2-3 page executive summary

Running Head: WAL-MART STORES, INC. STRATEGY ANALYSIS 0

Wal-Mart Stores, Inc. Strategy Analysis

Introduction

Walmart was founded by two brothers Sam Walton and Bud between the year 1945 and 1961 as a chain of 15 franchised stores in the rural Arkansas, Sam Walton was interested in providing stores with low prices in order to avoid having discount stores (Anonymous 2012). Walmart was opened in medium and small towns such as Oklahoma, Arkansas and Missouri though at the time distribution was not easy for them. In 1970 Walmart managed to open its first distribution center and during this year it also took its company public to finance its heavy investment that it had incurred.

Definition of Strategy Fits on Wal-Mart and Its Situation

A strategy can be defined as a plan or a method that a company or an individual chooses in order to achieve a goal or get a solution to a problem. For Walmart to become successful and manage to develop over the years the management had to come up with strategies that enabled it to become the company it is today. Walmart began as a small store and at that time it had distribution challenges and the management came up with a plan or a method in which would help solve this challenge and by 1970 they had come up with a distribution center that is a good example of a good strategy they managed. For Walmart to extend its market share it had to come up with strategies and one of the strategies was by forming joint ventures with international stores such as Cifra SA this enabled it to venture into the international market in places such as South America, Asia and Europe. Walmart had to be careful in coming up with strategies to ensure that they were successful in their operations and has made it the greatest retail company in the world.

Main Strategies That Leading Up To Wal-Mart Recent Development

The greatest and the main strategy that has led to the development of Walmart is their aggressive pricing or cost leadership strategy over the years from the time it was opened all Sam Walton desired was to sell their products as a low affordable price as their main committed was to ensure that people saved a lot of money. Walmart’s pricing philosophy the EDLP that is everyday low prices has been very helpful and this has brought success to the company. As a result of low prices Walmart manages to sell large volumes of products thus increasing their profit margins (Ferguson 2017). Walmart’s marketing strategy has contributed to its development as well, Sam valued his customers and he believed that customers contribute largely to the success of his company thus their strategies had to be customer-oriented. The company’s pricing philosophy became a basis of their marketing strategy as the low price itself spread out and marketed the company. The company was also had environmental and social responsibility and this appealed many customers and this helped cut their marketing cost.

Main Competitors of Wal-Mart and Their Strategies Analysis

Amazon is among the leading Walmart competitors it has become successful through strategies, the main has been the generic corporate strategy this has been the use of technology expertise to create value for their customers. The other strategy is its intensive growth strategies that include market penetration, Amazon’s generic strategy has led to competitive advantage that enhances market penetration (Shaughnessy 2012). The other strategy is market development, this strategy is used in order to enter and grow new markets this has enabled it to grow and develop.

Industry Analysis for the CEO of Wal-Mart and Company’s Current Standing

The industry has high rivalry this is due to high growth rate of competitors, high diverse competitors and high storage costs. There is high buyer power in the industry due to product differentiation and availability of substitutes, Walmart’s CEO thus should consider this analysis in his strategic management. Walmart has gained a high number of loyalty customers over the years and this has enabled it to remain a leading retailer.

Performance Goals for the Wal-Mart

Performance management is a procedure that must be sporadically modified to perceive ranges for upgrade, and perceive whether every one of the associations segments attempting to accomplish the fancied objectives or they require some change to encourage them to fuse all the required components, from wanting to usage. Encourage, it is likewise basic to recognize that the performance management advances effectiveness inside the association, which is an approach to add to success of the business (Lotich, 2016).

The three Walmart performance goals will include;

1. The increase in the use of technological expertise this will enable it to reach more customers and improve their company’s operations.

2. The other goal will be to encourage innovation in the company this will enable the company to acquire new ideas and skills to improve their performance and strategies.

3. The third performance goal will be to improve its community relations this will assist the company to avoid conflicts with the community as well as with the legal system.

References

Anonymous. (2012). Wal-mart stores Inc., Case 6.

Ferguson, E. (2017). Walmart’s Vision, Mission, Generic & Intensive Strategies. Panmore Institute. Retrieved from http://panmore.com/walmart-vision-mission-statement-intensive-generic-strategies

Lotich, P. (2016). Example Business Goals and Objectives. Retrieved from http://thethrivingsmallbusiness.com/examples-of-business-goals/

Shaughnessy, H. (2012). Why Amazon Succeeds. Forbes. Retrieved from http://www.forbes.com/sites/haydnshaughnessy/2012/04/29/why-amazon-succeeds/#350b525ca6c4