Walmart

Submitted by:
Sidra Zubair
Jaweria Fayyaz
Moiz Tariq
Mahnoor Qazi

Summary
The first discount department store ( Wal-Mart)
opened in November 1962 by Sam Walton.
Wal-Mart have total 36 department and offer
variety of products.
Its product include housewares, electronics, home
supplies, sporting goods, cameras, shoes, health
and beauty aids and many more.
The company deal with 3600 brands internally
mainly 318 Wal-Mart brands in Canada, 1197 in
Mexico, and 56 in Puerto Rico.

 Wal-Mart faces many competitors which include amazon,

Tesco, Carrefour etc, they all try hard to eliminate price
differentiation.
They have the strategy of cost leadership which is the
key strength for them.
Wal-Mart have high employee turnover.
Wal-Mart start new strategy of retail communication by
establishing neighborhood markets in urban areas.
They are entering in new markets i-e Asian and European
Markets and also focus on product expansion strategy.

Vision Statement
Walmarts vision statement:
To be the best retailer in the hearts and
minds of consumers and employees.

Mission Statement
Walmarts mission statement is
Saving people money so they can live better.

Political
Countries political risk when entrant to new market
Changes in government regulations import duties or
taxes
Political stability is key factor in sustaining profits

Economic
MNC are affected by countries economic condition
Decline in economic conditions lead to less business
Exchange rates also affect the profits
Oil and gas prices positively effect the costs

Social
Increase trend of shopping at one place
Increase of awareness of value for money products
Healthy lifestyle awareness in consumers mind
Culture diversity

Technological
Increase in automation process of business
They can use Data processing as large number of sales
They can use mobile apps
Use of integrated technologies to reduce cost

SWOT
Strengths
1. Strong brand name
2. Multiple divisions and stores catering to different markets
3. Wide variety of merchandise
4. Low cost leadership
5. No use of heavy advertisement
6. 3,600 stores internationally
7. Responding to local needs
8. Involves the community
9. Wide and automateddistribution network
10.Online presence
11.Employee benefits and trainings
12.SAMs customers can buy in bulk at low prices
13.Supply chain efficiency
14.Strong financial position
15.Low prices

 Weakness
1. Old fashioned policies and values
2. No formal mission statement
3. Censored products
4. Low marketing efforts
5. Low profit margin in e-tailing
6. dominance of top management
7. Undifferentiated products

 Opportunities
1. Increasing online retailing
2. Increase international presence
3. Economies of scale
4. Acquisitions
5. Quality improvement

 Threats
1. Competition
2. Threats of new entrants
3. Legal issues eg. Philanthropy
4. Increase in customer bargaining power
5. Harsh economic conditions

TOWS
SO
ST
S1+S3 +S10+O1 the online presence S4,S14+T1 through low cost
of the company can be increased by
leadership and supply chain
the use brand name wide variety
efficiency the threat of competition
and existingonline network
can be reduced
S8, S13+O2 the international
S15+T2 Due to economic recession
presence of the company can be
now major chunk of population will
increased with the help of efficient
move towards buying less expensive
supply chain network and
goods
distribution centers and moreover
by involving the community
S4,S14+O4 with the help of low cost
leadership and strong financial
position the company can do
acquisitions
WO
W7+O5the products that it sells are
undifferentiated by improving the quality

WT

POTERS
Threats of new entrants

Discount retail shops are highly competitive.

Pricing factor plays key role
Walmart has strong supplier connections
Supply chain and superior distribution channel make it
impossible to impose any threat to wall mart
Wall mart has cost advantage our its compitator

 Threat of substitute
There is no such direct threat of substitute
Consumers can buy from small shops but they dont offer
competitive price as walmart
Local shops dont offer wide range of product
Somewhat online shopping can affect but its not suitable for
daily usage goods

 Threat of competition
Industry is mature
Few competitors dominate this industry
Firms compete on cost

 Buyers bargaining power

Switching cost is low
Price sensitive buyers as low cost and value for money mindset
Buyers have low bargain power in sense as Walmart offers
lowest price among competitors

 Bargaining power of supplier

Walmart has strong bargaining power with their suppliers due
to thousand number of stores
Walmart has its own supply chain so they dont much depend
on their suppliers supply chain to get their products deliver
Walmart also have its own product altered for local customers

