WAL-MART STORES INC.

CASE ANALYSIS

Team: Gyan Niwas

Workforce Culture • Customer-oriented mindset of workforce  Loyal customers Benefits  Mindset of continuously improving customer experience Trade-off  Requires strong higher management involvement 1|Page . Low prices. “sundown rule”) result in superior customer Satisfaction experience.Infosys Ingenious Case Analysis: Wal-Mart Stores Inc. Benefits  Higher customer satisfaction  Allows for volume-based strategy Trade-off  Requires heavy investment in supply chain & IT Supplier Relationship • Integrated supplier partnerships. advanced data management and extremely motivated Customer employees (“10 feet rule”. Wal-Mart’s Strategy • • Essentially low-cost. high volume strategy Aims at customer satisfaction through low prices and good customer service. A one-stop solution by offering a wide range of products Competitive Advantage Advanced Distribution Capabilities • Including cross-docking • Wal-Mart’s own distribution centres • “Inside-out” location strategy  Economies of scale favour volume-based strategy Benefits  Cost savings from lower inventory levels  Needs heavy investment Trade-off  Requires sophisticated IT EDLP (Everyday Low Pricing)  Lower costs because of lesser advertising. Lower operating expenses than the industry average through superior Low cost distribution capability High Volume Volume-based growth through increased market share. who are considered as stakeholders  Lowered distribution cost due to improved supply chain Benefits  Preferential treatment by suppliers Trade-off  Access to supplier sales & inventory data Advanced Customer Buying Pattern analysis • Collection & usage of customer purchase behaviour  More accurate forecasting of demand Benefits  Lower costs through reduced inventory  Useful data for suppliers Trade-off  High cost involved.

future key growth driver  Retailer’s revenues annual growth Stagnant US  US .30% vis-a-vis competitor’s margins of 30% Company facing stiff competition on warehousing front  Inventory turnover figures of 11. quality focussed . Image makeover challenge with increasing pressure of unionization Activism from environmentalists.15%  Significant scope for expansion for the retailer  Huge pool of value conscious customers Emerging  Proven business model Markets  Overall strategy for Wal-Mart makes sense in other countries too  For the most part.service oriented and have more diversified product range. Wal-Mart’s competitive advantages can be transferred abroad 2|Page . Preserves Wal-Mart’s cost structure • Increased focus on international growth .06% Company does not have a consistent strategic approach to different international markets resulting into uneven profitability across geographies.Infosys Ingenious Core Business issues • • • • • • • Expansion into multiple segments has forced it to compete on broader front with competitors  Competitor are more stylish. anti-globalization activists. women and children rights advocates Recommendations for future growth • Improve store productivity by remodelling discount stores into supercentres  Higher revenue per store and higher operating profit/sq ft reported by supercentres • New smaller formats in urban markets Current  Space constraints Limitations  Busy schedules limit many customers from driving to a supercentre  Occupy less space  Cost less Retailer’s  Run more efficiently small stores Positive Effect: Profitable format economics. Challenge for company's Arkansas driven management style and culture as it has transformed into global MNC. Facing heat on discount retailing front  Gross profit margins down to 24.1% growth  International .5% taking a beating from nearest rival's 12.

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