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Wall Mart- MIS Report

Wall Mart- MIS Report

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Published by vikrambhati
This report is prepared for the benefits of the graduate students of Marketing field or Management courses.
This report is prepared for the benefits of the graduate students of Marketing field or Management courses.

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Published by: vikrambhati on Jul 31, 2009
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05/13/2013

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Analysis of the Industry’s environment :
Wal-Mart Stores, Inc.
is anAmerican public corporationthat runs a chain of large, discount department stores. It is the world's largest publiccorporation by revenue, according to the 2008Fortune Global 500. FoundedbySam Waltonin 1962, it wasincorporatedonOctober 31,1969, and listed on theNew York Stock Exchangein 1972. It is the largest private employerin the world and the fourth largest utility or commercial employer, trailingthe BritishNational Health Service, and theIndian Railways. Wal-Mart is the largestgrocery retailerin theUnited States, with an estimated 20% of the retail grocery and consumables business, as well as the largest toy seller inthe U.S. It also owns and operates the North American company,Sam's Club.As Wal-Mart grew rapidly into the world's largest corporation, many criticsworried about the effect of its stores on local communities, particularlysmall towns with many "mom and pop" stores. There have been severalstudies on the economic impact of Wal-Mart on small towns and localbusinesses, jobs, and taxpayers. In one, Kenneth Stone, a Professor of Economics atIowa State University, found that some small towns can losealmost half of their retail trade within ten years of a Wal-Mart storeopening. However, in another study, he compared the changes to whatsmall town shops had faced in the past — including the development of therailroads, the advent of the Sears Roebuck catalog, as well as the arrival of shopping malls — and concluded that shop owners who adapt to changes inthe retail market can thrive after Wal-Mart arrives. A later study incollaboration withMississippi State Universityshowed that there are "bothpositive and negative impacts on existing stores in the area where the newsupercenter locates .Wal-Mart Stores Division U.S. is Wal-Mart's largestbusiness subsidiary, accounting for 67.2% of net sales for financial year2006. It consists of three retail formats that have become commonplace inthe United States:Discount Stores,Supercenters, andNeighborhood  Markets. The retail department stores sell a variety of mostly non-groceryproducts, though emphasis has now shifted towards supercenters, whichinclude more grocery items. This division also includes Wal-Mart'sonline retailer,
walmart.com
.In North America, Wal-Mart's primary competitionincludesdepartment storeslikeKmart, Target,ShopKo,Meijer, and
 
Canada'sZellers,Winners, andGiant Tiger. Competitors of Wal-Mart's Sam's Club division areCostco, and the smallerBJ's Wholesale Clubchain operating mainly in the eastern US. Wal-Mart's move into thegrocerybusiness in thelate 1990s also set it against majorsupermarketchains in both the UnitedStates and Canada. Several smaller retailers, primarilydollar stores, suchasFamily DollarandDollar General, have been able to find a small niche market and compete successfully against Wal-Mart for home consumersales. In 2004, Wal-Mart responded by testing its own dollar store concept, asubsection of some stores called "Pennies-n-Cents.Wal-Mart also had to face fierce competition in some foreign markets. Forexample, in Germany it had captured just 2% of German food marketfollowing its entry into the market in 1997 and remained "a secondaryplayer" behindAldiwith a 19% share. In July 2006, Wal-Mart announced itswithdrawal from Germany. Its stores were sold to German companyMetro.Wal-Mart continues to do well in the UK, and itsASDAsubsidiary is thesecond largest chain after Tesco.In May 2006, after entering the South Korean market in 1998, Wal-Martwithdrew and sold all 16 of its South Korean outlets toShinsegae, a localretailer, for $882 million. Shinsegae re-branded the Wal-Marts asE-martstores.Wal-Mart struggled to export its brand elsewhere as it rigidly tried toreproduce its model overseas. In China, Wal-Mart hopes to succeed byadapting and doing things preferable to Chinese citizens. For example, itfound that Chinese consumers preferred to select their own live fish andseafood; stores began displaying the meat uncovered and installed fishtanks, leading to higher sales.In addition, under heavy pressure from the Chinese government, Wal-Martaccepted a form of organized labor in China. Chinese labor unions do notnegotiate contracts but simply pay dues to the government, "to secure thesocial order." However, Chinese consumers may be more opentoAmericanathan shoppers in Europe.
 
Kinds of strategic moves that industry members are likely to employ:
Design and open a new store prototype within four years that improves energy efficiencyand reduces greenhouse gas emissions by up to 30 percent in these stores.
Reduce greenhouse gas emissions from existing stores, clubs and distribution centers by 20
 percent within seven years.
Establish a US program within 18 months that gives preference to suppliers whoaggressively reduce emissions.
Implement a China program that gives preference to environmentally-responsible suppliers.
Aggressively pursue regulatory and policy changes that promote energy efficiency andrenewable energy.
Reduce solid waste from US stores and clubs by 25 percent within three years.
Work with suppliers to reduce packaging, increase recycled content, and expand recycling of 
Packaging.
Eliminate PVC packaging from private label brands within two years.
Sourcing: establish independent monitoring of Wal-Mart’s factory certification program;separate the factory certification and buying functions; cease doing business with supplier factories that fail to meet Wal-Mart’s ethical standards; collaborate with industry, governmentand NGOs to improve sourcing in developing countries.
Healthcare: make healthcare insurance available to all employees for $23 per month or lessand their children for $15 per month; put healthcare clinics in stores for employees andcustomers; provide volume discounts on healthcare insurance to small businesses; collaboratewith business, government and others on US healthcare reform with the goal of loweringcosts by as much as 25 percent.

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