IFE

Strengths

weight

rating

Weighted score

Wide variety

0.1

0.4

Brand name

0.05

0.2

Low cost leadership

0.12

0.36

Catering to different markets

0.08

0.24

Supply chain efficiency

0.08

0.24

Strong financial position

0.05

0.2

Online presence

0.09

0.18

Employee trainings
weakness

0.06

0.18

values and policies

0.05

0.1

No formal mission statement

0.05

0.1

Undifferentiated products

0.1

0.3

Dominance of top
management

0.1

0.3

Low profit margins in etailing

0.08

0.16

EFE
Opportunities

weight

score

Weighted score

Increase in online
retailing

0.1

0.2

Increase presence
internationally

0.2

0.6

acquisitions

0.1

0.1

Quality improvement

0.05

0.1

Market penetration

0.05

0.15

Cost
competition
threats

0.1

0.3

competition

0.15

0.45

New entrants

0.05

0.15

Legal issues

0.05

0.05

Harsh economic
conditions

0.05

0.05

Increase in customer
bargaining power

0.05

0.1

Political issues

0.05

0.05

CPM
Walmart

Target

K-Mart

Critical Success
Factors

weight

score

Weighted
score

score

Weighted
score

score

Weighted
score

Brand name

0.05

0.2

0.2

0.15

variety

0.12

0.24

0.36

0.36

Supply chain
efficiency

0.2

0.6

0.4

0.4

Management

0.07

0.21

0.14

0.14

advertisement

0.08

0.16

0.24

0.24

Financial position

0.08

0.32

0.24

0.16

Global position

0.12

0.48

0.24

0.12

Number of stores

0.1

0.4

0.3

0.2

Product Quality

0.08

0.16

0.24

0.16

Price
Competitiveness

0.1

0.4

0.3

0.3

IE matrix
Strong
3-4
1

Average
2-2.99
2

Weak
1-1.99
3

Strong
3-4
4
Average
2-2.99
Weak
1-1.99

BCG matrix
Walmart
international
Questio
n Markt

star
Sams club
Walmart US

cashcow

dog

Grand Strategy Matrix

High Market Growth
Walmart
Kmar
t
Weak
competitive
position

Targ
et
Strong
competiti
ve
position

Low Market
Growth

 It has a high growth potential in spite of the economic recession. (DOWs top
performer)
Highly competitive retail market
Can adopt the following strategies:
1. Market development: Walmart has always adopted a growth and
expansion strategy it can further venture in to untapped international
courtiers like (India, France, Germany etc. ) as well as locally where there is
currently limited representation (Alaska, Hawaii, Vermont, Wyoming etc.).
2. Backward Integration: Since Walmart follows a low cost leadership
strategy in order to further reduce costs and avoid predatory pricing it can
use a backward integration strategy. E.g Since perishables like food is
included in multiple SBUs it can start self producing.

Space Matrix
Stability
position

Rating

Financial
Position

Rating
4

growth

-2

Dividends
declared

Technological
changes

-4

Debt ratio

goodwill

profitability

-2

Stable earnings

demand

-3

risk

-3

Current ratio

Average

-2.8

Average

4.4

Industry
Position

Rating

Competitive
Position

Rating

Barriers to
entry

Market share

-2

substitutes

recognition

-1

Business cycle

quality

-4

regulations

loyalty

-4

Marketing
efforts

pricing

-2

Average

4.2

Average

-2.6

FP
Aggressive
1.6
CP

1.
6

SP

IP

Walmart can adopt the following aggressive Strategies:

Market penetration: Walmart can choose to increase its market share especially
for its Sams club as Costco currently has the upper hand. It can achieve this by
increased advertising efforts or by providing more enhancing services.
Market development: It can venture in to untapped international courtiers like
(India, France, Germany etc. ) as well as locally where there is currently limited
representation (Alaska, Hawaii, Vermont, Wyoming etc.)
Backward Integration: Since Walmart follows a low cost leadership strategy in
order to further reduce costs and avoid predatory pricing it can use a backward
integration strategy. E.g Since perishables like food is included in multiple SBUs it
can start self producing.

QSPM

Key Factors

Weight Market
development:
international
and locally
untapped
markets

Backward
Integration:
Hold over
suppliers
especially food
supplies

Market
penetration:
Particularly for
sams club via
marketing

Wide variety

0.1

Low cost

.3

.05

Strong financial position

.1

competition

.15

acquisitions

.025

Increase in online retailing .020

Increase presence
internationally

.055

Supply chain efficiency

.2

2.805

2.38

2.595

marketing efforts