staff should fully
comprehend and appreciate exactly what
is expected of their individual efforts to
meet the union free objective.
Open Doors, Closed Minds
Criticism of Made in America
Sam Walton says, he didn't believe in
giving "any undeserving stranger a free
ride."
"We feel very strongly," he wrote, "that
Wal-Mart really is not, and should not be,
in the charity business."
He did not believe in being generous with
company profits.
Criticism of Made In America
Money that Wal-Mart donated to charity,
he reasoned, would only come out of the
pockets of "either our shareholders or our
customers." (He didn't mention workers,
perhaps a tacit acknowledgment that
picking their pockets was just business as
usual.)
Wal-Mart's 'China Price : Injecting
humanity into dry economic numbers
"Customers of Wal-Mart: when you wear
expensive clothes, when your children
play with high-quality toys, think of China
and the Far East." Another adds: "Those
profits you made and the wonderful life
you made are the sweat, and tears and
overtime work of Chinese people."

Sam Walton

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